Energy giants spent $1bn on climate lobbying

Energy giants spent $1bn on climate lobbying

Polluters, as all those big energy producers (Big Oils, OPEC members and non members alike) are labelled, appeared to be ‘undermining’ UN climate Paris agreement. In effect, Oil, Gas and Coal world giants are exploiting a lack of conflict-of-interest protection at UN climate talks to push for continued fossil fuel use despite its contribution to catastrophic climate change through expensive lobbying campaigns because as it happens these oil, gas and coal giants could stand to waste trillions in a moderate world climate change. Patrick Galey elaborates on Phys.org.

Energy giants spent $1bn on climate lobbying, PR since Paris: watchdog

By Patrick Galey
The five biggest publicly listed oil and gas majors made profits of $55 billion in 2018
The five biggest publicly listed oil and gas majors made profits of $55 billion in 2018

The five largest publicly listed oil and gas majors have spent $1 billion since the 2015 Paris climate deal on public relations or lobbying that is “overwhelmingly in conflict” with the landmark accord’s goals, a watchdog said Friday.

Despite outwardly committing to support the Paris agreement and its aim to limit global temperature rises, ExxonMobil, Shell, Chevron, BP and Total spend a total of $200 million a year on efforts “to operate and expand fossil fuel operations,” according to InfluenceMap, a pro-transparency monitor.

Two of the companies—Shell and Chevron—said they rejected the watchdog’s findings.

“The fossil fuel sector has ramped up a quite strategic programme of influencing the climate agenda,” InfluenceMap Executive Director Dylan Tanner told AFP.

“It’s a continuum of activity from their lobby trade groups attacking the details of regulations, controlling them all the way up, to controlling the way the media thinks about the oil majors and climate.”

The report comes as oil and gas giants are under increasing pressure from shareholders to come clean over how greener lawmaking will impact their business models.

As planet-warming greenhouse gas emissions hit their highest levels in human history in 2018, the five companies wracked up total profits of $55 billion.

At the same time, the International Panel on Climate Change—composed of the world’s leading climate scientists—issued a call for a radical drawdown in fossil fuel use in order to hit the 1.5C (2.7 Fahrenheit) cap laid out in the Paris accord.

InfluenceMap looked at accounts, lobbying registers and communications releases since 2015, and alleged a large gap between the climate commitments companies make and the action they take.

It said all five engaged in lobbying and “narrative capture” through direct contact with lawmakers and officials, spending millions on climate branding, and by employing trade associations to represent the sector’s interests in policy discussions.

“The research reveals a trend of carefully devised campaigns of positive messaging combined with negative policy lobbying on climate change,” it said.

It added that of the more than $110 billion the five had earmarked for capital investment in 2019, just $3.6bn was given over to low-carbon schemes.

Oil companies and climate change
Forecast combined capital spending in 2019 by the major oil companies – BP, Total, Shell, Chervron, ExxonMobil – on oil and gas and low carbon projects and spending on lobbying and branding.

The report came one day after the European Parliament was urged to strip ExxonMobil lobbyists of their access, after the US giant failed to attend a hearing where expert witnesses said the oil giant has knowingly misled the public over climate change.

“How can we accept that companies spending hundreds of millions on lobbying against the EU’s goal of reaching the Paris agreement are still granted privileged access to decision makers?” said Pascoe Sabido, Corporate Europe Observatory’s climate policy researcher, who was not involved in the InfluenceMap report.

The report said Exxon alone spent $56 million a year on “climate branding” and $41 million annually on lobbying efforts.

In 2017 the company’s shareholders voted to push it to disclose what tougher emissions policies in the wake of Paris would mean for its portfolio.

US donations

With the exception of France’s Total, each oil major had largely focused climate lobbying expenditure in the US, the report said.

Chevron alone has spent more than $28 million in US political donations since 1990, according to the report.

AFP contacted all five oil and gas companies mentioned in the report for comment.

“We disagree with the assertion that Chevron has engaged in ‘climate-related branding and lobbying’ that is ‘overwhelmingly in conflict’ with the Paris Agreement,” said a Chevron spokesman.

“We are taking action to address potential climate change risks to our business and investing in technology and low carbon business opportunities that could reduce greenhouse gas emissions.”

A spokeswoman for Shell—which the report said spends $49 million annually on climate lobbying—said it “firmly rejected” the findings.

“We are very clear about our support for the Paris Agreement, and the steps that we are taking to help meet society’s needs for more and cleaner energy,” they told AFP.

BP, ExxonMobil and Total did not provide comment to AFP.

Explore further: Money talks when trying to influence climate change legislation

Read more at: https://phys.org/news/2019-03-energy-giants-spent-1bn-climate.html#jCp

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Fossil-fuel Executives are Mass Murderers

Fossil-fuel Executives are Mass Murderers

It isn’t hyperbole to say that fossil-fuel executives are mass murderers. We should put them on trial for crimes against humanity.

It’s Time to Try Fossil-Fuel Executives for Crimes Against Humanity

By Kate Aronoff


Then–US secretary of State Rex Tillerson, the former head of ExxonMobil, looks on during a Senate Foreign Relations Committee hearing on October 30, 2017 in Washington DC. Drew Angerer / Getty

The fossil-fuel industry is lawyering up.

To date, nine cities have sued the fossil industry for climate damages. California fisherman are going after oil companies for their role in warming the Pacific Ocean, a process that soaks the Dungeness crabs they harvest with a dangerous neurotoxin. Former acting New York state attorney general Barbara Underwood has opened an investigation into whether ExxonMobil has misled its shareholders about the risks it faces from climate change, a push current Attorney General Leticia James has said she is eager to keep up. Massachusetts attorney general Maura Healey opened an earlier investigation into whether Exxon defrauded the public by spreading disinformation about climate change, which various courts — including the Supreme Court — have refused to block despite the company’s pleas. And in Juliana vs. U.S., young people have filed suit against the government for violating their constitutional rights by pursuing policies that intensify global warming, hitting the dense ties between Big Oil and the state.

These are welcome attempts to hold the industry responsible for its role in warming our earth. It’s time, however, to take this series of legal proceedings to the next level: we should try fossil-fuel executives for crimes against humanity.

Guilty Beyond a Reasonable Doubt

Just one hundred fossil fuel producers — including privately held and state-owned companies — have been responsible for 71 percent of the greenhouse gas emissions released since 1988, emissions that have already killed at least tens of thousands of people through climate-fueled disasters worldwide.

Green New Deal advocates have been right to focus on the myriad ways that decarbonization can improve the lives of working-class Americans. But an important complement to that is holding those most responsible for the crisis fully accountable. It’s the right thing to do, and it makes clear to fossil-fuel executives that they could face consequences beyond vanishing profits.

More immediately, a push to try fossil-fuel executives for crimes against humanity could channel some much-needed populist rage at the climate’s 1 percent, and render them persona non grata in respectable society — let alone Congress or the UN, where they today enjoy broad access. Making people like Exxon CEO Darren Woods or Shell CEO Ben van Beurden well known and widely reviled would put names and faces to a problem too often discussed in the abstract. The climate fight has clear villains. It’s long past time to name and shame them.

Left unchecked, the death toll of climate change could easily creep up into the hundreds of millions, according to the Intergovernmental Panel on Climate Change (IPCC), in turn unleashing chaos and suffering that’s simply impossible to project. An independent report commissioned by twenty governments in 2012 found that climate impacts are already causing an estimated four hundred thousand deaths per year.

Counting a wider range of casualties attributed to burning fossil fuels — air pollution, indoor smoke, occupational hazards, and skin cancer — that figure jumps to nearly 5 million a year. By 2030, annual climate and carbon-related deaths are expected to reach nearly 6 million. That’s the rough equivalent of one Holocaust every year, which in just a few short years could surpass the total number of people killed in World War II. All caused by the fossil-fuel industry.

Knowing full well the deadly consequences of continued drilling, the individuals at the helm of fossil-fuel companies each day choose to seek out new reserves to burn as quickly as possible to keep their shareholders happy. They use every possible tool — and they have many — to sabotage regulatory action.

That we need to instead strip fossil fuels from the global economy isn’t up for debate. Without the increasingly distant-seeming deployment of speculative, so-called negative emissions technologies, coal usage will have to decline by 97 percent, oil by 87 percent, and gas by 74 percent by 2050 for us to have a halfway decent shot at keeping warming below 1.5 degrees celsius. That’s what it will take to avert pervasive, catastrophic climate impacts that will destabilize the very foundations of society. (Keeping warming to a more dangerous 2.0 degrees celsius will require decarbonization that’s almost as abrupt.)

recent report by Oil Change International detailing the climate costs of continued drilling lays the problem out in simple terms: either we embark on a managed decline of the fossil-fuel industry, or we face economic and ecological ruin. Simply put, the business model of the fossil-fuel industry is incompatible with the continued existence of anything we might recognize as human civilization.

Barring a major course correction, that business model — and more specifically, the executives who have designed and executed it — will be responsible for untold suffering within many of our lifetimes, with the youngest and poorest among us bearing a disproportionate burden, along with people of color and residents of the Global South.

As recent research and reporting have documented, some of the world’s biggest polluters have known for decades about the deadly threat of global warming and the role their products play in fueling it. Some companies began research into climate change as early as the 1950s. These days, none can claim not to know the mortal danger posed by their ongoing extraction.

Literally a Crime Against Humanity

Technically speaking, what fossil-fuel companies do isn’t genocide. Low-lying islands and communities around the world are and will continue to be the worst hit by climate impacts.

Still, the case against the fossil-fuel industry is not that their executives are targeting specific “national, ethnical, racial, or religious” groups for annihilation, per the Rome Statute, which enumerates the various types of human rights abuses that can be heard before the International Criminal Court. Rather, the fossil industry’s behavior constitutes a Crime Against Humanity in the classical sense: “a widespread or systematic attack directed against any civilian population, with knowledge of the attack,” including murder and extermination. Unlike genocide, the UN clarifies, in the case of crimes against humanity,

it is not necessary to prove that there is an overall specific intent. It suffices for there to be a simple intent to commit any of the acts listed…The perpetrator must also act with knowledge of the attack against the civilian population and that his/her action is part of that attack.

Fossil-fuel executives may not have intended to destroy the world as we know it. And climate change may not look like the kinds of attacks we’re used to. But they’ve known what their industry is doing to the planet for a long time, and the effects are likely to be still more brutal if the causes are allowed to continue.

Read more in the original document.

Taking bold climate action now, could help

Taking bold climate action now, could help

The United Nation in its December 5, 2018 blog recommends :

Taking bold climate action now, could help save a million lives and a lot of money by the middle of the century, said the World Health Organization (WHO) on Wednesday, launching a special report as part of the ongoing COP24 climate conference in Katowice, Poland.

As the world is coming together to define ways to move forward on climate action and the realization of the objectives defined in the 2015 Paris Agreement, WHO stressed that it’s not just the planet that would benefit –  an estimated one million lives could be saved through reductions in air pollution alone.

“The Paris Agreement is potentially the strongest health agreement of this century,” said Dr. Tedros Adhanom Ghebreyesus, Director-General of WHO. “The evidence is clear that climate change is already having a serious impact on human lives and health. It threatens the basic elements we all need for good health – clean air, safe drinking water, nutritious food supply and safe shelter – and will undermine decades of progress in global health.”

The report also shows that the economic benefits of improved health would be twice as high as the economic cost of mitigating global warming, and fighting air pollution. The return on investment is even higher in countries key to tackling global emissions, such as China and India. (see below the W H O’ s article with my own bolds)

Health benefits far outweigh the costs of meeting climate change goals

5 December 2018, News Release, Katowice, Poland

Meeting the goals of the Paris Agreement could save about a million lives a year worldwide by 2050 through reductions in air pollution alone. The latest estimates from leading experts also indicate that the value of health gains from climate action would be approximately double the cost of mitigation policies at global level, and the benefit-to-cost ratio is even higher in countries such as China and India.

A WHO report launched today at the United Nations Climate Change Conference (COP24) in Katowice, Poland highlights why health considerations are critical to the advancement of climate action and outlines key recommendations for policy makers.

Exposure to air pollution causes 7 million deaths worldwide every year and costs an estimated US$ 5.11 trillion in welfare losses globally. In the 15 countries that emit the most greenhouse gas emissions, the health impacts of air pollution are estimated to cost more than 4% of their GDP. Actions to meet the Paris goals would cost around 1% of global GDP.

Air pollution is a major environmental risk to health. Infographics from WHO website.

“The Paris Agreement is potentially the strongest health agreement of this century,” said Dr Tedros Adhanom Ghebreyesus, Director-General of WHO. “The evidence is clear that climate change is already having a serious impact on human lives and health. It threatens the basic elements we all need for good health – clean air, safe drinking water, nutritious food supply and safe shelter – and will undermine decades of progress in global health. We can’t afford to delay action any further.”

The same human activities that are destabilizing the Earth’s climate also contribute directly to poor health. The main driver of climate change is fossil fuel combustion which is also a major contributor to air pollution.

“The true cost of climate change is felt in our hospitals and in our lungs. The health burden of polluting energy sources is now so high, that moving to cleaner and more sustainable choices for energy supply, transport and food systems effectively pays for itself,” says Dr Maria Neira, WHO Director of Public Health, Environmental and Social Determinants of Health. “When health is taken into account, climate change mitigation is an opportunity, not a cost.”

Switching to low-carbon energy sources will not only improve air quality but provide additional opportunities for immediate health benefits. For example, introducing active transport options such as cycling will help increase physical activity that can help prevent diseases like diabetes, cancer and heart disease.

WHO’s COP-24 Special Report: health and climate change provides recommendations for governments on how to maximize the health benefits of tackling climate change and avoid the worst health impacts of this global challenge.

It describes how countries around the world are now taking action to protect lives from the impacts of climate change – but that the scale of support remains woefully inadequate, particularly for the small island developing states, and least developed countries. Only approximately 0.5% of multilateral climate funds dispersed for climate change adaptation have been allocated to health projects.

Pacific Island countries contribute 0.03% of greenhouse gas emissions, but they are among the most profoundly affected by its impacts. For the Pacific Island countries, urgent action to address climate change — including the outcome of COP24 this week — is crucial to the health of their people and their very existence.

“We now have a clear understanding of what needs to be done to protect health from climate change – from more resilient and sustainable healthcare facilities, to improved warning systems for extreme weather and infectious disease outbreaks. But the lack of investment is leaving the most vulnerable behind,” said Dr Joy St John, Assistant Director-General for Climate and Other Determinants of Health.

The report calls for countries to account for health in all cost-benefit analyses of climate change mitigation. It also recommends that countries use fiscal incentives such as carbon pricing and energy subsidies to incentivize sectors to reduce their emissions of greenhouse gases and air pollutants. It further encourages Parties to the United Nations Framework Convention on Climate Change (UNFCCC) to remove existing barriers to supporting climate-resilient health systems.

WHO is working with countries to:

  • ·         Assess the health gains that would result from the implementation of the existing Nationally Determined Contributions to the Paris Agreement, and the potential for larger gains from the more ambitious action required to meet the goals of limiting global warming to 2oC or 1.5oC.
  • ·         Ensure climate-resilient health systems, especially in the most vulnerable countries such as small island developing states (SIDS); and to promote climate change mitigation actions that maximize immediate and long-term health benefits, under a special initiative on climate change and health in SIDS, launched in partnership with the UNFCCC Secretariat and the Fijian Presidency of COP-23 and operationalized by the Pacific Islands Action Plan on Climate Change and Health.
  • ·         Track national progress in protecting health from climate change and gaining the health co-benefits of climate change mitigation measures, through the WHO/UNFCCC Climate and Health country profiles, currently covering 45 countries, with 90 due for completion by the end of 2019.
The latest IEA World Energy Outlook

The latest IEA World Energy Outlook

All International Energy Agency (IEA) scenarios show renewables growth won’t deliver a climate cure.

None of the scenarios in the latest IEA World Energy Outlook show renewables growing fast enough to meet global climate goals is elaborated on by Jason Deign on November 13, 2018.

Gloomy Prospects in IEA’s Latest World Energy Outlook

 

Under current policies, said the IEA this week, the world would see increasing strains on almost all aspects of energy security and “a major additional rise” in energy-related carbon emissions.

And under a new policies scenario, incorporating measures and targets already announced by governments worldwide, global energy demand would still grow by more than a quarter through 2040, leading to increased demand for oil.

Even under a sustainable development scenario, aimed at achieving the energy goals of the United Nations Sustainable Development agenda and the long-term objectives of the Paris Agreement, renewables growth falls short of delivering a climate change cure. 

Instead, said the IEA, society would also need to rely on energy efficiency and largely untested technologies such as renewable hydrogen synthesis and carbon capture, utilization and storage, as well as write off current investments in new coal plants.

“Most emissions linked to energy infrastructure are already essentially locked in,” the IEA explained in a press release. “In particular, coal-fired power plants, which account for one third of energy-related CO2 emissions today, represent more than a third of cumulative locked-in emissions to 2040.” 

The situation is particularly grave in Asia, where coal plants have an average age of 11 years old and are supposed to carry on running for decades, compared to the 40-year average age of coal-fired generation assets in the U.S. and Europe, said the IEA.

In press materials, the IEA’s executive director Dr. Fatih Birol said the agency had reviewed all current and under-construction energy infrastructure around the world and found it would account for around 95 percent of all emissions permitted under international climate targets.

“This means that if the world is serious about meeting its climate targets, then, as of today, there needs to be a systematic preference for investment in sustainable energy technologies,” Birol said. 

“But we also need to be much smarter about the way that we use our existing energy system,” he said. “To be successful, this will need an unprecedented global political and economic effort.”

In the IEA’s sustainable development scenario, electrification grows strongly, but so too does the direct use of renewables such as bioenergy, solar and geothermal to provide heat and mobility.

The share of renewables in the power mix would need to rise from a quarter today to two-thirds in 2040. For heating it would need to go up from 10 percent today to 25 percent in 2040, and in transport it would need to rise from 3.5 percent to 19 percent.

The scenario foresees vast increases in wind and solar PV generation, up from 1.5 petawatt-hours a year in 2017 to 14.1 petawatt-hours in 2040. Electric vehicle adoption would also have to soar, from 9.2 million cars in 2017 to more than 933 million in 2040. 

Wind, solar and electric vehicles are all commercially viable industries, though. 

What is perhaps more worrying about the IEA’s sustainable development scenario is that it relies heavily on carbon capture, utilization and storage (CCUS), a technology which has yet to reach commercial scale and which Wood Mackenzie believes will have a “limited impact on achieving future targets.”

Under the sustainable development scenario, CCUS would have to go from capturing 22.7 gigatons of carbon dioxide in 2017 to more than 2,364 gigatons in 2040, or more than a hundredfold increase in 23 years. 

Even organizations that stood to gain under the IEA scenarios offered guarded responses to the latest World Energy Outlook.

Noting that the IEA has shortened the length of time in its forecast at which wind would become the largest grid power source in Europe, Giles Dickson, CEO at the industry body WindEurope, said, “While it’ll be good to be No. 1 in electricity, electricity is only 24 percent of Europe’s energy.”

“To decarbonize the whole energy system, we’re going have to start getting large amounts of wind and other renewables into heating, transport and industrial processes,” he added. 

On the plus side, though, the IEA’s annual World Energy Outlook scenarios have historically been criticized for underestimating renewables growth.

The Eindhoven University of Technology researcher Auke Hoekstra, for example, has shown that World Energy Outlook reference and new policy scenarios for solar energy capacity additions have been massively beneath what has happened in real life.

Policymakers may be hoping the same is true this year. But it might be necessary not to wait too long to find out.

 

Lessons from Recent History of Technology Introductions

Lessons from Recent History of Technology Introductions

Science and Society published an article posted 1 Day Ago by Ron Clutz on all facets of energy transitions throughout modern history. The lessons from recent history of technology introductions should not per Cambridge Professor Michael J. Kelly, be forgotten when considering alternative energy technologies for any carbon dioxide emission reductions.


On Energy Transitions


These days the media are full of stories about people setting targets to “decarbonize” the energy sources fueling their societies. Some are claiming (and some have failed notoriously) to achieve zero carbon electrification. We should take a deep breath, step back and rationally consider what is being discussed and proposed.

The History of Energy Transitions

Thanks to Bill Gates we have this helpful graph showing the progress of human civilization resulting from shifts in the mix of energy sources.

https://cdn.theatlantic.com/assets/media/img/posts/2015/10/WEL_Bennet_Gates_chart/417fd6923.jpg

Before the 19th century, it is all biomass, especially wood. Some historians think that the Roman Empire collapsed partly because the cost of importing firewood from the far territories exceeded the benefits. More recently, the 1800’s saw the rise of coal and the industrial revolution and a remarkable social transformation, along of course with issues of mining and urban pollution. The 20th century is marked first by the discovery and use of oil and later by natural gas. Since the chart is proportional, it shows how oil and gas took greater importance, but in fact the total amount of energy produced and consumed in the modern world has grown exponentially. So energy from all sources, even biomass has increased in absolute terms.

The global view also hides the great disparity between advanced societies who exploited carbon-based energy to become wealthy and build large middle classes composed of human resources multiplying the social capital and extending the general prosperity. Those societies have also used their wealth to protect to a greater extent their natural environments.

The 21st Century Energy Concern

Largely due to reports of rising temperatures 1980 to 2000, alarms were sounded about global warming/climate change and calls to stop using carbon-based energy. To understand what “decarbonization” actually means, we have two recent resources that explain clearly what is involved and why we should be skeptical and rationally critical.

First, Master Resource describes how the anti-carbon agenda is now embedded in societal structures. Mark Krebs writes Paris Lives! “Deep Decarbonization” at DOE. Excerpts in italics with my bolds.

https://strattonreport.com/wp-content/uploads/2018/01/department-of-energy.jpeg

Despite President Trump’s announcement that the U.S. would withdraw for the Paris Agreement, the basis of that agreement–“deep decarbonization” through “beneficial electrification”–is proceeding virtually unabated. The reason that this is occurring is because it serves the purposes of the electric utility industry and their environmentalist allies, e.g., the Natural Resources Defense Council (NRDC).

According to the Paris Agreement, the fundamental strategy for climate stabilization would be by “deep decarbonization” primarily through “beneficial electrification” powered with “clean energy.” But how are these terms defined exactly?

Deep decarbonization: [4]
The primary strategy of the Paris Agreement for climate stabilization through an 80% reduction in the global use of fossil fuels to “decarbonize” the World’s energy systems by 2050.

Beneficial Electrification: [5]
Replacing consumers direct consumption of natural gas and gasoline, along with other forms of fossil fuels, and on to electricity (with the assumption that electricity generation will be dominated by “clean energy”).

Clean Energy:
Strictly interpreted, it’s just renewables. And more specifically, renewable electric generation. However, many variant definitions exist. For example, DOE includes nuclear, bioenergy and fuel cells as “clean.” And so-called clean coal also appears to qualify via “carbon capture & sequestration” (CCS) as does natural gas, if it is used as a feedstock to make electricity. Energy efficiency (e.g., “nega-watts”) is also deemed “clean energy” by some.

Think about it: Transitioning to a global clean energy economy means there must be a transition from something. By the process of elimination, about the only energy sources not clean are the direct use of fossil fuels. In addition to natural gas direct use, “not clean energy” also includes gasoline, propane, etc. Regardless, “clean energy” (i.e. electrification) is being put forth as the universal cure without disclosure of side effects. In essence the ‘clean energy’ future striven for by EERE exports environmental impacts to others and at high costs. Such non-climate related impacts are ignored.

Whether it’s called regulatory capture, rent seeking or political capitalism, the result is the same: Power accrues to the powerful. In addition to receiving taxpayer funding, advocates of “deep decarbonization” have profited greatly by climate change fear mongering for donations as well as from the deep pockets of Tom Steyer and the like. And now these advocates have officially joined forces with the electric utility industry as evidenced by the recent pact between NRDC and EEI that includes the pursuit of “efficient electrification of transportation, buildings, and facilities.” [21]

In large measure, EERE’s current activities should be viewed as inappropriate subsidies for deep decarbonization via electrification in contravention of President Trump’s proclamation to withdraw from the Paris Agreement. It is also contrary to President Trump’s Executive Order 13783.

Decarbonists in Denial of History

Against this backdrop of imperatives against fossil fuels, we have Lessons from technology development for energy and sustainability by Cambridge Professor Michael J. Kelly (H/T Friends of Science). 

Excerpts in italics with bolds by me

Abstract: There are lessons from recent history of technology introductions which should not be forgotten when considering alternative energy technologies for carbon dioxide emission reductions.

The growth of the ecological footprint of a human population about to increase from 7B now to 9B in 2050 raises serious concerns about how to live both more efficiently and with less permanent impacts on the finite world.

 

Read more on Science Matters

 

Climate change losses will continue to grow

Climate change losses will continue to grow

After our publishing of Huge Impact of Stranded Fossil Fuel Assets, we would like to reiterate on if the Fossil Fuels lose all their value after worldwide disenchantment with this kind of energy procurement, it will cost the global economy $4 trillion. The “time bomb” due to this “Carbon Bubble” from investment in fossil fuels which is likely to burst, wiping off trillions of Dollars from the global economy, according to this research published in Nature Climate ChangeHere is now Out-Law.com which based on a recent Lloyds’s of London study, adds that Climate change losses will continue to grow.


Climate change losses will continue to grow, Lloyd’s warns

Potential economic losses from climate change and extreme weather events will continue to grow in the world’s largest cities, which are already facing an estimated annual average loss of $123 billion, according to a new report.12 Jun 2018

Climate change risks account for around one fifth of potential lost GDP covered by the 2018 Lloyd’s City Risk Index, produced in conjunction with the Centre for Risk Studies at Cambridge University. The most severe risks connected to climate change tracked by the report are tropical windstorms and flooding, which account for $62.6bn and $42.9bn of total tracked risk respectively.

Average global GDP at risk from the threats tracked by the report now exceeds $540bn, or 1.54% of world GDP 2018, up from 1.48% of world GDP at risk in the 2017 report. This figure is not a ‘worst case’ economic loss, but rather combines the size of losses with their likelihoods to arrive at an estimated annual loss.

The report groups threats into five ‘classes’: natural catastrophes; financial, economics and trade; technology and space; geopolitics and security; and health and humanity. Of these, natural catastrophes accounted for the highest overall loss value. However, geopolitics and security risks have grown more rapidly than other threat classes in recent years, with a 40% increase since 2015. This category includes risks such as interstate conflict, civil conflict, terrorism and social unrest.

The report tracks the potential impact of these threats on the world’s largest 279 cities, which together account for 41% of global GDP. Of those, the 10 cities with the highest exposure together account for $127bn worth of potential loss, or almost a quarter of the total. Many of the cities facing the greatest losses, such as Tokyo and London, are also labelled the most “resilient” by the report. However, if every city in the world were to improve its resilience to “very strong”, global risk would reduce by $73.4bn, according to the report.

“The Lloyd’s City Risk Index 2018, which has evolved since its first launch in 2015, is important for insurers and their underwriters in – at least attempting to – understand what the future risk landscape may look like,” said insurance law expert Elaine Quinn of Pinsent Masons, the law firm behind Out-Law.com.

“It is clear that resilience needs to develop in the market around climate-related risk in particular. The report confirms these risks are likely to increase in frequency and severity – in 2017, we witnessed some of the highest insured losses ever from natural catastrophe events. Although much climate-related risk today remains uninsured, growing awareness and pressure means we are seeing the industry really waking up and paying attention, both to its role in closing the protection gap and to its responsibility in proactively mitigating climate change impacts where possible,” she said.

Taken together, man-made risks remain a bigger threat to global economic output than natural disasters, accounting for $320.1bn, or 59% of the total, according to the report. Market crash is the top threat tracked by the report, putting $103.33bn of total GDP at risk; followed by interstate conflict, under which $80bn of total GDP is at risk. Cyber crime is now the 7th most serious threat, putting $36.54bn of global GDP at risk.

The report highlights the role that insurance can play in providing “cash injection following a catastrophic event, allowing cities to rebuild and recover more quickly”. It also recommends that insurers and brokers “invest in developing new products”, particularly in relation to difficult-to-quantify man-made risks.

However, Lloyd’s chair Bruce Carnegie-Brown stressed that cities should also be investing in resilience measures, as well as effective insurance cover.

“The index shows that investing in resilience – from physical flood defences to digital firewalls and enhanced cyber security, combined with insurance – will help significantly reduce the impact of extreme events on cities, improve economic stability and enhance prosperity for all,” he said. “I urge insurers, governments and businesses to look at the index, and work together to reduce these exposures by building more resilient infrastructure and institutions.”