Coastal Cities Are Increasingly Vulnerable, and So Is the Economy that Relies on Them.

There was a time a decade or two ago when society could have made a choice to write off our massive investment in a fossil fuel-based economy and begin a policy driven shift towards a cleaner renewable infrastructure that could have forestalled the worst effects of climate change. But the challenges of collective action, a lack of political courage, and the power of incumbent pecuniary interests to capture the levers of power meant we did not. The bill is now coming due.

That means that many of our great, low-lying coastal cities are what we call “stranded assets.” GreenBiz founder Joel Makower defines a stranded asset as “a financial term that describes something that has become obsolete or nonperforming well ahead of its useful life, and must be recorded on a company’s balance sheet as a loss of profit.” Makower was talking about Exxon and other companies that built their businesses on the combustion of climate changing fossil fuels, not cities. But the concept easily transfers from businesses built on carbon to cities threatened by carbon’s impact.

Consider Miami. An invaluable, irreplaceable cultural jewel that will be stranded, both figuratively and literally, by climate change.

Read the Harvard Business Review story by Gregory Unruh - “Coastal Cities Are Increasingly Vulnerable, and So Is the Economy that Relies on Them.”

Success in Paris will leave $1000 trillion fossil fuel assets stranded

By Giles Parkinson on 25 August 2015

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f you hear a lot of noise about climate policies and climate action over the next few months in the lead up to the Paris climate conference, it is because there is a lot at stake. According to Citigroup analysts: $US100 trillion of potential stranded assets in the fossil fuel industry.

Giles Parkinson.

A new Citigroup report values the fossil fuel reserves that need to be left in the ground if the world is to meet its targets of trying to limit global warming to 2°C – a target that, according to a new Climate Council report, is actually a lot less “safe” for humankind than the science thought it was just 10 years ago.

Nevertheless, that is the stated target of all governments – including Australia’s – and Paris will endeavour to put in place a mechanism that will allow the world to meet that goal.

Read Giles Parkinson’s story - “Citigroup sees $100 trillion of stranded assets if Paris succeeds”.

Global momentum on climate change will leave many Australian assetts stranded

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illions of dollars of investments in Australia's fossil fuel industries are at risk of becoming white elephants as global momentum builds to address climate change.

As Fairfax Media today begins a series examining climate change policies and politics, experts have spoken out about the growing financial risk posed by investments in fossil fuels.

They say it is now likely the nation will be lumbered with costly unviable assets, especially in coal, as major economies take action to limit global warming to 2 degrees Celsius – an undertaking endorsed this month by G7 nations.

It is claimed that the cost of over-investment during the recent mining boom may already outweigh what would have been the cost of Australia's share in climate action to 2050.

Read the Sydney Morning Herald - “Climate Change: Australia set to be lumbered with cost stranded assets”.