London’s HSBC bank suggests an economically suicidal way to slow carbon emissions without laws and treaties.
Climatewire reports,
The International Energy Agency (IEA) last week predicted the world would see a stark increase in oil and coal demand through 2035 that would put the planet firmly on a potentially disastrous average warming path of 3.5 degrees Celsius.
But climate change analysts at London-based HSBC Bank say the door is still open for the world to just barely manage to avoid warming by more than 2 degrees Celsius on average. (The increase, equivalent to 3.6 degrees Fahrenheit, is regarded by scientists as one that is relatively safe.)
The analysts of HSBC, part of the world’s largest banking and financial services group, assert that with new ethical principles that some financial institutions have signed onto, the rapidly declining cost of some green technologies and national legislation will force the early closing of fossil-fuel power plants even in the absence of a global climate deal…
Eighty percent of emissions between now and 2035 may already be locked in because power plants can operate for more than 25 years, the IEA said. The report says that global CO2 emissions for 2011-2035 will be three-quarters of the total for the previous 110 years, or from 1900 until 2010.
Faced with this gloomy scenario, HSBC analysts led by Wai-Shin Chan said that financial institutions are already less willing to risk their capital in inefficient fossil fuel infrastructure. In fact, HSBC was one of five financial institutions that last month published a “Guidance Note on Financing Coal-Fired Power Plants,” committing to adopt policies that specify declining emissions intensity ceilings for plants they lend to.
“As the urgency increases, we expect more banks and institutional investors to factor 2-degree-Celsius targets into their financing decisions,” said Chan…
Eighty percent of emissions between now and 2035 may already be locked in because power plants can operate for more than 25 years, the IEA said. The report says that global CO2 emissions for 2011-2035 will be three-quarters of the total for the previous 110 years, or from 1900 until 2010.
Faced with this gloomy scenario, HSBC analysts led by Wai-Shin Chan said that financial institutions are already less willing to risk their capital in inefficient fossil fuel infrastructure. In fact, HSBC was one of five financial institutions that last month published a “Guidance Note on Financing Coal-Fired Power Plants,” committing to adopt policies that specify declining emissions intensity ceilings for plants they lend to.
A future of ‘stranded fossil fuel assets’?
“As the urgency increases, we expect more banks and institutional investors to factor 2-degree-Celsius targets into their financing decisions,” said Chan.
This is not a new effort.