The Initiative sought to ensure that continued investment in the fossil fuel sector neither commits society to dangerous anthropogenic climate change, nor requires prohibitively expensive mitigation or remediation measures from future taxpayers.
Early work by the team found that the Fifth Assessment Report of the United Nations Intergovernmental Panel on Climate Change (IPCC), published in 2015, had underestimated the total amount of carbon that can be emitted before we break the international agreement to keep global temperatures to well below 2ºC. They worked to provide estimates that are more accurate, and these findings influenced subsequent research, including the IPCC 2018 Special Report on Global Warming of 1.5°C.
It is nevertheless likely that the fossil carbon reserves owned by public or private investors likely already vastly exceed that “carbon budget”. To meet the aims of the Paris Agreement would require at least two-thirds of known fossil fuel reserves to remain unburned or, if they are burned, for the carbon dioxide generated to be safely and permanently stored out of the atmosphere. If this doesn’t happen, if the fossil fuel industry continues along its ‘business as usual' path, the global temperature will rise 1.5°C before 2040 and 2°C by the 2060s.
To prevent catastrophic climate change we must stop fossil fuels from causing global warming within 20 to 40 years. This means a shift to predominantly renewable energy sources, together with a commitment to ensure that, from mid-century, one tonne of CO2 is safely and permanently disposed of for every tonne generated by any continued fossil fuel use. We have to unravel in half a human lifetime an energy system of extraction, processing, transportation and delivery that has taken generations to build.
The key problem is that the powerful entities that will determine if we achieve this or not, companies with fossil fuels at their heart, don’t answer to science, or politics, or public opinion – they answer to shareholders and they answer to investors. And the demands of investors and shareholders are most often for short-term increases in financial returns rather than for the long-term wellbeing of the planet – and that was the key to what the Net Zero Investment team developed next.