What does it say when the risk-takers see potential damages as too high to cover even with premium increases? It doesn’t take a genius to figure the problem will only get worse as Earth’s rate of warming increases and the price tags of climate-related disasters rise.
From ‘natural’ disasters causing property damage, to climate mitigation measures rendering fossil fuel assets unburnable, to potential impacts of climate change on agricultural production, energy, food, insurance, real estate, and other sectors, it’s clear that private sector companies and all kinds of investments stand to suffer significant losses as a consequence of climate change.
So the risk managers of last resort will not be governments, but the community, acting in concert with the non-fossil fuel businesses, finance and investment sectors who now stand to be destroyed if the stranglehold of the fossil fuel industry is not rapidly broken.
If you are dead, you cannot mount a comeback. If all life on Earth were destroyed by, say, a large comet impact, there would be no revival. Ruin is forever.
It is well to remember that none of people making forecasts can know the one thing they all desperately want to know: the future.
Having courted economic Armageddon in the financial sector, might we be capable of repeating the trick in the energy sector?
My answer is a resounding yes. We are doing so. On multiple fronts.
Each new technology, regardless of benefits,brings its own risks. In many complex situations where there are multiple questions with poorly constrained answers, it is folly to expect that we can use formal risk assessments to guide current actions.
Two new reports say climate change could cause the next financial crisis. From London, Bob Ward, LSE lead author of "Unburnable: Carbon 2013: Wasted capital and stranded assets." Australia’s Climate Institute, John Connor on coal’s risky future. Plus Nancy LaPlaca: why sunny Arizona burns coal.
Current U.S. energy policy is, in fact, a hodgepodge of disconnected policies designed for specific constituencies with no coherent goal. What never gets asked and answered definitively in the policy debate is this: What should our ultimate goal be and when should we aim to achieve it?