ImpactAlpha, Dec. 6 – The risk that fossil fuel investments will become ‘stranded assets’ went from fringe thesis to mainstream preoccupation in what must be near-record time.
It’s not a theory: this week, the Spanish oil producer Repsol took a $5.3 billion writedown to reflect the falling value of its oil and gas assets in a decarbonizing world.
That bankers, investors and now oil companies are taking seriously the value-collapse of fossil fuel assets is in large part testament to Campanale’s dogged research and advocacy.
The sustainable investment analyst founded Carbon Tracker Initiative, and in 2011 produced the landmark report Unburnable Carbon, followed two years later by Wasted Capital and Stranded Assets.
This week he helped launch the Fossil Fuel Non-Proliferation Treaty, modeled on the treaty limiting nuclear weapons. The aim: international collaboration around the peaceful phasing out of coal, oil and natural gas.
Expect more write-downs to come. The Paris climate agreement, and follow-up meetings like COP25 now underway in Madrid, call for carbon emission reductions, but not yet constraints on fossil fuels.
An aim of the non-proliferation project: an accounting of fossil fuel projects representing future emissions as a starting point for a true reckoning. A registry would help determine what licenses must be revoked, which oil rigs decommissioned and by how much assets written down.
“We know fossil fuels need to stay in the ground,” Campanale told ImpactAlpha on the sidelines of the Financial Times’ Investing for Good Conference in New York. “The real question is whose and how.”
When Campanale isn’t plotting campaigns to sunset the oil industry, he sometimes fills in on the campaign trail for his identical twin brother, David, who is running for a seat in the U.K. parliament. Oh, and happy birthday, Mark and David!
Amy Cortese contributed reporting.