The momentous climate accord reached last weekend in Paris recognizes three powerful and unyielding economic and ecological trends. These were prompted by the collision of the resource-abundant development approach of the 20th century with the increasingly dire environmental conditions of the 21st.
By far, the most important has been that Mother Earth is fuming. Hurricanes have drowned two American cities in recent years. Mammoth wildfires have raced across the American West. Toxic algae contaminate drinking water drawn from warmer and more polluted rivers and lakes all over the world. In June 2013, a flood that scientists linked to climate change killed thousands of people in Uttarakhand, India, and wrecked that Himalayan state’s hydropower sector.
Deep droughts have been especially worrisome. Brazil’s largest city, America’s most populous state and nearly all of South Africa now contend with serious water scarcity. Earlier this year, a paper in the Proceedings of the National Academy of Sciences of the United States added fresh, peer-reviewed details about how a destructive drought from 2007 to 2010 in Syria played a role in igniting the calamitous civil war there in 2011. With the farm economy ruined, more than one million farmers and their families ended up in unstable, resource-scarce cities, where people were inspired by the Arab Spring to rebel against the country’s authoritarian rule.
The second trend has been the growth of influential civic campaigns to push for climate action, and against big infrastructure projects, especially energy and mining undertakings.
In the United States, President Obama in November rejected the Keystone XL oil pipeline, the target of a broad and organized citizen protest movement. In India in 2010, farmers and activists, afraid of flooding and loss of farmland, blockaded access roads and brought construction of the 2,000-megawatt Lower Subansiri Dam to a halt. And in Peru, villagers in the Andes highlands near Cajamarca halted development of Newmont Mining’s planned $5 billion Conga gold and copper mine because of local concerns about water pollution. The proposed mine remains stalled.
The third and latest piece of this narrative is the growing apprehension in global financial markets about approving big, carbon-based energy projects and, to a lesser extent, the construction of hydropower dams.
Three reports in recent years underscore the anxiety.
In 2009 researchers at the Potsdam Institute, a German research group, determined that keeping the rise in global temperatures at or below 2 degrees Celsius, the goal set by the United Nations, meant that no more than 565 additional gigatons of carbon dioxide could be emitted into the atmosphere. At current levels of global carbon emissions — about 36 gigatons annually — those additional gigatons would be released into the atmosphere by the early 2030s.
Then, in 2011, the Carbon Tracker Initiative, a British research group, reported that 2,795 gigatons of carbon was held in the coal, oil and natural gas reserves of fossil fuel companies and carbon-rich countries. If burned, the emissions would vastly exceed the ceiling set by the Potsdam Institute.
And in 2012, the climate activist Bill McKibben explained “global warming’s terrifying new math” in an article in Rolling Stone. In order to prevent what scientists project could be disastrous planetary heating, he argued, 80 percent of known fossil fuel reserves would have to be kept in the ground.
Big banks and other financial institutions have been coming to terms with the market risks of leaving untouched — that is, stranded — fossil fuel assets valued at more than $20 trillion. A disinvestment campaign led by Mr. McKibben’s organization, 350.org, has recruited more than 500 institutions, with assets valued at over $3.4 trillion, that have pledged to remove fossil fuel companies and projects from their investments.
For the time being, the global coal sector is most imperiled. Natural gas and renewable energy sources are replacing coal-fired plants in the United States and Europe. American coal production and exports are declining, along with international prices for coal. Europe’s largest insurer, Allianz, recently joined California’s pension funds and Norway’s sovereign wealth fund, the world’s largest, in selling its coal investments.
In August, the Commonwealth Bank of Australia, that nation’s largest bank, said it would not fund the proposed Carmichael mine in Queensland, the biggest coal mine ever proposed in Australia. The mine’s role in adding to carbon emissions, potential damage to the Great Barrier Reef from coal transport ships, and a vigorous opposition campaign led by Greenpeace were factors in the bank’s decision.
In November, the Financial Stability Board, which promotes global financial stability for the Group of 20 nations, announced that it was establishing a task force, headed by the former New York mayor Michael Bloomberg, to encourage businesses to voluntarily disclose how much risk they face from adjusting practices because of climate change.
Also last month, the attorney general of New York, Eric T. Schneiderman, won an agreement with Peabody Coal, the largest publicly traded coal company in the world, in which the company agreed to disclose to investors the risks the company faces from new climate regulations and turbulence in the coal market. Peabody’s stock value, which four years ago reached nearly $1,100 a share, is now trading at under $10 a share.
Still, there’s one vital place that remains unconvinced of the dangers posed by warming temperatures: the United States Congress. Republican dogma about climate change and climate science seems bound to rupture. The California drought, the Uttarakhand flood, the São Paulo drought, Syria’s civil war, and so many other recent ecological and economic disasters linked to climate change are fraying the party’s thinning tissue of denial.
Keith Schneider is the senior editor of Circle of Blue, a nonprofit news organization that reports on the global competition among water, energy and food. He is a former national correspondent for The New York Times.