The overwhelming majority of the huge coal reserves in China, Russia and the US should remain unused, according to new research by the UCL institute for sustainable resources.
The study, funded by the UK Energy Research Centre and published in the journal Nature, identifies the geographic locations of existing fossil fuel reserves that should stay in the ground if global warming is to stay below the 2°C target agreed by policymakers.
These include the Middle East, where over 260 thousand million barrels of oil reserves as well as over 60% of the region’s gas reserves should remain untouched. The study also says that fossil fuel resources in the Arctic should remain in the ground and rules out any increase in the development of unconventional oil, such as tar sands.
Co-author Paul Ekins, director of the UCL Institute for Sustainable Resources, advised energy companies to rethink the huge budgets they spend on searching for, and developing, new fossil fuel resources, which last year totalled $670 billion.
“Investors in these companies should also question spending such budgets. The greater global attention to climate policy also means that fossil fuel companies are becoming increasingly risky for investors in terms of the delivery of long-term returns. I would expect prudent investors in energy to shift increasingly towards low-carbon energy sources,” said Ekins.
