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Investors Release Guide To Increase Climate Change Engagement From Oil And Gas Organisations.



oil by partofasystem via flickr

In an attempt to ensure that oil and gas companies do more to tackle the climate change challenge, global investors are updating guidance on climate risks facing the sector.

Global investors from Europe, North America, Asia and Australia have today published an updated second edition of their guide setting out the challenges facing the sector and investor expectations for how oil and gas companies must act to adapt their business strategies to a 2°C climate change pathway.

Launching Investor Expectations for Oil and Gas Companies: Transition to a Lower Carbon Future

Stephanie Pfeifer, CEO of the Institutional Investors Group on Climate Change (Europe) said, “Today the global investor community is setting out as clearly as possible their expectations for oil and gas companies on actions required to address climate change risks. Our decision to update this guide directly reflects the requirements of the Paris Agreement. Going forward, asset owners and fund managers will need to know how oil and gas companies – and particularly the boards accountable for overseeing them – see the future impact of climate change on their activities and how they plan to align their business model with the greenhouse gas reductions required to deliver binding international agreements.”

Stephanie Maier, lead author of the revised guide and Head of Responsible Investment Strategy & Research for Aviva Investors added, “The oil and gas sector represents trillions of dollars in market capitalisation. Long-term investors therefore want to ensure that oil and gas companies have appropriate governance and capital discipline to respond to the changing market dynamics that are arising from the policies and actions put in place to limit global warming. Given the transition and physical risks these companies face from climate change, we believe that they have a duty to disclose how they are responding to these changes. We have seen some strategic announcements from oil and gas companies for more resilient low carbon business strategies. However, it is vital for everyone’s long term prosperity that they do more in this respect and do not undermine robust policy action that drives a well-managed transition to a low carbon economy.”

Andrew Logan, Director of the Oil & Gas Program at Ceres and the Investor Network on Climate Risk (North America) said, “No matter the outcome of the US election, global policy momentum and rapid technological change are combining to create significant risks for the oil and gas sector. Investors are increasingly concerned that the current business strategies of many companies may not be financially sustainable given these ongoing trends. During the current proxy season investors are showing unequivocally through shareholder resolutions to companies including Exxon and Chevron that they expect the oil and gas sector to address carbon asset risk by assessing the impact of a 2°C scenario on their future resilience.”

Emma Herd, Chief Executive of the Investor Group on Climate Change (Australia) and speaking also for the Asia Investor Group on Climate Change, said: “Some of the largest oil and gas companies by revenue are based in Asia, in the fastest growing economies in the world. These companies are highly exposed to carbon constraints and will face mounting pressure as investors seek to determine whether they are doing enough to change their capital allocations to curb emissions and align their business strategies to a 2C global warming scenario. The Marrakech Communique adopted at COP22 also explicitly recognised the oil and gas sector as the largest source of methane globally – a potent greenhouse gas – so if we are to stand a chance of meeting the Paris goals these companies will also be expected to demonstrate they are taking steps to curb these emissions from oil and gas extraction, transportation and processing activities”.

About the guide

Investor Expectations for Oil and Gas Companies: Transition to a Lower Carbon Future updates a previous guide (Investor Expectations – Oil and Gas Company Strategy) that was first published in December 2014 and has formed the basis of effective investor engagement over the past two years with the boards and management of oil and gas companies. The revised guide is intended to support further constructive engagement with the sector following the Paris Climate Agreement. It is focused in particular on how companies in this sector are governing and managing the transition risks and opportunities associated with a climate trajectory of no more than 2°C of global warming and are developing the business strategy required to adapt through the transition to a sustainable low carbon energy system. The guide groups investor expectations in five areas of concern:

• Governance – are board and management processes well enough defined to ensure adequate oversight of climate-related risk and effective planning for a transition consistent with 2°C and efforts to pursue 1.5°C?
• Strategy – is the management of climate-related risks and opportunities integrated into business strategy well enough to ensure business models will be robust, responsive and resilient in the face of a range of energy transition scenarios.
• Implementation – is scenario analysis and ‘stress testing’ well enough embedded into key business planning processes and investment decisions?
• Transparency & disclosure – does the company disclose its operational emissions in the annual report and/or on the corporate website. How good is the company’s view of, and response to, the material climate related risks and opportunities outlined in the guide?
• Public policy – does the company engage with public policy makers and other stakeholders to support development of cost-effective policy measures to mitigate climate-related risks and low carbon investments? Is there broad oversight and transparency regards the company’s public position, lobbying activity and political spending on climate-related regulatory issues (including carbon/methane emissions, energy and transport)?

Investors expectation – Oil & Gas Company Strategy was developed by the Institutional Investors Group on Climate Change with support from other investor networks in North America (Ceres’ INCR), Asia (AIGCC) and Australasia (IGCC) in the Global Investor Coalition (, an umbrella for more than 250 institutional investors representing assets worth over USD24 tn. It is one of several produced to support investor engagement with key sectors to curb carbon asset and climate risk including mining, utilities and automotive companies. It is intended to be used in tandem with Institutional Investors’ Expectations of Corporate Climate Risk Management.( )

Investors groups in the GIC also collaborate to drive climate action in key policy forums, including the G7 & the G20. In August this year investors wrote to the G20 heads of state calling on G20 nations to double global investment in clean energy by 2020, tighten climate disclosure mandates, develop carbon pricing and phase out fossil fuel subsidies. Shortly before COP22 in Marrakech, the GIC published a fact sheet highlighting examples of actions institutional investors around the world have taken during 2016 and since the Paris Agreement was finalised. The Marrakech Communique was adopted at COP 22 in Morocco on November 14, 2016.


Responsible Energy Investments Could Solve Retirement Funding Crisis




Energy Investments
Shutterstock / By Sergey Nivens |

Retiring baby-boomers are facing a retirement cliff, at the same time as mother nature unleashes her fury with devastating storms tied to the impact of global warming. There could be a unique solution to the challenges associated with climate change – investments in clean energy from retirement funds.

Financial savings play a very important role in everyone’s life and one must start planning for it as soon as possible. It’s shocking how quickly seniors can burn through their nest egg – leaving many wondering, “How long your retirement savings will last?

Let’s take a closer look at how seniors can take baby steps on the path to retiring with dignity, while helping to clean up our environment.

Tip #1: Focus & Determination

Like in other work, it is very important to focus and be determined. If retirement is around the corner, then make sure to start putting some money away for retirement. No one can ever achieve anything without dedication and focus – whether it’s saving the planet, or saving for retirement.

Tip #2: Minimize Spending

One of the most important things that you need to do is to minimize your expenditures. Reducing consumption is good for the planet too!

Tip #3: Visualize Your Goal

You can achieve more if you have a clearly defined goal in life. This about how your money can be used to better the planet – imagine cleaner air, water and a healthier environment to leave to your grandchildren.

Investing in Clean Energy

One of the hottest and most popular industries for investment today is the energy market – the trading of energy commodities. Clean energy commodities are traded alongside dirty energy supplies. You might be surprised to learn that clean energy is becoming much more competitive.

With green biz becoming more popular, it is quickly becoming a powerful tool for diversified retirement investing.

The Future of Green Biz

As far as the future is concerned, energy businesses are going to continue getting bigger and better. There are many leading energy companies in the market that already have very high stock prices, yet people are continuing to investing in them.

Green initiatives are impacting every industry. Go Green campaigns are a PR staple of every modern brand. For the energy-sector in the US, solar energy investments are considered to be the most accessible form of clean energy investment. Though investing in any energy business comes with some risks, the demand for energy isn’t going anywhere.

In conclusion, if you want to start saving for your retirement, then clean energy stocks and commodity trading are some of the best options for wallets and the planet. Investing in clean energy products, like solar power, is a more long-term investment. It’s quite stable and comes with a significant profit margin. And it’s amazing for the planet!

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What Should We Make of The Clean Growth Strategy?



Clean Growth Strategy for green energy
Shutterstock Licensed Photo - By sdecoret |

It was hardly surprising the Clean Growth Strategy (CGS) was much anticipated by industry and environmentalists. After all, its publication was pushed back a couple of times. But with the document now in the public domain, and the Government having run a consultation on its content, what ultimately should we make of what’s perhaps one of the most important publications to come out of the Department for Business, Energy and the Industrial Strategy (BEIS) in the past 12 months?

The starting point, inevitably, is to decide what the document is and isn’t. It is, certainly, a lengthy and considered direction-setter – not just for the Government, but for business and industry, and indeed for consumers. While much of the content was favourably received in terms of highlighting ways to ensure clean growth, critics – not unjustifiably – suggested it was long on pages but short on detailed and finite policy commitments, accompanied by clear timeframes for action.

A Strategy, Instead of a Plan

But should we really be surprised? The answer, in all honesty, is probably not really. BEIS ministers had made no secret of the fact they would be publishing a ‘strategy’ as opposed to a ‘plan,’ and that gave every indication the CGS would set a direction of travel and be largely aspirational. The Government had consulted on its content, and will likely respond to the consultation during the course of 2018. And that’s when we might see more defined policy commitments and timeframes from action.

The second criticism one might level at the CGS is that indicated the use of ‘flexibilities’ to achieve targets set in the carbon budgets – essentially using past results to offset more recent failings to keep pace with emissions targets. Claire Perry has since appeared in front of the BEIS Select Committee and insisted she would be personally disappointed if the UK used flexibilities to fill the shortfall in meeting the fourth and fifth carbon budgets, but this is difficult ground for the Government. The Committee on Climate Change was critical of the proposed use of efficiencies, which would somewhat undermine ministers’ good intentions and commitment to clean growth – particularly set against November’s Budget, in which the Chancellor maintained the current carbon price floor (potentially giving a reprieve to coal) and introduced tax changes favourable to North Sea oil producers.

A 12 Month Green Energy Initiative with Real Teeth

But, there is much to appreciate and commend about the CGS. It fits into a 12-month narrative for BEIS ministers, in which they have clearly shown a commitment to clean growth, improving energy efficiency and cutting carbon emissions. Those 12 months have seen the launch of the Industrial Strategy – firstly in Green Paper form, which led to the launch of the Faraday Challenge, and then a White Paper in which clean growth was considered a ‘grand challenge’ for government. Throughout these publications – and indeed again with the CGS – the Government has shown itself to be an advocate of smart systems and demand response, including the development of battery technology.

Electrical Storage Development at Center of Broader Green Energy Push

While the Faraday Challenge is primarily focused on the development of batteries to support the proliferation of electric vehicles (which will support cuts to carbon emissions), it will also drive down technology costs, supporting the deployment of small and utility-scale storage that will fully harness the capability of renewables. Solar and wind made record contributions to UK electricity generation in 2017, and the development of storage capacity will help both reduce consumer costs and support decarbonisation.

The other thing the CGS showed us it that the Government is happy to be a disrupter in the energy market. The headline from the publication was the plans for legislation to empower Ofgem to cap the costs of Standard Variable Tariffs. This had been an aspiration of ministers for months, and there’s little doubt that driving down costs for consumers will be a trend within BEIS policy throughout 2018.

But the Government also seems happy to support disruption in the renewables market, as evidenced by the commitment (in the CGS) to more than half a billion pounds of investment in Pot 2 of Contracts for Difference (CfDs) – where the focus will be on emerging rather than established technologies.

This inevitably prompted ire from some within the industry, particularly proponents of solar, which is making an increasing contribution to the UK’s energy mix. But, again, we shouldn’t really be surprised. Since the subsidy cuts of 2015, ministers have given no indication or cause to think there will be public money afforded to solar development. Including solar within the CfD auction would have been a seismic shift in policy. And while ministers’ insistence in subsidy-free solar as the way forward has been shown to be based on a single project, we should expect that as costs continue to be driven down and solar makes record contributions to electricity generation, investment will follow – and there will ultimately be more subsidy-free solar farms, albeit perhaps not in 2018.

Meanwhile, by promoting emerging technologies like remote island wind, the Government appears to be favouring diversification and that it has a range of resources available to meet consumer demand. Perhaps more prescient than the decision to exclude established renewables from the CfD auction is the subsequent confirmation in the budget that Pot 2 of CfDs will be the last commitment of public money to renewable energy before 2025.

In short, we should view the CGS as a step in the right direction, albeit one the Government should be elaborating on in its consultation response. Its publication, coupled with the advancement this year of the Industrial Strategy indicates ministers are committed to the clean growth agenda. The question is now how the aspirations set out in the CGS – including the development of demand response capacity for the grid, and improving the energy efficiency of commercial and residential premises – will be realised.

It’s a step in the right direction. But, inevitably, there’s much more work to do.

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