Mark Carney reckons most fossil fuels “un-burnable”?

Mark J. Carney - mine's about this big and its fully sustainable Or so energylivenews says (thanks to J). Their text is:

Governor of the Bank of England Mark Carney appears to agree most fossil fuels can’t be used if the world is to avoid climate change. At a World Bank event on Friday, he is quoted as saying: “The vast majority of reserves are unburnable.” This is a reference to the idea of a so-called carbon bubble – when investors in oil, gas or coal suppliers lose out on money because the reserves can’t be used.

I've bolded his words, the rest is editorial interpolation. I find this particularly irritating. If I'm reading about what Carney thinks, I want to read his words, not what someone else thinks about his words. I'm prepared to read analysis of his words, but it has to be primarily based upon what he said. Searching, I can find a bit more in the Graun:

The governor of the Bank of England has reiterated his warning that fossil fuel companies cannot burn all of their reserves if the world is to avoid catastrophic climate change, and called for investors to consider the long-term impacts of their decisions. According to reports, Carney told a World Bank seminar on integrated reporting on Friday that the “vast majority of reserves are unburnable” if global temperature rises are to be limited to below 2C. Carney is the latest high profile figure to lend his weight to the “carbon bubble” theory, which warns that fossil fuel assets, such as coal, oil and gas, could be significantly devalued if a global deal to tackle climate change is reached.

Here again we've got the same very brief quote surrounded by acres of unreliable interpolation. Did Carney actually warn about "catastrophic climate change"? In those words? We don't know. Perhaps, as the text from the Graun above suggests, he only qualified his words with "if global temperature rises are to be limited to below 2C", which is a very different matter. Indeed, what did he mean by "reserves" or "fossil fuel companies"? If he's merely saying that we can't burn all the coal without going over 2 oC then meh: that's just the bleedin' obvious, though the fact that he choose to say the bleedin' obvious might be interesting. Nor is the meaning of "vast majority" obvious. If by "vast majority" he means, say, 90% then I think I'd find that surprising and non-obvious. But I'm not really up with burnable-resources proportions, please feel free to inform me. The Graun links to but that, too, has the same tantalisingly brief quote about my topic. There's a bit more quote:

The value of integrated reporting, he argued, was to help investors think about “not just things that can be managed in the short term” but also “costs companies are likely to be exposed to as policy responds to challenges” like climate change. He referred to a “tragedy of horizons” – the market failure by which actors including some investors, companies and governments are not looking far enough ahead to coming problems like the environment, even though these are known to them.

and here's he's on a reasonable topic for an econ-bod, possible market failures by not looking ahead far enough. Whether he's right about that I don't know; what I actually wanted to know was what he'd said about GW, since that was the headline.

The forum referred to is, I believe, How Integrated Reporting Facilitates Transparency and Financial Stability; October 10, 2014; Washington DC. But they don't seem to have published any text. Anyone know where to find what he actually said?

I'm slightly puzzled this didn't cross my radar earlier.


* Bank [of England] prods insurers about climate plans?
* Investors warn of ‘carbon bubble’ as Shell predicts climate regulation will hit profits?

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I remember him talking about "stranded assets" and - IIRC - arguing that investors needed to recognise that some of their assets (fossil fuels) would not realise their value. Assuming we do want to avoid warming by much more than 2 degrees, then this would seem reasonable. I'm not sure if this can be cast as has been done in the quotes that you include, but - presumably - if we are going to avoid much more than 2 degrees of warming, then presumably a reasonable fraction of the reserves will have to remain unburned (well, unless we discover a way for CCS to play a significant role).

By ...and Then Th… (not verified) on 01 Nov 2014 #permalink

Per wiki
"To calculate the radiative forcing for a 1998 gas mixture, IPCC 2001 gives the radiative forcing (relative to 1750) of various gases as: CO2=1.46 (corresponding to a concentration of 365 ppmv), CH4=0.48, N2O=0.15 and other minor gases =0.01 W/m2. The sum of these is 2.10 W/m2. Inserting this to the above formula, we obtain CO2e = 412 ppmv."

With CO2 nearer 400ppmv, the CO2e must now be at least 450.

Then AR5 says
"Mitigation scenarios in which it is likely that the temperature change caused by anthropogenic GHG emissions
can be kept to less than 2 °C relative to pre-industrial levels are characterized by atmospheric concentrations
in 2100 of about 450 ppm CO2eq (high confidence)."

So we can only burn what we sequestrate. Err well there is 500ppm Co2eq if you allow more likely than not scenario.

BP world energy review has world wide proved reserves of Oil 238 billion tonnes, Natural gas 195 trillion cubic metres, Coal 891 billion tonnes.

Seems like there might be a lot of ways to do the calculations according to assumptions so I will let you do them.

I probably didn't understand the point of your post, but burnable or not, I'm going to guess that an awful lot of the reserves will indeed be burned.

BGR provides estimates of proven reserves as well as SWAG's resources:………

I used the last link, to make an Excel spreadsheet ~3 years ago.

Using the 2009 annual production rates for the various FF's with the reserves + resources for the various FF's, gives:

Oil ~ 70 years
Gas ~ 140 years
Hard Coal ~ 3000 years
Soft Coal (Lignite) ~ 4500 years

Weighted Average ~ 1700 years (lots and lots of coal)

The BGR resource estimates for 2013 are say ~10% below their 2010 report.


By Everett F Sargent (not verified) on 02 Nov 2014 #permalink

Per June 2014 BP report proved resources of oil = 53 years of current consumption.

If we are at 478 ppm CO2e and are willing to allow 500 that looks like about 11 years of current rate of growth of CO2. So perhaps 20% burnable perhaps none though these rise if we sequestrate some from atmosphere.

Will work out to be lower proportions for gas and coal.

Did you find the IEA quote:
“Not more than one-third of proven reserves of fossil fuels can be consumed prior to 2050 if the world is to achieve the 2˚C goal,” the IEA says.

[But proven reserves of coal are vast (from memory), so that doesn't necessarily say anything very useful about oil or gas -W]

The Canadian CCS plant seems a kind of ironic prank, considering that the CO2 bound for sequestration is being used to mobilize petroleum resources mostly bound to be burned.

By Doug Bostrom (not verified) on 02 Nov 2014 #permalink

I didn't mean to imply that the investment funds were supporting his specific statement; just that they seem to be thinking along the same lines

[Its hard to know what lines he is thinking on; that was the point of my post. We're only getting teensy little fragments of his thinking.

As for what investment funds are thinking - there's nothing in that article, only links to other articles. One says "the investors call on government leaders to provide a “stable, reliable and economically meaningful carbon policy”, and to develop plans to phase out subsidies on fossil fuels." Which is eminently sensible economics, but not what Carney is saying. And the other is better, I mean more to the point. That says "a group of 70 investment managers... have launched the first ever coordinated campaign aimed at making the large energy and power companies disclose how they assess the risks of climate change... have sent letters to 40 of the world’s major oil and gas, coal and electric power companies... We would like to understand (the company’s) reserve exposure to the risks associated with current and probably future policies for reducing greenhouse gas emissions by 80% by 2050”, says the investors’ letter." To mind mind, anyone sending that kind of letter to a coal-producing company is a bozo or just in it for the PR; it certainly makes no financial sense -W]

By Holly Stick (not verified) on 02 Nov 2014 #permalink

Dr. Connolley:

The answer to your question is that it does not matter. Just more faux, delusional "softening" of Fleet Street prior to the next IPCC unexploded bombshell.

Global oil and gas corporations are much more powerful than the BoE: recent history shows that Her Majesty's Armed Forces has been used as private security for the "Seven Sisters".

Cheap, portable and powerful liquid hydrocarbons will be burned until something else replaces it.

2K or more is baked in.

> [And what fraction of the plant's CO2 is captured? -W]

Interesting question. At least if we make a start we can improve over time.

Since coal has a heat value of 20,000 kJ/kg, for producing one we require (10765 / 20000) 0.538 kg of coal. This translates to (0.538 x 100 x 1,000) 53800 kg/hr (53.8 T/hr) of coal for an output of 100 MW.

suggests about 58 tonnes per hour for 110MW coal plant
They claim there will be over 1 million tonnes of CO2 captured each year which is 272k tonnes of carbon. 58 tonnes per hour if in continuous operation would be 500k tonnes per year.

So as a rough estimate they seem to be claiming over half will be captured.

[That's a larger fraction than I was expecting, but bears it out. It will be interesting to see how it pans out -W]

He's perfectly right about the reserves being 'unburnable'-- carbon amounts to a rock forming mineral , and barring in situ combustion, the lignite alone would take a population of ten billion centuries to burn at present rates .

W: That's a depressingly non-quantitative quote.

Sorry, have a look at the other link - it at least tries to give a back-of-the-envelope sketch of the financials.

[That's much better on the costs for the CCS. But it then falls down on trying to compare with "something else" -W]