Carbon Tracker’s comment on UCL study 

7th January 2015

Today the internationally renowned scientific journal Nature published a new research by University College London (UCL) that finds global fossil fuel reserves are approximately three times higher than the amount that can be safely burned by 2050 to keep global warming exceeding 2 degrees Celsius.

Over the past two years, momentum has been building behind the concepts of unburnable carbon and stranded assets as originally conceived by Carbon Tracker. This latest research adds weight not only to the notion that current global fossil fuel reserves exceed the 2°C carbon budget, but that globally there are vast amounts of less developed coal, oil and gas resources in addition to these reserves.

James Leaton, Research Director of Carbon Tracker said:

“Investors are already using the detailed cost curves Carbon Tracker produced to start identifying how low demand and price scenarios could play out. The UCL research confirms that expensive coal, oil sands, Arctic and unconventionals are beyond the carbon budget. It is a reminder that companies need to justify spending more capital on high-cost projects given the clear direction of travel towards a low carbon economy.”

The UCL research states that:

  •  Coal reserves are highly exposed, in particular, to the threat of carbon constraints, with over 80% being deemed unusable to 2050 to maintain a safe climate. Oil reserves are comparatively less exposed, although a third remain unburnable, while half of global gas reserves are vulnerable.

UCL study Graph on reserves


Source: The geographical distribution of fossil fuels unused when limiting global warming to 2 6C, Christophe McGlade1 & Paul Ekins, UCL Study
  • Canada has the lowest utilisation of its oil reserves, with the Middle East having to leave most oil in the ground in absolute terms; the United States can safely consume the highest percentage of its oil reserves relative to other countries and regions.
  • Carbon Capture and Storage only has a modest effect on alleviating the scale of fossil fuels that must be kept in the ground.

Conclusions like these reiterate the need for investors to question fossil fuel companies about how their business models are aligned with a necessary energy transition to avoid dangerous warming.