Climate Policy & Stranded Assets: A Public Finance and Financial Economics Perspective

Date and Time

Tuesday, 27 June: Start at 12:00 with lunch reception; End: 18:00 (evening program at 19:00)

Wednesday, 28 June: Start at 9:15; End: 16:15

Venue

Historical premises of the National and Kapodistrian University of Athens

Organizing committee: Ottmar Edenhofer, Matthias Kalkuhl, Till Requate and Jan Steckel

The ratification of the Paris Agreement is expected to induce more ambitious climate policies at the international, national and sub-national level. Carbon pricing schemes emerge around the globe as well as complementary policies such as standards or subsidies for clean technologies. These policies affect various existing assets, ranging from commodity prices to sunk investments, which might be reflected in shares of companies exposed to resource extraction, energy production and marketing. Additionally, as fossil resources, related industries and associated scarcity rents may generate substantial public revenues today, climate policy could also affect fiscal and macroeconomic stability of governments. The exposure of assets to climate policy and its associated financial and macroeconomic risks have therefore become looming questions for institutional financial investors, policy makers and economists. The pre-conference aims to invite research that explicitly looks at interlinkages between climate policy, financial markets and questions of public finance.

Keynotes

Simon Dietz: Climate change and the financial system - an overview
Rick van der Ploeg: Climate Policy, Adjustment Costs and Stranded Assets: A Financial Perspective
Christian Gollier: The Climate Beta

Accepted paper presentations

Build Today, Regret Tomorrow? Infrastructure and Climate Policy (Elizabeth Baldwin; Yongyang Cai; Karlygash Kuralbayeva)
Instrument Choice and Stranded Assets in the Transition to Clean Capital (Julie Rozenberg; Adrien Vogt-Schilb; Stephane Hallegatte)
Carbon price uncertainty, heterogeneous expectations and stranded assets (Matthias Kalkuhl; Jan Steckel; Sabine Fuss; Ottmar Edenhofer)
Quantifying scenario specific asset stranding: Implicit global and local stranding of electricity sector assets in leading scenarios (Alexander Pfeiffer; Adrien Vogt-Schilb; Daniel J. Tulloch; Cameron Hepburn)
Do Markets Trump Politics? Evidence from Fossil Market Reactions to the Paris Agreement and the US Election (Samson Mukanjari; Thomas Sterner)
Will assets be stranded or bailed out? Expectations of investors in the face of climate policy (Marie-Theres von Schickfus; Suphi Sen)
Carbon Taxes, Oil Monopoly, and Petrodollar Recycling (Waldemar Marz and Johannes Pfeiffer)
Climate financial bubbles: How market sentiments shape the transition to low-carbon capital (Antoine Godin, Emanuele Campiglio; Elena Dawkins; Eric Kemp-Benedict)