Patricia DeMarco Ph.D.

"Live in harmony with nature."


Rapid Response to the Climate Emergency = Move Investments away from Coal, Oil and Gas

Patricia M. DeMarco

March 6, 2020

The world needs to reach carbon neutrality by 2050 to preserve viable conditions for life on Earth as we know it. The current Nationally Determined Carbon (NDC) emissions target for the United States of America is to reduce emissions by 26–28 per cent from 2005 levels by 2025.[1]  The climate emergency is upon us. The people of 2050 are here now – my niece will be 28; my grandchildren will be in their early 40s, my children will be looking at retirement in 2050. We need to mobilize the transformation to a non-fossil-based economy on a scale equivalent to the mobilization of World war II, a shift that happened within four years.  

For the last three years, we have moved backwards in the actions to reduce GHG emissions through three specific policy efforts of the Trump Republican administration. First, Trump’s Republicans replaced Obama’s Clean Power Plan with the recently issued Affordable Clean Energy (ACE) rule. While the Clean Power Plan, targeted to emissions from coal power plants, would have reduced power sector emissions by roughly 32 per cent, the ACE rule is expected to reduce them by roughly only one per cent.[2] This is far short of the NDC goal for the United States under the Paris Climate Accord.

Second, Trump’s Republican administration froze the vehicle emissions and fuel economy standards for cars and light trucks until 2026, meaning that the average fuel efficiency will remain at 35 miles per gallon (mpg), rather than rising to 54 mpg. According to analysis by the Rhodium Group, this will increase emissions from the transportation sector by 28–83 Million tons of CO2 equivalent per year by 2030, with the ultimate amount dependent upon the effect of oil prices on consumption.[3]

Third, Trump’s Republican administration has weakened or rescinded 95 environmental regulations deemed “burdensome” to business to accelerate production of oil and natural gas, opening federal lands including National Wildlife Preserves and National Parks to drilling.  Emissions from heightened oil and gas production and renewed coal use or deferred plant retirements have added 2.2% to the GHG burden. According to the International Energy Agency’s Global Energy and CO2 Report, U.S. government policy is centered on the concept of “energy dominance,” which reflects a strategy to maximize energy production, expand exports and be a leader in energy technologies. Environmental deregulation is a central focus, though it may have (negative) implications for the emissions trajectory. [4]

Policy U-Turn required to meet climate goals by 2050 UN Emissions Gap Report.
In spite of Trump policies that ignore climate change and exacerbate emissions, overall Americans are increasingly concerned about this issue. Recent national surveys show that 67% of the total population believes climate change is happening now, and 60% are worried or very worried about climate change with 67% expressing concern for future generations and 69% concerned about harm to plants and animals. Support is very strong for funding research into renewable energy sources (83%) and for regulating carbon dioxide as a pollutant (72%) or setting strict limits on existing coal -fired power plants (68%).  A surprising 70% believe that environmental protection is more important than economic growth. [5]    

A group of 25 governors representing over half of the country’s population and $11.7 trillion in US Gross Domestic Product have joined the U.S. Climate Alliance, a coalition committed to reducing GHG emissions in line with the goals of the Paris Agreement.[6]  In addition, many national and international corporations have made climate commitments a part of their operating strategies.  

Furthermore, the economics of utility scale solar and wind now compete favorably with all fossil fuels and new nuclear power. As the life cycle costs continue to fall and energy storage and load management technologies improve rapidly, the utility sector is continuing its move away from coal, diesel and natural gas.[7] The US energy- related CO2 emissions fell by 14 per cent between 2005 and 2017, while the economy grew by 20 per cent.[8] The often-touted tie of environmental emissions to economic growth is clearly intercepted by advances in technology and responsible policies at the sub-national levels. But much more rapid movement to reduce the levels and pace of the GHG emissions is critically necessary for us to meet carbon neutrality targets by 2050.

What tools are available now to advance this rapid transformation? 

We can stop the flow of money to these capital-intensive fossil industries. Government subsidies hard-wired into law have supported mature coal, oil and gas production and service industries for more than fifty years, long past the time of spurring innovation.  For example, leases and sales of public lands at favorable rates is one frequently unrecognized form of subsidy.  In 2018, our public lands and waters produced 39% of total U.S. coal (282 million tons), 21% of total U.S. oil (826 million barrels) and 14% of total U.S. gas (4.3 trillion cubic feet). Since taking office, the Trump administration has offered more than 461 million acres of public lands and waters for oil and gas leasing from January 2017 through January 2020. Since January 2017, the Trump administration has sold 4,928 parcels (or more than 9.9 million acres) of public lands to oil and gas companies for development, including more than 5 million acres onshore and more than 4.9 million offshore acres. Development of these leases could result in lifecycle emissions between one billion and 5.95 billion Metric Tons of Greenhouse Gas emissions (CO2 plus methane.)[9] Removing such subsidies will require changes in law, a ponderous process certain to be stifled by the Trump Republican administration and Congress in the control of Republican majorities.

While we work to change the political balance to favor these necessary legislative measures, there are three ways citizens, corporations and communities can influence the flow of money to oil gas and coal interests immediately.  We can stop new investments in coal, oil, and gas extraction, production and services; divest from existing investments in these industries; and move investments into the high growth areas of renewable energy, regenerative agriculture, and green chemistry.  All of these opportunities hold great promise for economic growth while sustaining a viable living ecosystem.[10]

University of Pittsburgh students and alumni call on Board of trustees to divest (January 28, 2020) /photo credit Mark Dixon Blue Lens LLC.

Money can move quickly, and the shift away from fossil industries is already growing. Larry Fink, Chairman of Blackrock Investment wrote to his shareholders, “… investors are asking how they should modify their portfolios. They are seeking to understand both the physical risks associated with climate change as well as the ways that climate policy will impact prices, costs, and demand across the entire economy…we will see changes in capital allocation more quickly than we see changes to the climate itself. In the near future – and sooner than most anticipate – there will be a significant reallocation of capital.”[11]

The U.S. shale oil industry hailed as a “revolution” has burned through a quarter trillion dollars more than it has brought in over the last decade. It has been a money losing endeavor of epic proportions.[12] In spite of the growth in emissions and investments in oil and gas development driven by the Trump Republican administration, the global trend has been away from investments in new fossil resource production. Blackrock’s $7.4 trillion in investment holdings is a huge driver, a larger amount than the entire country of Japan. Other major investors have also moved to divest from fossil fuels because of concern about climate change, including the European Investment Bank, The Church of England’s Pension Board, and large corporations such as Microsoft.  Sustainable investing began long ago as a focus for charitable contributions, but the recent movement began in the 1960s and its popularity has soared over the past few years with a 38% hike in assets since 2016 alone.[13]

Investments in clean energy stocks have outperformed fossil industry investments over the last decade.  Driven by global commitments to decarbonization, and the growth of renewable industries to power emerging economies in India, Africa and Asia, clean energy industries have seen increases from 32% to 58 % in the last five years. In addition, the rapidly falling cost of solar and wind technologies has driven confidence in these investments. The cost of solar has fallen 85 per cent since 2010, while wind power has dropped about 50 per cent, according to Bloomberg New Energy Finance.[14]  Williams Market Analytics reports that from 2014 to 2019 Extraction Production and Extraction Services industries have fallen 85%  while S&P 500 industries, including large utilities, have grown 69% in the same period.[15] As the hard evidence for sound investments in clean energy industries mounts in global markets, the Trump Republican administration policy position of forcing favor to coal, oil and natural gas becomes increasingly untenable.

As we look for ways to secure a better future for our children and families, it is increasingly important to recognize that current Trump Republican administration policies are looking backwards to a world that no longer exists.  The Energy Information Administration characterizes the carbon emissions profile and expectations thus: “After falling during the first half of the projection period, total U.S. energy-related carbon dioxide emissions resume modest growth in the 2030s, driven largely by increases in energy demand in the transportation and industrial sectors; however, by 2050, they remain 4% lower than 2019 levels.”[16] This level falls far short of any reasonable goal to reach carbon neutrality by 2050. The longer we persist in subsidizing and investing in fossil industries, the less opportunity we will have to capture the rapidly growing clean energy options for the future. It is critical that we begin to make the policy U-Turn away from fossil fuel industries to avoid locking in another thirty years of fossil industry infrastructure.  The energy industries that adapt and move their focus away from fossil- based resources are the ones that will thrive in the future. 

 Continuing ‘Business As Usual’ will come at the cost of destruction of the ecosystem services of the living earth.  The Global Futures Report evaluated the cost of climate change in terms of the effect on six critical ecosystem services such as the pollination of crops, protection of coasts from flooding and erosion, supply of water, timber production, marine fisheries and carbon storage.[17] Reduced supply of these six ecosystem services alone would lead to a drop of 0.67% in annual global GDP by 2050 (compared to a baseline scenario in which there is no change in ecosystem services by 2050). This would be equivalent to an annual loss of US$ 479 billion compared to the baseline scenario, assuming an economy of the same size/structure as in 2011. Over the period between 2011 and 2050, the total cumulative loss would be US$ 9.87 trillion (3% discount rate).[18] In contrast, in a ‘Global Conservation’ scenario – in which the world adopts a more sustainable development pathway and safeguards areas that are important for biodiversity and ecosystem services — annual global GDP would be 0.02% higher (US$ 11 billion) by 2050, than in a baseline scenario of no change in ecosystem services, generating an annual net gain of US$ 490 billion per year compared to the Business As Usual scenario.[19]

If the United States established a priority for use of federal lands to sequester carbon and protect ecosystem services instead of prioritizing extractive industry development, the economic impact and emission reductions would be substantial. At the national level, the US Geological Survey estimates that terrestrial ecosystems (forests, grasslands, and shrublands) on Federal lands sequestered an average of 195 Million Metric Tons of CO2 – Equivalent per year between 2005 and 2014, offsetting approximately 15 percent of the CO2 emissions resulting from the extraction of fossil fuels on Federal lands and their end-use combustion. Lifecycle emissions from the production and combustion of fossil fuels produced on public lands as a result of the federal leasing program are equivalent to over 20% of total U.S. GHG emissions.[20]

The US government has many tools at its command to support and accelerate a transition to a renewable- energy- based economy.  For example, The Department of the Interior could drastically reduce needless methane pollution by reinstating a federal methane and natural gas waste regulation informed by science-based recommendations; eliminate production subsidies and loopholes for fossil energy; require developers to mitigate climate impacts; and rapidly phase down leasing and production. Additionally, the federal government should protect major carbon storing landscapes and invest in programs, incentives, and partnerships that promote responsible renewable energy development and public land restoration to create new sustainable economic opportunities.[21]

We can address the social disruptions already stressing coal, oil and gas-dependent communities by shifting investment and public policy support toward community-driven clean energy solutions.  In the four Re-Imagine community exercises I have participated in over the past three years, every community has developed serious plans for economic development in non-fossil industries.  The options range from solar farms to glass recycling centers; from growing hemp and bamboo to replace materials made from petrochemical feedstocks to building passive solar design eco-villages for affordable housing. I am convinced that if we unleash the ingenuity of the American people and support these initiatives with public policy that enables rather than stifles renewable energy, regenerative agriculture and green chemistry solutions, we will see a rebirth of America on a scale not seen in this century.

Citations and Resources:

[1]. United Nations Environment Programme (2019). Emissions Gap Report 2019. UNEP, Nairobi.        

[2]. Amelia T. Keys, Kathleen F. Lambert, Dallas Burtrow, Johnathan J. Buonocore, Jonathan I. Levy, and Charles T. Driscoll. “The Affordable Clean Energy rule and the impact of emissions rebound on carbon dioxide and criteria air pollution emissions.” Environmental Research Letters. April 9, 2019. Volume 14, Number 4.

[3]. Trevor Houser, Kate Larsen, John Larsen, Peter Marsters, and Hannah Pitt. “The Biggest Climate Rollback Yet?” Rhodium Group Note. August 2, 2018.   

[4]. International Energy Agency. Global Energy and COStatus Report 2019. United States Data to 2018. March 1, 2020.

[5] Jennifer Marlon, Peter Howe, Matto MildenbergerAnthony Leiserowitz and Xinran Wang. Yale Climate Opinion Maps 2019. September 17, 2019.  Accessed March 1, 2020.

[6].  United States Climate Alliance. December 2019.

[7].  Lazard Levelized Cost of Energy and Levelized Cost of Storage 2019. Lazard Insights. November 7, 2019.    Accessed February 26, 2019. 

[8] . Annual Energy Outlook 2020. U.S. Energy Information Administration [EIA] 2018 data.  

[9]. The Wilderness Society. Climate Report 2020: Greenhouse Gas Emissions from Public Lands. March 4, 2020

[10]. See the Global Futures Report for a new assessment of the economic cost of failing to preserve the ecosystem services that support global economies, and the value of a conservation strategy instead. Accessed March 4, 2020 

[11]. Larry Fink. Chairman’s Letter “To Our Shareholders.” Blackrock Annual Report 2018. March 2, 2020

[12]. Rebecca Elliott and Christopher Matthews. “Oil and Gas Bankruptcies Grow as Investors Lose Appetite for Shale.” Wall Street Journal. August 30, 2019.   Accessed March 1, 2020.

[13]. Steve Norcini. “Sustainable Investing: Redefining Investing for the Long Term.” Wilmington Trust, Investment Advisory. Q4 2019.  Accessed March 1, 2020.

[14]. Harry Sanderson. “Clean Energy shares streak ahead of fossil fuel stocks.” Financial Times. October 1, 2019.  Accessed March 3, 2020.

[15]. Williams Market Analytics.

[16] . Energy Information Administration. Annual Energy Outlook 2020. (Data 2018)

[17]. Johnson, J.A., Baldos, U., Hertel, T., Liu, J., Nootenboom, C., Polasky, S., and Roxburgh, T. 2020. Global Futures: modelling the global economic impacts of environmental change to support policy-making. Technical Report, January 2020.  105 pages.  Accessed March 3, 2020.

[18]. Roxburgh, T., Ellis, K., Johnson, J.A., Baldos, U.L., Hertel, T., Nootenboom, C., and Polasky, S. 2020. Global Futures: Assessing the global economic impacts of environmental change to support policy-making. Summary report, January 2020. Page 3.   Accessed March 3, 2020.

[19]. Roxburgh, T., Ellis, K., Johnson, J.A., Baldos, U.L., Hertel, T., Nootenboom, C., and Polasky, S. 2020. Global Futures: Assessing the global economic impacts of environmental change to support policy-making. Summary report, January 2020. Page 4.   Accessed March 3, 2020

[20]. Merrill, M.D., Sleeter, B.M., Freeman, P.A., Liu, J., Warwick, P.D., and Reed, B.C., 2018, Federal lands greenhouse gas emissions and sequestration in the United States—Estimates for 2005–14: U.S. Geological Survey Scientific Investigations Report 2018–5131, 31 p.,

[21]. Nathan Ratledge, Steven J. Davis and Laura Zachary. “Public lands fly under the climate radar.” Nature Climate Change. February 2019. vol.9:89-93. Available at    Accessed March 2, 2020

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Interview on The Union Edge Radio 770 AM Pittsburgh

18 Nov 2014

I was pleased to be the guest of Rosemary Trump on the Charles Showalter show  The Union Edge on 770 AM in Pittsburgh.  We talked about the Keystone XL Pipeline and some of the implications for jobs, the environment the potential and benefits of renewable resources, and climate change.  The Senate Vote failed to approve the project this evening. You can hear the transcript of the show here: