Carbonomics: The Future of Energy in the Age of Climate Change

Climate change is re-shaping the energy industry through technological innovation and capital markets’ pressure.

There’s an abundance of large, low-cost investment opportunities to reduce carbon emissions in power generation, industry, mobility and buildings, and find nature-based solutions, according to Goldman Sachs Research. However, these will not be sufficient to mitigate the worst effects of climate change. Reducing net carbon emissions on this scale requires carbon pricing, technological innovation and a growing role for CO2 sequestration.

Capital markets are taking a leading role in financing the energy transition while reducing investment in new hydrocarbon developments. This is likely to drive the energy transition through higher energy prices, lowering the systemic risk of stranded assets.  A New Age of Restraint is leading to consolidation and higher barriers to entry in the oil & gas industry with the largest companies transitioning to Big Energy and becoming broader, cleaner energy providers and non-OPEC oil supply growth terminating by 2021.