Carbon Tracker Annual Review 2020 SUMMARY

At Carbon Tracker, our mission is to help markets and state actors align energy system capital allocation with the finite planetary limits of the Paris Agreement. Our success is measured by our ability to mobilise investors, policymakers and regulators into action around climate risk resulting in an orderly winddown of fossil fuels.

Ten years ago, at its inception, Carbon Tracker re-framed the climate problem as a financial risk, terming and popularising the key concepts the "carbon bubble”, "stranded assets", and “unburnable carbon”. Our work has moved these concepts from obscurity to the core of any discussion on climate change and financial risk management, helping to mobilise investors and financial regulators into action.

While awareness of climate risk as a financial risk has increased substantially, we know that with some investors there is more work to be done. Our focus on investors remains core to our theory of change. We also recognise that a range of policymakers, regulators and NGOs equally value the same analytical rigour and financial logic that drives our work. Even in heavily regulated markets, our analysis helps stakeholders make the case to decision-makers as to why they should turn away from fossil fuel technologies on economic grounds.

By motivating investors, we create powerful new allies to support policy action on climate.

Carbon Tracker: Diversity, Equity & Inclusion

The Story so far

An important part of our culture has always been that varied points of view are valued. As a think tank it is important that different points of view are considered, as the problems we are trying to solve are cross cutting and complex. Our recent annual surveys have shown that people feel safe expressing themselves freely. Honest discourse is encouraged. We are keen to maintain a culture where we do not shy away from conversations which can foster learning.

However, DEI is more than having good intentions. Once we started exploring inclusion in more depth, we became aware of how organisational norms might implicitly discourage certain behavioural styles or silence certain voices.

What actions have we taken?

Learning has been a key part of our DEI activities, with regular trainings for the team. Our Diversity Champion, together with the DEI Committee and the operations team, worked to embed our organisational commitment to DEI, by issuing our DEI statement, Anti-racisim statement and formalising the role of the Diversity Champion and the committee.

We continue to review our internal processes, striving to remove systemic barriers. Flexible ways of working have always been a part of our culture and we are currently exploring what hybrid working will look like for our team once we come out of the pandemic. Recruitment remains a key focus, where we have introduced improvements and incorporated diversity metrics for monitoring progress.

Looking to the future

We will strive to continue improving by learning how to actively listen to others’ perspectives, have difficult conversations, refrain from blame and judgment. We will solicit feedback to continue exploring how our behaviours and company practices might be impeding the push for a culture that supports learning, equality, and mutual respect.

Oil, Gas & Mining

In 2020, our work in the oil, gas, and mining sector workstream thrived. The report Fault Lines examined how companies are adapting to the transition to a net zero carbon world. Absolute Impact focused on emissions “ambition” announcements. The team released analyst notes including Handbrake Turn, Fanning the Flames, Groundhog Pay, and Pipe Dreams, which dealt with the inevitable policy response, remuneration, and pipeline projects.


Over the last year we enjoyed several successes. In June, a Goldman Sachs report noted that fossil fuel projects were being stranded by higher cost of capital, a component of our theory of change. Goldman also incorporated our analysis into its product for SFERS. Our research helped campaigns to stop both UKEF support for overseas fossil fuels and the Keystone XL pipeline. BP’s asset-level “Paris compliance test” is based on a shareholder resolution that we fed into and their plan to reduce production in absolute terms referenced our work. When Eni announced absolute emissions targets, and a peak to oil production, they echoed the narrative we spoke about in previous reports.

In 2020, we partnered with Vivid Economics for the Handbrake Turn report and ShareAction wrote a briefing based on our analysis. We look forward to building on these partnerships and continuing to work with Bloomberg on updating their app. Our work was featured in numerous outlets such as the Financial Times, The Guardian, Reuters, AFP and Bloomberg News.

Power & Utilites

We focussed on accelerating the transition from coal to clean power and preventing a switch to natural gas. In 2020 this centered around the reports How to Waste Over Half a Trillion Dollars, Political Decisions, Economic Realities, and How to Retire Early, which were covered by outlets like Reuters, the Guardian, BBC, and AFP.

The team underwent a change in our leadership, and the refreshed team has renewed efforts to build on our past successes and strengthen our capacity and capabilities in Asia.


In 2020, success meant working to stop the building of new coal, particularly in Asia, and building out our gas modelling coverage. We engaged with Korea Electric Power Corporation (KEPCO) and Vietnam’s EVN to present our analysis of the risks associated with their continued investments in coal power and what they could do to mitigate some of these risks. We have also been approached by utilities including EDF, Enel, RWE, and Fortum.

Working with government officials, state-owned utility companies and investors, we have moved the debate on stranded assets within the power sector leading to announcements from governments and investors in South Korea and Japan. Additionally, Global Energy Monitor (GEM) reported that Indonesia, Vietnam, Bangladesh, and the Philippines have cancelled nearly 45 gigawatts of proposed coal power projects in 2020.

Our work was referenced by Nordea Asset Management when it urged companies building coal-fired plants in Vietnam to withdraw due to climate change risks and economic inefficiency. In the U.S., our data was used to support the decision of New-York City’s largest pension funds to divest an estimated $4 Billion from fossil fuels investments. In September 2020, Vattenfall registered Moorburg coal power plant for the auctioning of compensations to be shut down, echoing the findings in our Moorgburg case study from 2015.

In 2020 we partnered with RMI, IEEFA, ICSC and SFOC on key reports. Being an official partner to the Powering Past Coal Alliance (PPCA) enabled us to provide research and analytics that helped members navigate the various energy transition risks while powering government engagement activities. We hosted events with the UK government, webinars in the Philippines, presented at the PPCA Summit, and have become a go-to for analysis and insights for several UK FCDO posts in South-East Asia.

Energy Transition

Now is the time for investors, politicians and companies to recognise and prepare for the energy transition. Our work focuses on accelerating that change and saving investors from the consequences of building out of more fossil fuel assets and pursuing business-as-usual thinking.

To help investors adapt to this reality we released reports such as Decline and Fall, Nothing to Lose but Your Chains, and The Future’s Not in Plastics. These outputs exposed the flaws in the fossil fuel sector’s arguments as to why business as usual will continue once the pandemic passes.

We concentrated on engaging with equity investors because they have a profound influence on corporate strategy. Reaching hedge funds can drive change and inspire the rest of the industry to act by taking a lead and making money out of it. Our message is also deeply applicable to bond investors and to banks who are becoming increasingly concerned about holding stranded assets.


The impacts of the energy transition and our work to identify it are already materialising. The share of the energy sector in the S&P 500 has fallen from 13% to 3% in a decade. According to the IEA, the cost of capital of the oil and gas industry has risen by 3% since 2010 whilst that of the renewable sector has fallen by 3%. Moreover, 2020 and the disruption of COVID may well be a profound turning point in the way investors allocate capital. Renewable energy companies have performed excellently despite the economic headwinds and challenges of the pandemic and continue to raise capital rapidly, in contrast to the challenges the fossil fuel sector has faced this year.

Our work was amplified by delivering 96 presentations to various audiences including TEDxCarbonTracker, IRENA, JP Morgan, Axa Investors, Newton, BNEF, Globuc, and officials with the UK Government. In addition, we partnered with the World Economic Forum and Systemiq on projects and reports.

Regulatory & Policy

Our research is focused on getting key audiences to address the dangers of stranded liabilities. We released the following reports on this topic: The Flip Side, It’s Closing Time, and Billion Dollar Orphans. They detailed the problems created by oil and gas companies failing to meet their asset retirement obligations, and what it will mean for communities and taxpayers.

By working with our consultants and journalists, we were able to take this issue to a larger audience. These efforts were assisted by our participating in roundtables and other events and responding to requests from groups including WildEarth Guardians.


Our biggest challenge is getting industry, regulators, and elected officials to address a problem they thought they could ignore. Despite resistance, we are starting to capture the attention of industry, with executives calling on us to discuss our research. Although 2 of 3 Texas Railroad Commissioners attacked our work, since we first we published our reports, Colorado and North Dakota started to improve bonding regimes. In addition, the Biden Administration has suggested plugging wells as a policy tool to be implemented.


In addition to our regulatory work, in 2020 a key part of our work was rebooting our accounting program. Although just getting off the ground the program engaged with FRC on its ongoing reporting on climate risk and we responded to a consultation to the FCA.

Our work has historically focused on climate risk disclosure in the front end of corporate reports. The accounting program will pivot to focus on the financial statements. These efforts are driven by the theory that if the accounts reflect climate risks, the entire market will price these risks in. The key challenges here involve getting regulators to enforce requirements and auditors to follow them. Going forward this work will focus on market regulators, standard setters and auditors.

Investor Outreach

Investor outreach is critical to our achieving our overall mission. To advance this work, in 2020, and as part of our work with the CA100+, we updated and published company profiles for 32 power and utility companies. The profiles included the retirement schedules for coal and gas generation assets, disclosure and climate target analysis. We also updated company data for 33 upstream oil & gas companies which included their capex, disclosure and climate target analysis for CA100+ benchmark.

The key audiences for this work are global investor signatories to the CA100+ initiative (about 500+ institutional investors) that are focused on engagement with 33 oil & gas companies and 32 power utilities with the highest carbon emissions as selected by CA100+.


The impact of this work can be seen on different fronts. Providing data and analytics to the CA100+ can enable investors to push companies to align their business models and supply chains with the goals of the Paris agreement. We can limit upstream oil & gas projects by identifying unneeded oil & gas projects. In terms of dealing with the power sector, if we are successful coal and gas plants will be retired in a Paris Agreement aligned pathway and companies will announce each plant’s retirement year.

Through these efforts we have seen Carbon Tracker’s narrative and analysis become the major driving force for climate change as a financial material risk for financial markets. We see our focus on restricting capex for higher costs oil & gas projects are increasingly being adopted by CA100+ investors. This work has resulted in changes in the climate targets set by BP, Total, Shell, ENI and Repsol.

Framing & winning the debate in print & broadcast media

In 2020, our work was covered in 6200 stories worldwide and our analysts were interviewed by major international broadcasters including CNBC, the BBC, CNN, Sky News, ABC and national TV and radio stations.

Influential and key publications like The Financial Times, The New York Times and national newspapers worldwide are increasingly incorporating elements of our core analysis into their coverage, with the prospect of ‘stranded assets’ and the ‘carbon budget’ timebomb increasingly touched upon.

The publicity has driven more institutional investors, lawmakers and regulators to our website, which has, in turn, opened doors to more speaking opportunities for our staff to continue spreading the word and positively influencing the move to a low-carbon future. Winning the debate in the headlines and acting as an independent voice in the financial space has been a key strategy.

Carbon Tracker’s media team has been supported throughout by Greenhouse PR who assisted with both media campaigns and staff media training.

Spreading our voice through our growing webinar programme

2020 was our busiest year yet on the events front, with a jump to virtual events from March onwards. Speaking across over 170 events and webinars, including 15 Carbon Tracker branded events, the team presented our analysis and thought leadership to over 20,000 people.

Highlights include the launch of Carbon Tracker’s webinar platform with the report Absolute Impact and TEDxCarbonTracker hosted as part of Countdown. Events were held during Climate Week NYC and the two London Climate Action Weeks in July and November in collaboration with an array of partners such as Reuters, BNP Paribas, Finance Watch, MSCI, Systemiq, E3G and PRI.

Carbon Tracker’s webinar programme went from strength to strength in 2020, with steady growth in attendance and popularity, with no sign yet of digital fatigue. The webinar recordings are made available on YouTube which has boosted views and engagement on this platform too.

Communications in numbers...

Carbon Tracker works with partners across the climate, finance and NGO space, as well as with Governments and media. These collaborations span the organisation from research to events to inform and bring together experts, market leaders and changemakers to achieve our mission. Working closely with partners has allowed us to reach new audiences, dive deeper into analysis and have more impact.

Since we began a decade ago, appreciation of the financial risks related to climate change and the transition to a lower carbon economy has grown significantly.

Our increasing efforts towards building out our Theory of Change means we are now in a position to take decisive actions to achieve our mission. We aim to demonstrate to a growing audience of investors that it is in their self-interest to avoid fossil fuel investments that would take us beyond Paris, and that they should reallocate capital to drive change.

Going forward, we seek to bring active and activist investors into the fray. Doing so will require deeper analysis of company business plans and economic assessment of whether companies are truly entering into a managed decline of their fossil fuel operations and the economic arguments for doing so. This analysis will further “assertive engagement” activities. We anticipate that as the urgency of dealing with climate instability increases, investors will encourage companies to adopt particular transition roadmaps and mobilise boards.

In 2021, a new workstream will be devoted to debt investments in fossil fuels—this work will identify the scope of continued investments and the risks those pose to fixed income (and related private equity) investments. This work will illuminate which investors have truly sought to decarbonise the entirety of their portfolios to meet targets adopted by financial firms.

We look to expand our presence by increasing the number of research and outreach staff in the United States and Europe. We also aim to increase our presence in Asia by focusing on countries where we can maximize our impact through close collaborations with local partners.

And finally,

Thanks to our 2020 funders!


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