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Concentration of asset owners exposed to power sector stranded assets may trigger climate policy resistance

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  • Angelika von Dulong

    (Humboldt-Universität zu Berlin
    Berlin School of Economics)

Abstract

Thoroughly assessing the owners and distribution of stranded assets in a 2 °C scenario is essential to anticipate climate policy resistance. We employ novel data to analyze owners and incidence of asset stranding in the power sector globally. We show that Asia-Pacific, Europe, and the US are highly exposed to stranded assets, especially coal plants. Stranded assets are highly concentrated in a few asset owners in some countries (e.g., India). Even if owners are more equally exposed (e.g., in the US) they can vary considerably in the asset stranding timing due to differences in plant fleets’ age profile. European, US, and Chinese asset owners own large shares of stranded coal plants abroad. Listed owners may face stranded assets of up to 78% of their share price or more than 80% of their equity. Asset stranding exposure positively correlates with ownership of alternative energy assets. India stands out owning many stranded assets but little alternative energy.

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  • Angelika von Dulong, 2023. "Concentration of asset owners exposed to power sector stranded assets may trigger climate policy resistance," Nature Communications, Nature, vol. 14(1), pages 1-9, December.
    • Handle: RePEc:nat:natcom:v:14:y:2023:i:1:d:10.1038_s41467-023-42031-w
    DOI: 10.1038/s41467-023-42031-w
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    References listed on IDEAS

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    Cited by:

    1. Achim Hagen & Gilbert Kollenbach, 2024. "The Political Economy of Stranded Assets: Climate Policies, Investments and the Role of Elections," Berlin School of Economics Discussion Papers 0033, Berlin School of Economics.

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