Within the Decarbonomics theme there are several sub-themes which our research will cover:
- Declining oil demand
- Implications for petro exporters
- Transition to EV including top-down policy and private sector initiatives
- New/replacdement energy sources
- Government policies: spending, taxing, regulation
Recent Research Examples
Green push will increase in the run-up the 20th Party Congress in Q4/22, supporting commodity prices and low carbon related equities.READ ME
What is Decarbonomics?
The economics and policy of reducing global reliance on greenhouse gas (aka “carbon”) emissions in energy production, manufacturing, transportation and other sectors of the economy.
Why are we covering Decarbonomics?
This theme is inextricably linked to geopolitics – China/US trade and tech frictions, global energy policy, government-driven transformations – and fits right in to where we already have deep strength. We will leverage our existing strengths to help clients understand and act on what will be a major economic driver for the foreseeable future.
An ever more important investment theme
- Climate change is a topic of critical importance for the world, and with it, the global economy.
- It’s at or near the forefront of many governments’ agendas: from Biden’s Earth Day summit in April to the 26th UN climate change conference (COP26) in Scotland in November.
- Major economies (EU/UK, Japan, South Korea) have committed to going net-zero emissions by 2050; China has targeted the same for 2060. With the Biden administration on board too, a structural alignment of similar policy drivers across the US, Europe and Asia will galvanize change in a way that has not been possible in the past, aided by the falling costs of renewables and batteries that make the former already cost-competitive with their fossil fuel rivals in many areas.
- In the auto sector, a growing number of regions (e.g. UK, China, Japan, California/Massachusetts) have recently brought forward their targets for phasing out new fossil-fuel-only cars to the 2030s, spurring automakers like GM, Ford and Jaguar Land Rover to commit to similar targets.
- ESG fits in naturally with this theme. With the US Fed recently joining the global climate-focused network of central banks (NGFS) and China also stepping up its green finance plans, this will propel more corporations towards lower-emissions investments.
- Decarbonomics is a key policy, economic and corporate strategy driver both now and for the next decade. It will converge with and be inextricable from the fourth industrial revolution, in which 5G, AI, IoT, smart grids, smart EVs/self-driving cars and smart cities will transform the world we live in today – creating new fractures for the global economy as traditional supply chains get disrupted, but also generating immense new growth opportunities.
Our Decarbonomics research team is led by Grace Fan working closely with Christopher Granville each of whom have more than two decades experience as analysts of energy & renewables policy and market impact across the Americas and EMEA. Other members of the team include Marcus Chenevix, Rory Green and Jon Harrison who bring further US, Mid East, Asian and ESG specialist knowledge to bear. This core team draws on the support of the wider analyst team and their work includes other major disruptive themes such as “silicon as the new oil”.
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