{"id":2463,"date":"2016-12-22T12:30:17","date_gmt":"2016-12-22T17:30:17","guid":{"rendered":"http:\/\/journals.law.harvard.edu\/elr\/?p=2463"},"modified":"2023-07-25T15:57:38","modified_gmt":"2023-07-25T19:57:38","slug":"our-money-is-safe-but-the-planet-is-not-how-the-carbon-bubble-will-cause-havoc-for-the-environment-but-not-the-stock-market","status":"publish","type":"post","link":"https:\/\/journals.law.harvard.edu\/elr\/2016\/12\/22\/our-money-is-safe-but-the-planet-is-not-how-the-carbon-bubble-will-cause-havoc-for-the-environment-but-not-the-stock-market\/","title":{"rendered":"Our Money is Safe, but the Planet Is Not: How the Carbon Bubble Will Cause Havoc for the Environment, but Not the Stock Market"},"content":{"rendered":"

By Breanna Hayes,\u00a0Managing Editor, Vermont Journal of Environmental Law<\/em><\/p>\n

I. Introduction<\/h2>\n

Human use of fossil fuels dates back to prehistoric times.[1]<\/a>\u00a0 Before the Industrial Revolution, humans mostly relied on wood, wind, and water as energy sources.[2]<\/a>\u00a0 But as the Industrial Revolution progressed, humans developed a dependence on fossil fuels.[3]<\/a>\u00a0 In addition, the advancements of the Industrial Revolution allowed for the human population to grow rapidly.[4]<\/a>\u00a0 Combined, these facts indicate that, not only were humans developing a greater dependence on fossil fuels, but also there were more humans on earth than ever before.\u00a0 With a greater number of humans, fossil fuel dependence was even more severe.<\/p>\n

While humans blindly relied on fossil fuels for centuries, by the 1940s scientists began predicting the impact that fossil fuels would have on the environment.[5]<\/a>\u00a0 In 1949, M. King Hubbart made a prediction known as \u201cHubbart\u2019s Peak.\u201d[6]<\/a>\u00a0 According to this prediction, fossil fuels would peak in the 1970s.[7]<\/a>\u00a0 Hubbart further predicted that despite the peak in fossil fuels, humans would still have a rising demand for energy.[8]<\/a>\u00a0 According to Hubbart\u2019s predictions, the energy sector would need to replace fossil fuels with renewable energy sources to meet the demand.[9]<\/a>\u00a0 As predicted, oil peaked in 1971, with other fossil fuels soon to follow.[10]<\/a>\u00a0 Yet, by the time the world began to acknowledge Hubbart\u2019s peak, fossil fuels had \u201cbecome so firmly interwoven into human progress and economy, that changing this energy system would drastically alter the very way we have lived our lives.\u201d[11]<\/a> \u00a0While the transition will be difficult, many nations around the world have begun to move away from fossil fuels.[12]<\/a>\u00a0 A major victory in the movement from fossil fuels was the Paris Agreement, which has been ratified by more than 100 countries.[13]<\/a>\u00a0 In the Paris Agreement, countries committed to, \u201cholding the increase in the global average temperature to well below 2\u00b0C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5\u00b0C above pre-industrial levels, recognizing that this would significantly reduce the risks and impacts of climate change\u201d[14]<\/a><\/p>\n

While world governments are progressing towards greener energy to combat climate change, a problem arises in the energy industry.\u00a0 Publicly traded energy companies are a considerable market force,[15]<\/a> despite demand for fossil fuels continuing to decrease and the demand for renewable energy sources rising.[16]<\/a>\u00a0 In 2015, even though fossil fuel prices were at a multi-year low, \u201cover half of global power capacity additions in 2015 came from wind, solar, hydro and nuclear.\u201d[17]<\/a>\u00a0 Additionally, the Paris Agreement, formulated in December 2015, creates the expectation that policy-makers will advance progressive ideas to help countries meet the agreed-upon two degree Celsius cap.[18]<\/a>\u00a0 An obvious way to mitigate this change is for energy companies to start diversifying portfolios to include renewable sources.[19]<\/a>\u00a0 However, timing is key for both the market and the climate.\u00a0 Concerning the market, \u201cIf [companies] move too quickly, money could be left on the table from their fossil fuels business. But too slowly, and they could miss their window of opportunity.\u201d\u00a0 On the other hand, the world has a very restricted carbon budget if it is going to honor the two degree Celsius cap embodied in the Paris Agreement.[20]<\/a><\/p>\n

This article focuses on the window of time that companies have to shift from fossil fuels to renewable energy. The article provides a quick overview of public companies and the use of stock.\u00a0 Then, the article discusses the \u201cCarbon Bubble\u201d and how it compares and contrasts to both the dotcom and housing market bubbles. Finally, the article discusses the environmental impact of the energy industry\u2019s financial choices.<\/p>\n

II. Background: Brief Overview of Public Companies<\/h2>\n

Public companies differ from private companies in two ways.\u00a0 First, public companies trade stock on the public stock exchange and second, public companies make regular, legally required disclosures to the Securities Exchange Commission (SEC).[21]<\/a>\u00a0 By selling stock on the public stock exchange, any person can purchase stock in a company.\u00a0 In addition to individual citizens, institutional investors\u2014such as pension funds, insurance companies, and mutual funds\u2014may purchase public stock.[22]<\/a>\u00a0 The SEC requires publicly traded companies to make regular disclosures to protect both individual and institutional investors.[23]<\/a>\u00a0 According to SEC, public companies must \u201cdisclose meaningful financial and other information\u201d so there can be a \u201ccommon pool of knowledge for all investors to use to judge for themselves whether to buy, sell, or hold a particular security.\u201d[24]<\/a><\/p>\n

When a company decides to sell stock to the public, multiple factors determine the price for the stock and the price can fluctuate constantly.\u00a0 Regardless of what a person pays for a share of stock, they are entitled to the same thing\u2014a share of the company\u2019s equity.\u00a0 The company\u2019s equity can be determined by a simplified formula.\u00a0 All companies have assets and liabilities.\u00a0 Assets are the fixed infrastructure and inventory the company can liquidate, and liabilities are the debts a company owes.\u00a0 Because a company\u2019s equity is subordinate to its debts, equity can be determined by subtracting the liabilities from the assets.\u00a0 The equity is then divided by the amount of stock the company issued. For example, if a company owns $50 million worth of assets and has $20 million in liabilities, the company\u2019s equity would be $30 million.\u00a0 If the company issued 2 million shares, each share would be worth $15 of the equity.<\/p>\n

As mentioned, a stock\u2019s price is not locked in to its current value of equity.\u00a0 Rather, many factors, such as investor enthusiasm may alter the price. [25]<\/a>\u00a0 \u00a0If investors believe that the company will grow, stock may sell higher than it is worth in equity.\u00a0 Yet, a problem arises when stock price increases rapidly but the assets of the company do not catch up.\u00a0 When assets\u2019 prices appreciate beyond their value, a market bubble emerges.[26]<\/a>\u00a0\u00a0 For example, \u201cInvestors may bid up the price of an asset in the belief that its price will continue to rise and when the ever-higher price results in an ever-smaller number of buyers, the price eventually declines rapidly.\u201d[27]<\/a>\u00a0 Inevitably, the bubble bursts and the price drops.[28]<\/a><\/p>\n

Some are concerned that energy companies are creating a bubble.[29]<\/a>\u00a0 The concern stems from how energy companies value assets.\u00a0 Energy companies consider reserves of fossil fuels as assets.[30]<\/a>\u00a0 But, in light of current political and social action regarding climate change, many believe that energy companies will not be able to utilize all fossil fuel reserves that are now considered assets of the companies.[31]<\/a><\/p>\n

III. The Carbon Bubble<\/h2>\n

Prior to the Paris agreement, nearly 200 countries signed the Cancun Agreement, which embodied an international commitment to keep the global temperature from rising more than two degrees Celsius from pre-industrial levels.[32]<\/a>\u00a0 The Cancun Agreement additionally acknowledges the possible need to further restrict global warming to 1.5 degrees Celsius.[33]<\/a>\u00a0 In November 2011, Carbon Tracker Initiative (CTI), a nonprofit think tank, used the Cancun Agreement as a reference point and pioneered the concept of \u201cthe Carbon Bubble.\u201d[34]<\/a>\u00a0\u00a0 Relying on the assertion that the world would limit carbon usage within the bounds of the Cancun Agreement, CTI calculated that the world\u2019s energy budget was about one-third of what energy companies had in reserves.[35]<\/a>\u00a0 The other two-thirds would be \u201cstranded assets.\u201d \u00a0CTI defined stranded assets as:<\/p>\n

Fossil fuel energy and generation resources which, at some time prior to the end of their economic life (as assumed at the investment decision point), are no longer able to earn an economic return (i.e. meet the company\u2019s internal rate of return), as a result of changes in the market and regulatory environment associated with the transition to a low-carbon economy.[36]<\/a><\/p>\n

CTI further calculated, that by 2011, the world had already used a third of its usable energy budget.[37]<\/a><\/p>\n

CTI also asserted that the carbon bubble could pose financial risks to investors.\u00a0 The report states that:<\/p>\n

The current system of market oversight and regulatory supervision is not adequate to send the required signals to shift capital towards a low carbon economy at the speed or scale required. The current short-term approach of the investment industry leaves asset owners exposed to a portfolio of assets whose value is likely to be seriously impaired.[38]<\/a><\/p>\n

CTI further criticized the energy industry for continuing to use invested money to explore for more fossil fuel reserves, despite the fact that the reserves already located would exceed the carbon budget.<\/p>\n

IV. The Other Bubbles: Housing and Dotcom<\/h2>\n

To understand the possible effects of a carbon bubble, it is useful to look at the two most recent economic bubbles: the dotcom and housing bubbles.\u00a0 The dotcom bubble occurred from 1995-2001 and revolved around the growing tech industry catalyzed by the advent of the internet.[39]<\/a>\u00a0 The housing bubble began to grow in 2000 and burst in 2006 after banks and other originators approved more and more subprime and nonprime mortgages.[40]<\/a>\u00a0 The distinguishing factor between the housing bubble and the dotcom bubble is the was the impact on the economy.\u00a0 The housing bubble had a heavy impact on the economy, while the dot com bubble did not.[41]<\/a><\/p>\n

In the 1990s, the internet became increasingly integrated into everyday life.\u00a0 In response to growing dependence on the internet, many online retail companies began springing up.[42]<\/a> Investors enthusiastically invested in companies that were taking advantage of the internet frontier.[43]<\/a> Investor enthusiasm was so high, some companies saw stock prices double within one day of an IPO.[44]<\/a>\u00a0 The flow of investments fueled the \u201cdotcom bubble.\u201d[45]<\/a><\/p>\n

The intense investor enthusiasm made stock prices rise[46]<\/a> however, some companies were losing as much as $10 million to $30 million per quarter.[47]<\/a>\u00a0 Due to these unsustainable losses, many internet-based companies folded.[48]<\/a>\u00a0 Between March and April of 2000, roughly a trillion dollars worth of investments were lost.[49]<\/a><\/p>\n

Just as the dotcom bubble popped, the housing bubble began to grow.[50]<\/a>\u00a0 In the early 2000s, banks and other originators approved more subprime and nonprime loans.[51]<\/a>\u00a0 These mortgages were high risk because approved borrowers often had low credit scores or were charged rates and fees higher than they were unqualified for.[52]<\/a> Some mortgage loans had risks layered, including those where potential repayment issues were deferred by permitting \u201cadjustable\u201d payments.[53]<\/a> Such structures allowed borrowers to select monthly payments that were lower than the fully amortized rate.[54]<\/a> This meant that borrowers could make no principal payments and just send in a fraction of the interest accruing each month, for the first few years. With this type of adjustable rate mortgage, the principal balance would grow.[55]<\/a> The rates would reset in a few years to the fully amortized rates, and then monthly payments would spike to a level that many borrowers could not afford. After banks and other originators approved subprime mortgages, banks would pool these mortgages and use them to back securities that they would then sell to investors, including other banks.[56]<\/a>\u00a0 Certain slices of these mortgage-backed securities were sometimes repackaged into new pools that also issued securities.[57]<\/a> This scheme worked to help supply needed credit to the housing market while borrowers could afford their payments. However, when payments spiked and many borrowers defaulted, the mortgage-backed securities began to decline in value. Some banking firms that held mortgage-linked securities in their portfolios began to collapse.[58]<\/a><\/p>\n

The burst of both the dotcom and housing bubbles caused a loss of roughly $6 trillion in household wealth.[59]<\/a>\u00a0 While both bubbles caused similar losses, the housing bubble burst had a much greater effect on the rest of the economy than the dotcom bubble did.[60]<\/a>\u00a0 The housing bubble had a stronger effect on the economy because of the population impacted.[61]<\/a>\u00a0 When the dotcom bubble burst, the majority of investors were wealthy and less indebted.[62]<\/a>\u00a0 Even though those investors lost money, they still had disposable income.\u00a0 In contrast, the people who felt the shock of the housing bubble were mostly low-income homeowners.[63]<\/a>\u00a0 The bubble was fueled by subprime and nonprime loans that many people could not afford to repay.\u00a0 As a result, most of these people\u2019s income went into trying to pay their mortgages and save their homes.[64]<\/a>\u00a0 Unlike the wealthy, albeit unlucky, investors who lost wealth in the dotcom bubble, the homeowners impacted by the housing bubble could not afford to continue retail spending.[65]<\/a>\u00a0 Consequently, the economy felt a much greater shock from the housing bubble burst than the previous dotcom bubble burst.<\/p>\n

V. The Carbon Bubble Mirrors the Dotcom Bubble on a Financial Scale<\/h2>\n

It is unlikely that the carbon bubble will have the same detrimental effect on the economy that the housing bubble had.\u00a0 This is because the carbon bubble differs from the housing bubble in two significant ways.\u00a0 First, the carbon bubble is not fueled by debt, subprime or otherwise.\u00a0 Second, the carbon bubble is more similar to the dotcom bubble because the people who will most likely feel the shock are wealthy investors who will be able to absorb the loss without halting retail spending.<\/p>\n

In the housing crisis, the assets that were overvalued were the mortgage-backed securities.\u00a0 Borrowers could not repay high-risk loans, so there was no capital to fund the mortgage-back securities.\u00a0 On the other hand, there are still high consumption rates of fossil fuels.[66]<\/a>\u00a0 Whereas the housing bubble was built on unsustainable loans, the carbon bubble is forming around anticipated legislation.\u00a0 The carbon bubble is not forming from industry\u2019s inability to provide reserves, rather anticipatory need for regulation.<\/p>\n

Another factor that fueled the housing bubble was government intervention.\u00a0 The government promoted home ownership, leading more people to borrow money.[67]<\/a>\u00a0 In contrast, governments are not promoting fossil fuel usage. The recent election of Donald Trump to the Presidency may impact how \u201cstranded\u201d the energy company assets really are.\u00a0 During the Obama Administration, the United States made strides toward greener energy, which included signing the Paris Agreement.[68]<\/a>\u00a0 The President-Elect Donald Trump has pledged to withdraw from the Paris Agreement and has supported the use of fossil fuels.[69]<\/a>\u00a0 Therefore, the United States may not provide restrictive legislation that would burst the carbon bubble.\u00a0 Nevertheless, while a pro-fossil fuel administration in the United States may delay the shock, it will still come.\u00a0 The United States is only one of the countries that ratified the Paris Agreement.\u00a0 While fossil fuels may have a market in the United States under a Trump Administration, the global market will still decrease.<\/p>\n

The carbon bubble will most likely affect the economy similarly to the dotcom bubble.\u00a0 If the shares plummet, those affected will be mostly wealthy or institutional investors. For example, according to the Forbes Global 2000 list of the World\u2019s Biggest Public Companies, ExxonMobil ranked as number 9 and Chevron ranked number 28.[70]<\/a>\u00a0 The companies also ranked first and third respectively for public companies in oil and gas operations.[71]<\/a>\u00a0 Of the 4.15 billion outstanding ExxonMobil shares, company insiders own over 500 million and institutions own over 2 billion.[72]<\/a>\u00a0 Similarly, of the 1.89 billion outstanding Chevron stock, corporate insiders own approximately 75 million and institutional investors own more than 1.18 billion shares.[73]<\/a>\u00a0 While personal wealth would be lost if energy stock plummeted, it would not have the same detrimental effect on retail spending as the housing bubble did.<\/p>\n

Furthermore, stockholders are holding the companies accountable for their practices.\u00a0 Recently, ExxonMobil shareholders agreed to the \u201cprudent use of investor capital in light of the climate change related risks of stranded carbon assets.\u201d[74]<\/a>\u00a0 Also, some shareholders are bringing a securities class action alleging that ExxonMobil materially misrepresented its assets[75]<\/a> (although currently, the class is not yet certified[76]<\/a>). Shareholders can use these avenues to assist legislators in holding these companies to the carbon budget.<\/p>\n

VI. The Environment Will Still Suffer<\/h2>\n

While the carbon bubble is unlikely to wreak havoc on the economy, the threat to the environment is still very real. In fact, the lack of effect on the economy may increase the threat to the environment.\u00a0 If the world is committed to keeping global temperatures below two degrees Celsius, as of 2013, 60-80 percent of fossil fuel reserves must stay under the ground.[77]<\/a>\u00a0 The use of fossil fuels and the transition to renewables may not lead the world to a financial crisis, but if the transition is not quick, the world may face an environmental crisis.\u00a0 If energy companies are too slow in transitioning from fossil fuel to renewable sources, they will overspend on the carbon budget.\u00a0 If that happens, the likelihood of global temperatures exceeding the agreed on cap of two degrees Celsius increases. [78]<\/a>\u00a0 There are many effects that rising temperatures could have on the environment, including shrinking glaciers, loss of sea ice, accelerated sea level rise, longer and more intense heat waves, shifts in plant and animal ranges, trees flowering sooner, etc.[79]<\/a> Many of these effects are already documented.[80]<\/a><\/p>\n

If these changes continue, communities will feel the impact.\u00a0 The effects could be health-based, social, or cultural due to a change in the availability of natural resources.[81]<\/a> According to the Environmental Protection Agency,<\/p>\n

Climate change may especially impact people who live in areas that are vulnerable to coastal storms, drought, and sea level rise or people who live in poverty, older adults, and immigrant communities. Similarly, some types of professions and industries may face considerable challenges from climate change. Professions that are closely linked to weather and climate, such as outdoor tourism, commerce, and agriculture, will likely be especially affected.[82]<\/a><\/p>\n

While energy companies are inflating the carbon bubble by burning carbon and contributing to these environmental effects, it is unlikely that courts will hold companies liable.[83]<\/a>\u00a0 This is because, without a federal cause of action, it is challenging to prove causation.[84]<\/a>\u00a0 Since climate change is a global problem, it is challenging to prove that individual companies caused certain environmental issues.<\/p>\n

VII. Conclusion<\/h2>\n

There is reason to be concerned about the carbon bubble, but that reason is not the stock market.\u00a0 Most likely, the carbon bubble will not have the effect on the economy that the housing market did.\u00a0 This is because, on the financial side, either the companies will divest from fossil fuels or the people who will be affected by the carbon bubble burst will be wealthy enough to absorb the shock.<\/p>\n

On the other hand, if companies continue to burn carbon and inflate the carbon bubble, people will feel the environmental effects on a societal level.\u00a0 Natural resources may become scarcer, cultural ways of life may fade due to lack of resources and communities may be destroyed due to harsh storms.\u00a0 The impact on communities will not come from a stock market crash;\u00a0 it will come from environmental catastrophes.<\/p>\n

[1]<\/a> A Brief History of Coal Use<\/em>, U.S. Dep\u2019t of Energy, http:\/\/www.fe.doe.gov\/education\/energylessons\/coal\/coal_history.html (last visited Nov. 16, 2016).<\/p>\n

[2]<\/a> Eric McLamb, The Ecological Impact of the Industrial Revolution<\/em>, Ecology Glob. Network, (Sept. 18, 2011) http:\/\/www.ecology.com\/2011\/09\/18\/ecological-impact-industrial-revolution\/.<\/p>\n

[3]<\/a> Id.<\/em><\/p>\n

[4]<\/a> Id.<\/em><\/p>\n

[5]<\/a> Id.<\/em><\/p>\n

[6]<\/a> Id.<\/em><\/p>\n

[7]<\/a> Id.<\/em><\/p>\n

[8]<\/a> Id.<\/em><\/p>\n

[9]<\/a> Id.<\/em><\/p>\n

[10]<\/a> Id.<\/em><\/p>\n

[11]<\/a> Id.<\/em><\/p>\n

[12]<\/a> Lorraine Chow, 150 Days and Counting, Costa Rica Gets All its Electricity From Renewables, EcoWatch, (Sept. 7, 2016) http:\/\/www.ecowatch.com\/costa-rica-renewable-energy-1998953868.html; Justin Gillis, A Tricky Transition from Fossil Fuel: Denmark Aims for 100 Percent Renewable Energy<\/em>, NYTimes, (Nov. 10, 2014) http:\/\/www.nytimes.com\/2014\/11\/11\/science\/earth\/denmark-aims-for-100-percent-renewable-energy.html (discussing Denmark\u2019s commitment to wind energy); \u00a0<\/em>Justin Gillis, Sun and Wind Alter Global Landscape, Leaving Utilities Behind<\/em>, NYTimes, (Sept. 13, 2014) http:\/\/www.nytimes.com\/2014\/09\/14\/ science\/earth\/sun-and-wind-alter-german-landscape-leaving-utilities-behind.html (discussing Germany\u2019s commitment to renewable energy, the largest industrial power to do so.)<\/p>\n

[13]<\/a> Paris Agreement- Status of Ratification<\/em>, UNFCCC, http:\/\/unfccc.int\/paris_agreement\/items\/9444.php (last visited Nov. 21, 2016).<\/p>\n

[14]<\/a> The Paris Agreement, art. 2(1)(a), Nov. 4, 2016.<\/p>\n

[15]<\/a> See The World\u2019s Biggest Public Companies<\/em>, Forbes, http:\/\/www.forbes.com\/global2000\/list\/#tab:overall (last visited Nov. 21, 2016) (listing ExxonMobil, PetroChina, Chevron, Total, Sinopec, and Royal Dutch Shell in the top 50 public companies).<\/p>\n

[16]<\/a> Tara Schmidt, 2016: Time for Energy To Reinvent Itself?<\/em>, Forbes, (Dec. 15, 2015) http:\/\/www.forbes.com\/sites\/woodmackenzie\/2015\/12\/15\/2016-time-for-energy-to-reinvent-itself\/#1a2eaaef7386.<\/p>\n

[17]<\/a> Id.<\/em><\/p>\n

[18]<\/a> Id.<\/em><\/p>\n

[19]<\/a> Id.<\/em><\/p>\n

[20]<\/a> Carbon Bubble, Carbon Tracker Initiative, http:\/\/www.carbontracker.org\/report\/carbon-bubble\/ (last visited Nov. 11, 2016).<\/p>\n

[21]<\/a> Public Companies, <\/em>SEC https:\/\/www.investor.gov\/introduction-investing\/basics\/how-market-works\/public-companies (last visited Nov. 21, 2016).<\/p>\n

[22]<\/a> What We Do<\/em>, SEC http:\/\/www.sec.gov\/about\/whatwedo.shtml (last visited Nov. 21, 2016).<\/p>\n

[23]<\/a> Id.<\/em><\/p>\n

[24]<\/a> Id.<\/em><\/p>\n

[25]<\/a> Id.<\/em><\/p>\n

[26]<\/a> Jonathon D. Glater, Student Debt and the Siren Song of Systemic Risk<\/em>, 53 Harvard J. on Legislation 99, 121 (2016).<\/p>\n

[27]<\/a> Id.<\/em><\/p>\n

[28]<\/a> Id.<\/em><\/p>\n

[29]<\/a> Duncan Clark, Why Can\u2019t We Give Up Fossil Fuels<\/em>, The Guardian, (Apr. 17, 2013 12:49PM) https:\/\/www.theguardian.com\/environment\/2013\/apr\/17\/why-cant-we-give-up-fossil-fuels.<\/p>\n

[30]<\/a> Id.<\/em><\/p>\n

[31]<\/a> Id.<\/em><\/p>\n

[32]<\/a> Juliet Eilperin & William Booth, Cancun Agreements put 193 nations on track to deal with climate change<\/em>, The Washington Post(Dec. 11, 20100 http:\/\/www.washingtonpost.com\/wp-dyn\/content\/article\/2010\/12\/11\/AR2010121102308.html.<\/p>\n

[33]<\/a> The Cancun Agreement, art. 139(a)(iv).<\/p>\n

[34]<\/a> Carbon Bubble, Carbon Tracker Initiative, http:\/\/www.carbontracker.org\/report\/carbon-bubble\/ (last visited Nov. 11, 2016).<\/p>\n

[35]<\/a> Id.<\/em><\/p>\n

[36]<\/a> Key Terms<\/em>, Carbon Tracker Initiative, http:\/\/www.carbontracker.org\/resources\/ (last visited Nov. 21, 2016).<\/p>\n

[37]<\/a> Carbon Bubble, supra<\/em>, note 34.<\/p>\n

[38]<\/a> Unburnable Carbon, Carbon Tracker Initiative, 18 (2011).<\/p>\n

[39]<\/a> Ben Geier, What Did We Learn From the Dotcom Stock Bubble of 2000?<\/em>, Time, (Mar. 12, 2015). http:\/\/time.com\/3741681\/2000-dotcom-stock-bust\/.<\/p>\n

[40]<\/a> Jennifer Taub, Other\u2019s People Houses,\u00a0 140-145181-183<\/p>\n

[41]<\/a> Steven Gjerstad & Vernon L. Smith, From Bubble to Depression?<\/em>, The Wall Street Journal, (Apr. 9, 2009) http:\/\/www.wsj.com\/articles\/SB123897612802791281; Amir Sufi & Atif Mian, Why the Housing Bubble Tanked the Economy and the Tech Bubble Didn\u2019t<\/em>, FiveThirtyEight, (May 12, 2014) http:\/\/fivethirtyeight.com\/features\/why-the-housing-bubble-tanked-the-economy-and-the-tech-bubble-didnt\/.<\/p>\n

[42]<\/a> Geier, supra <\/em>note 38.<\/p>\n

[43]<\/a> Id.<\/em><\/p>\n

[44]<\/a> Id.<\/em><\/p>\n

[45]<\/a> Id.<\/em><\/p>\n

[46]<\/a> Id.<\/em><\/p>\n

[47]<\/a> Id.<\/em><\/p>\n

[48]<\/a> Id<\/em><\/p>\n

[49]<\/a> Id.<\/em><\/p>\n

[50]<\/a> Taub, supra <\/em>note 39, at 166.<\/p>\n

[51]<\/a> Id.<\/em><\/p>\n

[52]<\/a> Id.<\/em><\/p>\n

[53]<\/a> Id.<\/em><\/p>\n

[54]<\/a> Consumer Handbook on Adjustable Rate Mortgages, The Federal Reserve Board, 4, http:\/\/files.consumerfinance.gov\/f\/201204_CFPB_ARMs-brochure.pdf<\/p>\n

[55]<\/a> Id.<\/em><\/p>\n

[56]<\/a> Taub, supra<\/em> note 39, at 156.<\/p>\n

[57]<\/a> Id.<\/em> at 157.<\/p>\n

[58]<\/a> Id. <\/em>at 185.<\/p>\n

[59]<\/a> Amir Sufi & Atif Mian, supra <\/em>note 40.<\/p>\n

[60]<\/a> Id.<\/em><\/p>\n

[61]<\/a> Id.<\/em><\/p>\n

[62]<\/a> Id.<\/em><\/p>\n

[63]<\/a> Id.<\/em><\/p>\n

[64]<\/a> Id.<\/em><\/p>\n

[65]<\/a> Id.<\/em><\/p>\n

[66]<\/a>Fossil Fuels Still Dominate U.S. Energy Consumption Despite Recent Market Share Decline<\/em>, U.S. Energy Information Administration, https:\/\/www.eia.gov\/todayinenergy\/detail.php?id=26912 (last visited Dec. 10, 2016).<\/p>\n

[67]<\/a> Glater, supra <\/em>note 26, at 125.<\/p>\n

[68]<\/a> The United States Formally Enters the Paris Agreement<\/em>, The White House, (Sept. 3, 2016) https:\/\/www.whitehouse.gov\/blog\/2016\/09\/03\/president-obama-united-states-formally-enters-paris-agreement<\/p>\n

[69]<\/a> Here\u2019s How Soon Donald Trump Could Pull Out of a Historic Climate Change Deal<\/em>, Fortune, (Nov. 10, 2016) http:\/\/fortune.com\/2016\/11\/10\/donald-trump-climate-change-paris-agreement\/; Ashley Parker & Coral Davenport, Donald Trump\u2019s Energy Plan, More Fossil Fuels and Less Rules<\/em>, NYTimes, (May 26, 2016) http:\/\/www.nytimes.com\/2016\/05\/27\/us\/politics\/donald-trump-global-warming-energy-policy.html.<\/p>\n

[70]<\/a> The World\u2019s Biggest Public Companies<\/em>, Forbes, http:\/\/www.forbes.com\/global2000\/#\/industry:Oil%20&%20Gas%20Operations (last visited Nov. 27, 2016).<\/p>\n

[71]<\/a> PetroChina ranked second, however information on stock distribution was unavailable. Id.<\/em><\/p>\n

[72]<\/a> ExxonMobil Corporation<\/em>, Yahoo Finance, https:\/\/finance.yahoo.com\/quote\/XOM\/financials?p=XOM (last visited Nov. 27, 2016).<\/p>\n

[73]<\/a> Chevron Corporation<\/em>, Yahoo Finance, https:\/\/finance.yahoo.com\/quote\/CVX\/financials?p=CVX (last visited Nov. 27, 2016).<\/p>\n

[74]<\/a> XOM Return Capital to Shareholders to Avoid Stranded Assets<\/em> in 2016<\/em>, Ceres, https:\/\/www.ceres.org\/investor-network\/resolutions\/xom-return-capital-to-shareholders-to-avoid-stranded-assets-2016 (last visited Nov. 27, 2016). \u00a0<\/em><\/p>\n

[75]<\/a> ExxonMobil Corporation<\/em>, Rosen L. Firm, http:\/\/www.rosenlegal.com\/cases-988.html (last visited Nov. 27, 2016).<\/p>\n

[76]<\/a> Id.<\/em><\/p>\n

[77]<\/a> Unburnable Carbon 2013: Wasted Capital and Stranded Assets<\/em>, Carbon Tracker Initiative, (Apr. 2013) http:\/\/www.carbontracker.org\/report\/unburnable-carbon-wasted-capital-and-stranded-assets\/.<\/p>\n

[78]<\/a> Id.<\/em><\/p>\n

[79]<\/a> The Consequences of Climate Change, NASA, http:\/\/climate.nasa.gov\/effects\/<\/a> (last visited Nov. 27, 2016).<\/p>\n

[80]<\/a> Id.<\/em><\/p>\n

[81]<\/a> Climate Impacts on Society<\/em>, Envtl. Prot. Agency, https:\/\/www.epa.gov\/climate-impacts\/climate-impacts-society#equity<\/a> (last visited Nov. 27, 2016).<\/p>\n

[82]<\/a> Id.<\/em><\/p>\n

[83]<\/a> AEP v. Connecticut<\/em>, 564 U.S. 410 (2011)<\/p>\n

[84]<\/a> Id.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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