IEA warns of Paris blow to high-carbon investments

Singapore

ENERGY investors should look beyond short-term profit maximisation to consider the implications of the Paris climate change agreement on their portfolio in the long term. High-carbon investments are likely to face greater pressure, warned International Energy Agency (IEA) executive director Fatih Birol, though he added that this will not be an overnight change as much depends on how domestic energy policies are changed to follow the global accord that was reached last week. Speaking to reporters on the sidelines of an IEA outlook briefing in Singapore, Dr Birol said: "Paris says to investors in general that if you invest in high-carbon infrastructure, you may well have implications for that."

This is especially so for those putting money into inefficient coal power plants, which account for 90 per cent of all coal power plants in Asia, he added. "There may be (changes in) domestic policies by some governments in terms of setting regulations, and those regulations may range from local pollution issues to climate change issues which can put some restrictions on the subcritical coal-fired plants."