Fossil fuel development, in particular oil and gas, promised vast riches in the past. Today it is exposing fossil fuel producers and their creditors to a massive stranded asset risk. Technological disruption with the rapid cost-reduction of renewable energy and storage technologies, in conjunction with the inevitability of increased climate action, are at the root of unprecedented uncertainties over the future of the sector.
This paper outlines some viable options for creating an architecture for a Debt-for-Climate Initiative (DCI). This is intended to enable countries to recover from the pandemic.