Geographical tailoring of transition impacts – what assumptions does the organization make about potential differences in input parameters across regions, countries, asset locations, and markets? Macro-economic Variables – what GDP rate, employ-ment rate, and other economic variables are used?ĭemographic variables – what assumptions are made about population growth and/or migration?Įfficiency – to what extent are positive aspects of efficiency gains/clean energy transition/physical changes incorporated into scenarios and business planning? Price of key commodities/products – what conclusions does the organization draw, based on the input parameters/ assumptions, about the development over time of market prices for key inputs, energy (e.g. coal/ oil/ gas/ nuclear/renewables (sub-categories)? How does this develop over time assuming supply/end-use efficiency improvements? What factors are used for energy conversion efficiencies of each source category and for end-use efficiency in each category over time? the organization’s other key stakeholders.ĭiscount rate – what discount rate does the organization apply to discount future value?Ĭarbon price – what assumptions are made about how carbon price(s) would develop over time (within tax and/or emissions trading frameworks), geographic scope of implementation, whether the carbon price would apply only at the margin or as a base cost, whether it is applied to specific economic sectors or across the whole economy and in what regions? Is a common carbon price used (at multiple points in time?) or differentiated prices? Assumptions about scope and modality of a CO2 price via tax or trading scheme?Įnergy demand and mix – what would be the resulting total energy demand and energy mix across different sources of primary energy e.g.the structure and dynamics of the organization’s supply and demand markets.the organization’s assets and nature of operations.the geographic location of the organization’s value chain (both upstream and downstream).Business impacts may also vary significantly depending on the following:.The business impacts related to climate change may vary significantly depending on the industry and economic sector(s)/sub-sector(s) in which an organization operates.Each organization faces a different blend of climate-related risks and opportunities.An organization needs to understand the nature of the climate-related risks and opportunities it may face. Appendix 1 provides a more in-depth discussion of the IEA and IPCC scenarios.Ģ.This would need to be taken into account if a more disruptive scenario were to be developed.
#Define finance mix strategy full#
However, both have inherent sets of assumptions and biases on the future path of development, which does not span the full spectrum possible future pathways. Producing these scenarios requires estimates of future population levels, economic activity, the structure of governance, social values, and patterns of technological change and hence can serve as “meta-scenarios” to provide an overall context and set of macro trends for the development of company or sector-specific scenarios.The scenarios developed by the International Energy Agency (IEA) and Intergovernmental Panel on Climate Change (IPCC) have long been used by scientists and policy analysts to assess future vulnerability to climate change.An organization may want to familiarize itself with relevant scenarios that are already developed. Considerations for building climate change into scenario analysisġ.
0 kommentar(er)
