RIEF論文：Carbon Liability ~ Considering global carbon balance sheet（Yoshihiro Fujii. Sophia University）
By the term ‘Carbon Liability’ we mean a calculation of values approximating to the economic externalities of carbon emissions in the global economy, in relation to the totality of global economic activity.
As a consequences of over two centuries of industrialization, the global carbon budget and its associated global carbon balance sheet have clearly diverged from a state of natural equilibrium. Deterioration of carbon budget has affected on asset value of energy intensive companies which have huge fossil fuel reserves, called as stranded assets.Three material identifiable, types of carbon risks, ‘Cap-and-trade’ schemes are important economic mechanism aiding both the rectification of these imbalances and restoration of natural carbon cycle disrupted by emissions of anthropogenic greenhouse gas (GHG) in both developed and emerging countries. Such schemes establish an economic value to carbon through open market trading.They serve to quantify and to reduce carbon risk, in accordance with appropriate and efficient economic regulation. Monetizing carbon liabilities through these market mechanisms is a means to place boundaries on, and thus to mitigate, the uncertainties of carbon liability. This process of monetization may also transform market risk into an opportunity for economic exploitation.