| Media Centre
Following the resounding victory for Angela Merkel's CDU party
in the September 22 federal elections, we expect a number of
announcements on environmental and energy reforms to follow in the
next few months. However, the choice of SPD or Greens as
coalition partner for the CDU is still unresolved and is likely to
be a major influence on future reforms.
Leaks from the UN's Fifth Assessment Report ("AR5") on climate
change ("CC"), which is due out on 27 September, have once again
stirred the hornets' nest and the airwaves are full of opinions
from CC "believers" and "deniers" alike. Although many
observers will be inclined to sit on the fence, decision makers who
employ scenario planning are actually well-placed to assimilate new
information in the report; in simple terms, scenarios in which
governments take additional action to reduce greenhouse gas
emissions should be assigned higher probability. In
particular, investors, whether they are natural "scenario planners"
or not, need to get up to speed with CC as an investment issue and
consider taking steps to manage related risks and exploit
Talking about climate change is fashionable again. In the
year when the concentration of carbon dioxide in the atmosphere
touched 400 parts per million for the first time in human history,
President Obama has elevated the topic in his in-tray, the Chinese
are experimenting with "cap and trade" and the Liberal Party in
Australia is threatening to roll back policy.
Jon Forster, co-manager of the Impax Specialists Strategy,
discusses successful small cap investing.
President Obama's decision to cast carbon pollution standards
for power plants as a logical extension of existing (and widely
popular) environmental regulations was brilliant political
theater. He stressed that all he was doing was calling on the
EPA to complete the pollution regulation it was already obliged to
do with regard to other toxic substances like mercury. And he
positioned the Federal government to be just following state
leadership on these topics, in classic "laboratories of democracy"
In the face of partisan priorities the Obama administration has
had significant unsung success in taking a more indirect approach
to tightening climate change policy, contrary to public perceptions
that this agenda has stalled.
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