Hill Heat

At a Sandy anniversary panel organized by Forecast the Facts, climate and economic expert James Slezak says that investors should recognize that the fossil-fuel industry will go the way of the horse-and-buggy. Oil and coal companies, Dr. Slezak said, are “bad investments” that “don’t have the right capabilities or the right assets” to become renewable energy companies. Therefore, these companies should “liquidated” and their assets “wound up.”

One dangerous myth is that the BPs, the Exxons, the coal interests of the world are just energy companies and we just need to let them see why really, the future of energy is in renewables and they should be the renewable energy companies of the future. Don’t get me wrong, renewable energy is the future and needs to be quickly what replaces those companies. But I don’t think those companies are going to be the renewable energy companies of the future.

When you look at what these companies actually do, with a business hat on, and say I’m going to place a bet on the future on who’s going to win the race — Take solar for example. It’s a high-tech semiconductor industry. It’s not what dudes with hard hats on in the middle of the North Sea are good at, and it’s not where you would expect money to go.

We have to be a little bit harder on them. And make it clear why they’re such bad investments. They’re not going to win the race to develop solar. They don’t have the right capabilities, the right assets. They need to be wound up. They need to be liquidated. Their assets need to be wound up.

That sounds like a crazy, radical point of view, but you can look at multiple industries that the market just naturally wound up. The horse and buggy. New York’s streets were first lit with whale oil. True fact. Look it up. No one lamented those industries going. The typewriter industry wasn’t the industry that became the computer industry. These guys are going to go. The sooner the better, I think. And we don’t want to give them an escape route.

James Slezak (@jslez) is a social entrepreneur, author, and co-founder of Peers.org, a member-driven organization to support the sharing economy. He was previously a founding executive team member and partner at Purpose.com, and consultant at McKinsey & Company, where he led projects on sustainability, technology and economic development. He is co-author of the book Climate Change and Australia, as well as public reports on the economics of carbon emissions reduction released by McKinsey. James holds a PhD in Physics and was an affiliate at Harvard’s Berkman Center for Internet and Society.

The Forecast the Facts forum, “Turning the Tide: The Challenge And Promise Of Carbon Divestment for a Post-Sandy Wall Street,” took place on Sunday, October 29, at Cooper Union’s Rose Auditorium in New York City, with panelists from the Center for American Progress, Next Generation, and NYU Divest.