Financial Stress Test

Undisclosed Mining Client

Undisclosed Mining Client is a diversified base metals mining company primarily producing copper, nickel and zinc. When this project was completed, Undisclosed Mining Client had operations around the world. Ostrom Climate conducted a financial stress test to evaluate the financial risks associated with climate change including new and increasing carbon taxes, escalating energy costs and fuel surcharges, and uncertainty regarding future regulatory requirements to address climate change.

Our Involvement

Ostrom Climate evaluated the financial implications of various regulatory scenarios such as low, moderate, or high carbon taxes and fuel surcharges in each region where the client operates. We projected the client’s emissions out to the year 2040 and accounted for reductions resulting from the client’s proposed strategies as well as additional approaches recommended by Ostrom Climate. Total emissions and costs associated with energy usage and GHGs were calculated for each mine site.

Outcome​

The financial stress test was used to support the business case for enhancing energy efficiency and GHG reduction programs. It illustrated the financial and environmental benefits of climate change mitigation, and highlighted strategies that could be implemented to reduce the company’s financial exposure to climate change.


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