Annex 3: Stock value at risk from asset write-downs (Table 2) This analysis estimates the potential asset write- downs on key asset categories (upstream oil fields, coal plants, blast furnaces, heavy fuel vessels and steam crackers) expressed as a share of total 2030 stock value under slow, medium and rapid transition scenarios. Data sources: –Asset unitary CapEx and lifespan are derived from benchmarks of public and industry sources. –Lists of grey assets (including commissioning year and capacity, for current and announced assets) are sourced from industry databases (e.g. WFR for shipping, UCube for oil). Estimation methodology: –For upstream oil fields, coal plants and blast furnaces: –2030 demand for grey commodities is derived from IEA scenarios (Stated Policies, Announced Pledges, Net Zero Emissions by 2050). –Global 2030 capacity is estimated per grey asset class, accounting for current capacity, pipeline additions and projected retirements – highlighting a potential overcapacity vs. future demand under each scenario. –Total asset write-down value is calculated per asset class based on the residual book value of assets to decommission to meet demand under each scenario, assuming older assets are retired first and CapEx is depreciated linearly. –This value is then divided by the residual book value of total 2030 stock. –For heavy fuel vessels and steam crackers: –A theoretical “required decommissioning year” is estimated for grey assets, based on the date by which capacity for these assets is projected to fall below 10% of current capacity, under different IEA scenarios. –For each asset, lost useful value is estimated by calculating the difference between “required decommissioning year” and regular decommissioning year based on usual lifespan, assuming linear CapEx depreciation. –Total sector write-down is calculated by summing all asset-level lost useful values and dividing by total stock residual book value as of 2030. The Cost of Inaction: A CEO Guide to Navigating Climate Risk 52

The Cost of Inaction 2024