As the urgency of responding to climate change and the insufficiency of current demand-side policies to mitigate greenhouse gas emissions become clearer, supply-side initiatives are beginning to gain prominence and acceptance globally. Policies such as moratoria and compensation for leaving fossil fuels unextracted in exchange for financial compensation of rights owners are likely to be effective and complementary to existing policies. A number of unknowns remain regarding the operationalization of supply-side policies, such as how to establish a binding international agreement and how to raise and allocate financial compensation for nonextraction. Nevertheless, the need for supply-side policies only emphasizes the importance of imaginative and bold initiatives within the current conjuncture of global environmental politics.

To limit the increase in global mean temperature to 1.5°C, CO 2 emissions should be capped at 440 gigatons. To achieve this, about 89 percent, 59 percent, and 58 percent of existing coal and conventional gas and oil reserves, respectively, need to remain unburned. This implies an economic cost for fossil fuel rights owners, and any successful climate policy will rely on resolving the distributional challenge of how to allocate the right to use the remaining burnable reserves. We discuss the possibility of compensating rights holders of unburnable oil and gas reserves, producing the first estimates of the financial resources needed to secure full compensation. We estimate that approximately US$ 5,400 billion (10 9 ) would be needed. Despite the vast amounts required, compensation is nevertheless economically feasible. We suggest a Keynesian “whatever it takes” approach for climate action, combining partial compensation for unburnable fuels and investment in low-carbon technologies to drastically reduce emissions in the rapidly closing window of opportunity before 2030.