The world’s 25 largest banks are promoting climate change by feeding hundreds of billions of dollars into “extreme fossil fuels,” contradicting global consensus on energy policy, according to a report released in San Francisco on Tuesday.
In its seventh annual installment, “Shorting the Climate: Fossil Fuel Finance Report Card 2016” was delivered by Rainforest Action Network (RAN), BankTrack, the Sierra Club, and Oil Change International. Findings show that in the past three years, 25 American, European, and Canadian banks have invested $42 billion into companies active in coal mining; $154 billion into the 20 largest coal-fired power producers; $306 billion into companies drilling for extreme oil; and $282 billion into companies building liquefied natural gas export infrastructure.
“In finance terms, ‘short-selling’ or ‘shorting’ is when an investor profits if a company or asset declines in value. It means betting on failure,” Jason Opeña Disterhoft, senior campaigner with the Rainforest Action Network said in a statement. “After the Paris agreement, financing extreme fossil fuels amounts to shorting the climate. These bets are also at the expense of some of the most vulnerable communities living in fossil fuel ‘sacrifice zones’ around the world. We need banks to move now to help pivot the economy away from extreme fossil fuels for the sake of the planet and its people.”
The statement concludes that if governments follow the Paris Agreement, and limit carbon emissions, these investments could mean “stranded assets and significant losses.”
“Many banks announced a move away from coal in the run up to COP21 and after, but most of these focused only on coal mining,” BankTrack climate and energy coordinator Yann Louvel said in the statement. “Our assessment clearly shows that they still have a long way to go to concretely exit this industry, and even more for the other extreme fossil fuel sectors. None of these banks can claim to support the Paris Agreement, to be aligned with a 2° scenario or to be fighting climate change – as we too often read in their sustainability reports – if they continue to finance these destructive sectors.”
