Major banks around the world are still funding fossil fuel companies for trillions of dollars.
A new report, published Wednesday by a collection of climate organizations and entitled Banking on Climate Chaos 2021, finds that 60 of the world’s largest commercial and investment banks collectively put $ 3.8 trillion into fossil fuels between 2016 and 2020, the five following the Agreement signed from Paris.
“This report serves as a reality check for banks that think vague ‘net-zero’ targets are enough to stop the climate crisis,” said Lorne Stockman, a Senior Research Analyst at Oil Change International, one of the organizations that drafted the report. . in a statement released with the report. “Our future is going where the money flows, and by 2020 these banks will have plowed billions to lock us in further climate chaos.”
Year-on-year, total fossil fuel funding fell 9% in 2020, but the report attributes that to Covid-19-related demand constraints.
The report also found that “fossil fuel financing … by the world’s 60 largest commercial and investment banks was higher in 2020 than in 2016,” the first full year of the Paris climate agreement. It is worth noting that President Donald Trump withdrew from the international agreement in 2017. President Joe Biden re-joined the Paris Agreement on his first day.
The three banks that financed the most fossil fuels in 2020 were for $ 51.3 billion, according to the JPMorgan Chase report; Citi for $ 48.4 Billion; and Bank of America with $ 42.1 billion.
A JPMorgan Chase representative told CNBC Make It that the bank was unable to comment on a third-party report. But the bank did refer CNBC Make It to its initiatives to address climate change, including “making a financing commitment aligned with the goals of the Paris Agreement” and facilitating $ 200 billion in clean, sustainable finance. by 2025.
Citi sent CNBC Make It to a blog post published Tuesday by Val Smith, the bank’s Chief Sustainability Officer. In the post, Citi said it will work with existing fossil-fuel bank customers to move first to a public reporting of greenhouse gas emissions and then to phase out the funding offered to companies that do not meet the standards for carbon reduction.
“As the world’s most global bank, we recognize that we are connected to many carbon-intensive industries that have driven global economic development for decades,” Smith wrote. “Our work to achieve net zero emissions by 2050 therefore requires us to work with our customers, including our fossil fuel customers, to help them and the energy systems we all rely on in the transition to a net zero economy. “
Bank of America did not immediately respond to CNBC Make It’s’s request for comment.
The Banking on Climate Chaos 2021 report comes as indicators show that global economies are currently not on track to meet the emission reductions set as part of the Paris Agreement in 2015.
The 2020 report is the 12th annual, although the scope of the report has expanded in that time. The report was a collaboration of seven non-profit organizations: Rainforest Action Network, Bank Track, Indigenous Environmental Network, Oil Change International, Reclaim Finance, and Sierra Club.
The report’s authors collect data on bank loans and underwriting data using the Bloomberg credit methodology, which means that credit is split between banks that play a leading role in a particular transaction, and that data from Bloomberg Finance LP and the Global Coal Exit List can be used.
Banks will also be given the opportunity to weigh in on the findings. “The findings of the draft report will be shared with banks in advance, and they will have the opportunity to comment on funding and policy evaluations,” the report said.
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