Three of the nation’s leading banks – Citi, JPMorgan Chase and Morgan Stanley – released a set of principles yesterday that could affect lending to coal-fired power plants. The so-called “Carbon Principles” reflect the tremendous pressure felt by members of the financial industry for their investments in coal and other greenhouse gas-intensive industries.
According to Rainforest Action Network (RAN), which is calling on banks to end all coal investments, the Carbon Principles are an important step toward recognizing the climate risks associated with financing coal plants but are limited by their lack of any binding commitments and their failure to address the impact of destructive coal extraction methods such as mountaintop removal mining.
“The proof is in the pollution,” said Rebecca Tarbotton, Director of RAN’s Global Finance Campaign. “If this policy prevents the financing of new coal, it will be productive.”
The principles, which call for greater due diligence by banks and utilities in assessing the climate and economic risks associated with the construction of new coal plants, are a sign that growing public support for a moratorium on coal development is finally influencing bank policy. However, the principles would not require banks to set firm reduction targets for their investments in the coal sector.
“Calling them the ‘Carbon Principles’ is an overstatement,” said Tarbotton. “A serious climate change policy would commit the banks to emissions reductions in their financing and extend beyond coal into other carbon-intensive sectors such as coal mining and the oil and transportation industries.”
RAN, which in the past successfully challenged several of the world’s largest banks – including Citi, Bank of America, JPMorgan Chase and others – to adopt project lending policies that help safeguard the environment and human rights, is currently pushing banks to stop funding coal and other carbon-intensive sectors that contribute heavily to climate change. RAN has called on banks to set meaningful reduction targets for their financed investments.
Since January 2007, RAN and its allies have organized more than 60 public protests at Citi bank branches across the country and thousands of online actions to pressure the financial giant to stop funding coal.
For more on RAN’s Global Finance Campaign, visit www.dirtymoney.org