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Just 7% of global banks' energy financing goes to renewables, new data shows
Major global banks are standing in the way of climate targets with new data showing just 7% of their financing for energy companies went to renewables between 2016 and 2022
The data, produced for Sierra Club, Fair Finance International, BankTrack and Rainforest Action Network, indicates major failings by financial institutions to help meet global commitments on net zero emissions by 2050 since it shows shockingly low financial support through loans and bond underwriting for clean energy. It calls into question pledges from the industry-led Glasgow Financial Alliance for Net Zero (GFANZ), whose commissioned research shows low carbon energy investments need to account for at least 80% of energy investments compared to fossil fuels (4:1) by 2030 to reach climate goals. However, no bank looks set to reach this very minimum requirement. Across the world, the picture is dismal: at US$ 181 billion Citi and JP Morgan Chase each pumped the most into the energy companies examined between 2016 and 2022 but just 2% went to renewables. Similarly, only 2% of Barclays’ financing of the energy companies examined went to renewables. Royal Bank of Canada is at just 1%, Mizuho 4% and HSBC 5%. The figure stands at 7% for French bank BNP Paribas. Bank loans and bond underwriting for renewables went from 7% in 2016 of the overall financing of the energy companies examined to a high of 10% in 2021 but virtually stagnated between these years, rather than showing any positive trend. The total amounts of clean energy financing in these years remained abysmally low: $23.2 billion in 2016 and US$ 34.5 billion in 2021. Overall the 60 banks saw US$ 2.5 trillion in loans and bond underwriting provided to the companies…