Campaigners urge Santander to set ambitious timetable for fossil fuel exit ahead of AGM
One day before its online Annual General Meeting, a group of four environmental organisations has urged Banco Santander to strengthen its commitment to help fight the climate crisis, by committing to end its financing of the fossil fuel industry. The International Institute of Law and the Environment (IIDMA), BankTrack, Polish Foundation “RT-ON” and Ecologistas en Acción call upon the bank to publicly commit to an immediate end of its financing of all new oil and gas projects as it has already done for coal, and publish a comprehensive phaseout plan for its existing oil and gas portfolio.
Banco Santander, together with its Spanish counterpart BBVA, was recently listed among the 35 largest bank financiers of the fossil fuel industry, which over the period 2016-2019 provided nearly USD 2.7 trillion in support for this industry. The Banking on Climate Change - Fossil Fuel Finance Report 2020, prepared by Rainforest Action Network, BankTrack, Indigenous Environmental Network, Oil Change International, Reclaim Finance and Sierra Club and supported by more than 240 organisations worldwide, has found that since the signing of the 2015 Paris Climate Agreement, the two Spanish banks provided over USD 43 billion in support to the fossil fuel industry.
Banco Santander alone provided nearly USD 26 billion to the fossil fuel industry since the Paris agreement. From 2018 to 2019 it was even one of the European banks with the biggest percentage increase in fossil financing, raising its support from USD 5.1 billion to nearly USD 9 billion.
The Banking on Climate Change report further finds that Santander continues to invest in the tar sand industry, despite this being one of the dirtiest fossil fuels on the planet, with a carbon footprint 23% larger than that of conventional oil, while the mining practices required to extract it destroy a major carbon sink: the boreal forests. The report also finds USD 640 million of investments of Santander in oil and gas exploration in the Arctic, one of the world's most fragile ecosystems, and from 2016 to 2019 a near doubling of investments in Liquefied Natural Gas (LNG), a fuel source on the rise but whose life cycle involves significant methane leakage. Another piece of bad news for the climate, considering that methane is a gas with a high warming potential.
The report further highlights that Santander Bank Polska has granted loans to Polska Grupa Energetyczna (PGE), an electricity company whose generation is over 90% coal-based. PGE plans to expand its coal mine in Turów, in the southwest of the country, and build the Złoczew lignite mine, which will require a resettlement of 3,000 people.
The huge support from Santander allocated to these operations is not in line with the bank's narrative on climate change, as it has positioned itself as a major player in the financial sector in the fight against climate change on several occasions. During last year’s UN COP25 on Climate Change, Ana Botín - Chair of Banco Santander - said that "climate change is the greatest challenge the world faces and requires us all to make decisions" and that her bank "is one of the world's largest providers of green finance" and will increase "the actions to support every day the transition to a sustainable energy and production model.” This message does not correspond well with the fact that the Spanish bank maintains its links with the polluting fossil fuel sector worldwide.
The organisations now calling on the bank to change its course on financing the fossil fuel industry recognise that the attention of the world and the bank is currently focused on fighting the COVID-19 pandemic. Yet, the threat emanating from the accelerating climate crisis is not on hold while we deal with this pandemic. As forests disappear, glaciers and permafrost soils melt and entire populations are sent adrift, the climate crisis is even likely to contribute to further pandemics in the future.
Statements by organisations
Johan Frijns, Director of BankTrack states: “The climate crisis poses an immediate threat to the lives and wellbeing of people. By continuing to heavily finance the fossil fuel industry, Banco Santander contributes to the further acceleration of this crisis endangering people, ecosystems and the planet. We have seen Santander capable of taking immediate action in the face of a crisis, as shown by its measures to support the fight against COVID-19. We encourage the bank to use the same willpower to immediately end support for all new fossil fuel projects, and to draft a robust plan for phasing out support for all existing fossil fuel projects and companies on a timeline consistent with what is necessary to meet the Paris targets.”
"We know that the money flows from the financial sector are destroying biodiversity, exacerbating climate change, driving the anthropocene that leads humanity out of our safe operating space. If we continue on this path the human species is in danger. It is essential that banks like Santander become aware once and for all and act in accordance with their statements and commitments," warns Ana Barreira, director of the International Institute of Law and Environment (IIDMA).
Polish state-owned companies have been ignoring the need for urgent coal phase out for more than 10 years now. PGE, the biggest of them with more than 90% of electricity generated from coal burning, has finalised 1,8 Gigawatt of hard coal power plants in 2019. Even in 2020 it is still building a new lignite unit at Turów which pushes the company to prolong lignite extraction at a nearby mine until 2044. Banco Santander has been providing unconditioned support for PGE expansion ever since September 2015 and nothing signals any change on the horizon - explains Kuba Gogolewski, senior finance campaigner at Polish Foundation “RT-ON”.
"Green-washing campaigns are immoral in an era of climate crisis like the one we are living in, in which many people, species and ecosystems are being sentenced to death by climate inaction. Something is wrong when Banco Santander receives recognition for its supposed sustainability and at the same time integrates lists as one of the world's dirtiest banks. We need less money spent on greenwashing and more action truly aligned with the Paris Accord" said Samuel Martin-Sosa, head of International Ecologists in Action.