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By: BankTrack

2019-12-19 11:35:14

Contact:

climate@banktrack.org

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The Tanjung Jati B coal power plant in Jepara, Central Java. . Photo: Kemal Jufri / Greenpeace

Banks: Quit Coal!

From concerns over air pollution and acid rain to its destructive impact on the climate, coal has been recognised as the dirtiest, most dated and most inefficient fossil fuel option. It is the most emissions intensive fossil fuel and the leading cause of climate change. Globally, coal-fired power plants are the largest source of carbon dioxide – greater than tropical deforestation or oil use for transportation.

These facts have been well-established for some time, yet it is only very recently that international private sector commercial banks, which have collectively provided the global coal industry with hundreds of billions of dollars in financial support over decades, have started to publicly sound alarm bells about both coal's terrible impacts and its increasing unsoundness as an investment commodity.

Such alarm bells are growing across the banking sector, in advice to investors published in recent years by banks such as UBS, Goldman Sachs, HSBC and Citi. This kind of recognition of the threat posed by continuing the extraction and burning of coal, albeit very belated, is welcome from the banking sector.

However, the latest lending figures revealed in the Fossil Fuel Finance Report Card 2019 indicate the challenge which remains to reduce the coal finance mountain. Since the Paris Agreement was signed and between 2016 and 2018, 33 of the biggest international banks provided:

$41.8 billion in financing for the 30 top coal mining companies.
$94.5 billion in financing for the 30 top coal power companies.

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The tenth edition of the Fossil Fuel Finance Report Card.

Photo: BankTrack et al

Coal campaign breakthroughs

There have been a number of significant coal finance breakthroughs in the last few years, in large part due to campaign pressure applied by BankTrack and our allies engaged in international coal campaigning.

As of October 2019, 45 major international banks have adopted or updated a policy restricting their financing for coal mining and coal power, with many and various different kinds of policies introduced – as you can see via BankTrack's coal policy tracking webpage.

Despite these advances, the world’s major banks still need to stop their ‘indirect financing’ to companies planning any new coal projects, as the window for taking action to drastically reduce carbon emissions and avoid climate change devastation is rapidly closing. Positively, the bar has been raised (in June 2019) by French bank Crédit Agricole when it commited to fully phase out of coal, including an immediate end to business with companies planning to develop new coal projects

However, as evidenced by persistent multi-billion dollar financing for coal mining and coal power, the banking sector is still dragging its heels and remains resistant to fully cut ties with coal.

At BankTrack we believe that in order to stop further devastating impacts resulting from their investments, the big banks must take steps to disengage from all activities and projects that substantially contribute to climate change and environmental and community degradation.

In the coal sector, therefore, they must:

End support for all new coal extraction and delivery, and all new coal-fired power plants projects, worldwide;
End support for all coal companies that meet one of the following criteria:

Companies which are planning investments into new coal mines, new coal power plants or coal infrastructure, or which are planning to buy existing coal mines, coal power plants or coal infrastructure.
Companies which generate more than 30% of revenues from coal mining or produce more than 30% of power from coal.
Companies whose annual production, consumption or trading of coal exceeds more than 20 million tons per year, or or which have over 10 gigawatts of coal power capacity.

BankTrack coal campaigns

In recent years, and in tandem with our partners, our coal campaigning around the world has focused on numerous dodgy deals. This has resulted in various coal finance victories:

Mountain Top Removal (MTR) Coal Mining in the United States

Our targeting of major key banks with long track records of supporting the devastating MTR sector has reaped positive dividends in the last few years. As a result of campaign momentum in 2014-2015, there are now – as of June 2017 – 19 major US and European banks which have publicly committed to pull out of this most controversial and catastrophic form of coal mining.

Coal mining in the Galilee basin in Australia, including these projects:

Alpha Coal Mine
Carmichael Coal Mine
Great Barrier Reef Coal & Gas Exports

The Galilee Basin is a 247,000 square kilometre thermal coal basin in the central region of the Australian state of Queensland. It is one of the largest untapped coal reserves on the planet. There are currently nine coal mega-mines proposed for the Galilee Basin, including Alpha Coal and Carmichael, which together make it the second biggest fossil fuel expansion proposed anywhere in the world (after Western China).

A global coalition of NGOs has been opposing these projects for years, and has targeted international banks involved or that could get involved in these dodgy deals, resulting in the withdrawal of Société Générale from the Alpha Coal project, the withdrawal of Commonwealth Bank and Standard Chartered from the Carmichael project, as well as commitments from 21 major banks not to get involved in the financing of the Abbot Point coal export terminal, the Carmichael project, any Galilee basin project, or in fact any new coal mine project globally.