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Banks and coal
From concerns over air pollution and acid rain to its destructive impact on the climate, coal has long been recognised as the dirtiest, most polluting fossil fuel and historically the leading cause of climate change. Globally, the biggest source of carbon dioxide is burning of coal - greater than burning oil or gas, or carbon dioxide emissions caused by deforestation.
These facts have been well established for some time, which has led to coal being the most heavily opposed of all fossil fuels, whether by Indigenous populations, civil society organisations, the general public or the scientific community. Due to this opposition, worldwide emissions from burning coal have been leveling off over the last decade, while emissions from oil and gas continued to rise. However, the trend in emissions from burning coal shows a clear geographical distribution: coal is on the decline in the OECD and EU countries, while it's still on the rise in many parts of Africa, Asia and South America. At the same time, coal mining operations and coal power plants are facing more and more financial difficulties due to the plunging cost of renewable energy and cheap natural gas.
Coal's fast decline
In some parts of the world, like the US and EU, coal has already started its inevitable decline. However, the pace at which coal is declining is nowhere near the pace of decline which is required to stay within the 1.5 degrees target of the Paris Climate Agreement. In order to meet the 1.5 degrees goal, global carbon dioxide emissions must be more than halved from 2010 levels by 2030 and reach ‘net zero’ by 2050. This gives a 50% chance of staying below a 1.5 degrees temperature increase by 2100.
However, coal emissions need to fall about twice as fast as those for oil and gas in the 2020s, which means that global coal emissions should decline by about 80% from 14.5 gigatons CO2 in 2019 to 3.1 gigatons CO2 in 2030. Most developed regions in the world, like the EU, OECD countries and Russia, therefore need to exit coal at the latest by 2030, with the rest of the world following by 2040 at the latest. This means that no new coal mining, coal power or coal infrastructure can be built, and a significant part of the coal industry needs to close before the end of its planned operational lifetime.
Therefore, financing of new coal projects and the companies behind them is incompatible with the temperature goals set in the Paris Climate Agreement. Banks must end support for all new coal activities and implement a full phase-out for financing coal projects and companies in line with the 2030-2040 deadline.
Despite an increase in the number of banks that have restricted or ended their financing for the coal sector, too many banks continue to finance the dirtiest of fossil fuels, making it increasingly hard to avoid climate breakdown. 60 of the biggest banks in the world have financed coal mining and coal power at the tune of USD 332 billion since the Paris Climate Agreement (2016-2020). The three biggest coal financiers in the world are Bank of China (USD 35 billion), ICBC (USD 29 billion) and China Construction Bank (USD 28 billion).
See here for banks' exposure to fossil fuel expanders in 2016-2020.
At the bottom of this page you can find the campaign pages of up-to-date assessments of bank policies in the Banking on Climate Change report on coal mining, coal power and coal infrastructure.
Bank policy scores on coal (overall score)
The table below shows banks’ aggregate policy score on coal. The 'details' section in the table provides further detail on the exact scoring per bank for coal mining, coal power, and coal infrastructure.
Bank policy scores on coal financing
Total: 6.5 points out of 80
1 point out of 32 for coal mining policy: see here.
5.5 points out of 32 for coal power policy: see here.
Total: 15 points out of 80
6.5 points out of 32 for coal mining policy: see here.
8.5 points out of 32 for coal power policy: see here.
For both coal mining and coal power, 32 possible policy points can be obtained, while for other coal,16 possible policy points can be obtained. So a bank can obtain a total of 80 policy points for its coal policies. Based on this score banks are then classified as laggards, followers, front runners or leaders.
Coal Policy Tool
Our work partners at Reclaim Finance have developed this Coal Policy Tool to analyse the quality of coal policies of banks and other financial institutions, providing further detail on strengths and weaknesses of specific policies.
Our policy assessments are always a work in progress and we very much welcome any feedback, especially from banks included in them. You can of course also contact us for more information on specific scores and the latest policy changes. Please get in touch at email@example.com.
Bondholders challenged JICA to stop supporting coal projects in Bangladesh and Indonesia
Ahead of shareholder vote, activists stage global actions urging Japanese megabank MUFG to end climate-destructive financing
Loopholes remain in SMBC Group’s new coal policy
UK banks’ support for coal industry has risen since 2015 Paris climate pact
The City of London, home of coal finance
NGOs call on 39 JICA bond underwriters and bondholders to urge JICA to stop supporting coal projects in Bangladesh and Indonesia
Banking on Climate Chaos 2021: World’s 60 largest banks have poured USD 3.8 trillion into fossil fuels since Paris Agreement
Citigroup first US bank to exclude companies expanding coal power
Shareholder campaign secures HSBC coal phase-out
Groundbreaking research reveals the financiers of the coal industry
Investors should reconsider financing Dutch RWE’s biomass and coal plants because of climate impacts, say environmental groups
Scandinavian banks poured $67 billion into the fossil fuel industry since Paris
Bowing to public pressure, Rizal becomes first bank in Philippines to exit coal
Industrial and Commercial Bank of China withdraws financing from the Lamu Coal Plant
NGOs release the 2020 Global Coal Exit List
ANZ commits to exit thermal coal, but rewards climate-destructive companies
Société Générale releases a misleading coal phase out policy
Japan’s 2nd largest bank – Mizuho – announces strictest ESG policies to date in Japan
Standard Bank’s coal policy fails to provide meaningful leadership on the climate crisis
Banks warned that deficient fossil fuel policies are accelerating climate crisis
Big four UK banks providing billions for coal power expansion, urged to ‘clean up their acts’ for Glasgow COP
Coal finance exit in France – Banks and insurers urged to drop coal expansion clients and make good on commitments
Japan seeks climate leadership at G-20 summit but can’t kick its coal habit
European utilities at risk from Credit Agricole’s new 2030 coal exit stance
Rothschild & Co bank called on to end support for Adani’s massive new coal mine
Santander’s deep support for fossil fuel industry challenged at bank’s AGM
UBS quietly improves its coal exclusion policy – a bit too weak, a bit too late
RWE plans destruction of ancient German forest
Banking on Climate Change – Fossil Fuel Finance Report Card 2019
Banks be warned – Poland’s PGE wants to blow the house and the climate on coal expansion extravaganza
Every two weeks a bank, insurer or lender announces new coal restrictions
Financial institutions’ tightening coal policies pressure utilities to change
COP24: New research reveals the banks and investors financing the expansion of the global coal plant fleet
New report: Three years after the Paris climate summit, French banks are financing more coal
HSBC accused of hypocrisy for coal finance ban that excludes countries most vulnerable to climate change
Over 670,000 MW of new coal threatens 1.5°C climate target
RWE financiers urged to join DekaBank call to stop destruction of Hambach forest
New report reveals Japanese financial institutions’ substantial role in climate crisis
New coal report finds troubling loopholes in existing bank policies
HSBC and Standard Chartered accused of “rank hypocrisy” for financing of highly polluting coal projects whilst publicly supporting Paris Climate Agreement
Sumitomo Mitsui Trust Bank announces end of new coal power project financing
Local NGOs push Singapore banks on coal: Stop using our money to fuel climate change
Standard Chartered wants to fund dirty coal-fired power stations in Vietnam
IEEFA report: Poland’s biggest utility is risking financial instability by doubling down on coal-fired generation
Environmental NGOs respond to statement by Sumitomo Mitsui Financial Group CEO on restricting coal-fired power financing
Fossil fuel protest by Greenpeace
Nedbank is moving on coal power, but two plants are stuck on its radar
Under Trump Administration, Big Banks Are Investing More Money Into Coal
Out of sync with climate reality – the coal mine and coal plant dreams of Poland's two dirty utilities
Investing in a Green Belt and Road? Assessing the Implementation of China’s Green Credit Guidelines Abroad
AXA Sets Milestone for Fossil Fuel Divestment
Banks and investors jeopardising the Paris climate goals
It's time for impact divesting: the Global Coal Exit List for the finance industry is launched
Japanese Banks ill-Equipped to Reform Banking Practices in Line with the Paris Agreement
Report Shines a Light on Hidden Backers of World’s Most Destructive Coal Project
Operation Car Wash and a coal plant in the Dominican Republic – anti-corruption protestors are not giving up
BankTrack has signed the Lofoten Declaration
Punta Catalina – the coal plant project that keeps on giving … a headache to European banks
More black marks for coal-hungry UK banks in latest Report Card
New database reveals world’s biggest coal plant developers
Campaigners to call for Deutsche Bank exit from Dominican coal plant at annual meeting
- Massive bribery allegations against plant construction company Odebrecht