Last month, Bank of America published its 2014 Corporate Social Responsibility Report, which addressed the bank’s financing policies and practices in detail. This blog post looks back on the bank’s release of its updated coal policy in May, and looks at the strengths and weaknesses of the policy update and what it means for the banking sector’s financing of coal more broadly.
Bank of America’s new coal policy is both groundbreaking and imperfect. It acknowledges that the bank has a responsibility not only to finance the transition to low-carbon energy but also to cut financing for high-carbon energy sources. The policy goes well beyond comparable policies at the bank’s U.S. peers by committing to a broad cutback to BofA’s lending for coal mining both in the U.S. and internationally. However, this commitment lacks public-facing detail in terms of targets and deadlines, and fails to address the bank’s continued exposure to coal-fired power production. In spite of these flaws, Bank of America’s updated coal policy represents a clear step away from financing coal and a bold challenge to the bank’s peers in the months leading up to the Paris climate conference.
- Statement of responsibility for addressing the climate impacts of BofA’s financing – Bank of America’s updated coal policy states that the bank “has a responsibility to help mitigate climate change by leveraging our scale and resources to accelerate the transition from a high-carbon to a low-carbon society, and from high-carbon to low-carbon sources of energy.” This symbolic statement of responsibility is commendable, as it acknowledges that the bank considers addressing climate change to be an obligation and not just an optional initiative.
- Commitment to reduce financing for coal mining companies worldwide– The new policy commits the bank to “continue to reduce our credit exposure to coal extraction companies” and specifies that this commitment is global in scope. RAN will be monitoring Bank of America’s involvement with transactions with coal mining companies to verify that it is following through on this commitment.
- Specific commitment to cut financing for producers of mountaintop removal coal – In addition to making a global commitment to cut exposure to coal mining, the policy specifically states that the bank will be cutting its exposure to companies that engage in mountaintop removal coal mining. RAN will also be tracking the bank’s follow-through on reducing its exposure to coal companies with mountaintop removal mining operations.
- Additional environmental and human rights criteria for legacy coal mining transactions – The policy includes additional human rights, regulatory compliance, and environmental due diligence criteria to guide the bank’s assessment of any future transactions with its legacy coal portfolio.
- Lack of transparent deadlines and ambiguity about transaction types covered by the commitment – The policy does not include a clear timeline or deadlines for how the bank will proceed with its transition away from financing coal mining. Furthermore, the policy refers to the bank’s “credit exposure” and does not publicly specify how this commitment will apply to other corporate banking transactions other than loans, such as bond or equity issuance. However, RAN expects that BofA’s bond and equity underwriting exposure to coal producers will decline in tandem with its lending exposure to these companies, and we will be monitoring these transactions going forward.
- Continued support for coal-fired power generation – Although BofA’s policy is bold on coal mining, it does not address coal-fired power generation financing. The policy’s discussion of coal-fired power focuses on monitoring and reporting on emissions from the bank’s electric power financing portfolio, which falls well short of the urgent need to phase out not only coal mining but coal power generation as well. Moreover, the policy includes a worrying endorsement of carbon capture and storage technology, which, if widely-adopted, would further entrench coal-based power production.
- Need for a comprehensive approach to human rights and environmental due diligence – The bank’s disclosure of human rights, governance, and environmental due diligence commitments for its legacy coal finance portfolio is welcome. However, these issues are relevant not just to coal mining companies but to companies in other sectors as well. Therefore, Bank of America should disclose details of its human rights and environmental transaction screening processes for corporate clients in all high-risk sectors.
The Bottom Line:
With the window for avoiding the worst climate change emissions scenarios rapidly closing, 2015 will be a critical year for the climate. As the Paris climate summit approaches, the banking sector must act decisively to stop financing the production and burning of a fuel that is incompatible with a livable planet. Bank of America’s new coal policy is a major step in this direction. And with Crédit Agricole, Europe’s third largest bank adopting a similar policy later this spring, pressure is building on the rest of the industry to cut ties to coal. This summer and fall, RAN and over 75 other organizations are calling on global banks to meet and surpass Bank of America’s policy by committing to the Paris Pledge and ending financing for coal mining and coal-fired power production. The challenge to other U.S. banks is clear: It’s past time to stop financing coal.
Abbot Point coal export terminal would harm Great Barrier Reef, worsen global climate change
Photos from today’s petition delivery: http://bit.ly/1N2SjAu
Washington, D.C.—Activists from a coalition of environmental groups delivered over 670,000 petition signatures to the U.S. Export-Import Bank (Ex-Im Bank) today to call on the bank to publicly reject financing for the controversial Carmichael coal mining and export project in Australia. Activists rallied in front of Ex-Im Bank headquarters wearing blue clothing and clownfish hats and holding a coral reef-themed banner to demand that U.S. taxpayer dollars not be used to bankroll the project, which threatens Australia’s iconic Great Barrier Reef, as well as the global climate.
If built, the Carmichael coal mine, along with an associated export terminal at Abbot Point, would dramatically increase coal production and exports from Australia's Galilee Basin, one of the largest stores of coal on the planet. The plan for the new mine and port facility would make Australia the world's leading coal exporter, and lead to an estimated 705 million tons of carbon emissions annually. The project has faced fierce opposition, not only over its climate impact, but over the threats it poses to the Great Barrier Reef. Construction of the new export terminal at Abbot Point would require dredging part of the Great Barrier Reef World Heritage Area, in a plan that has prompted the United Nations Educational, Scientific and Cultural Organization (UNESCO) to consider placing the Great Barrier Reef World Heritage Site on its “in danger” list.
With the project receiving strong support from Australian Prime Minister Tony Abbott’s administration, campaigners have targeted investment banks to try and stop the project from gaining an estimated $16.5 billion in financing needed for the project to move forward. Eleven of the world’s leading private investment banks, including Citigroup, Morgan Stanley, Goldman Sachs, and JPMorgan Chase, have publicly ruled out providing financing to Indian conglomerate Adani Enterprises to build the project. But the U.S. Ex-Im Bank has thus far refused to take a position, amid reports that the bank may be considering a request for financing from Adani.
"If all the coal in the Galilee Basin is dug up and burned, it would have roughly the same carbon impact as burning all of the Alberta tar sands. In other words, we can't allow this project to move forward if we hope to keep climate change below 2C of warming," said Amanda Starbuck, Climate and Energy Program Director at Rainforest Action Network. "On top of that, construction of a new export facility at Abbot Point would require dredging part of the Great Barrier Reef World Heritage Area. Start to finish, this is a dirty, reprehensible plan that the Export-Import Bank should publicly reject. U.S. taxpayer dollars should not be used to bankroll Reef destruction and climate chaos."
“Already eleven major global banks, including the major lenders to Australian coal projects, have said no to this disaster of a project because they see that it ticks every risk box on the books,” said Charlie Wood, 350.org Australia campaigns director. “High levels of public concern about this project have already been demonstrated at the local, national, and international levels, with several million people having taken action to oppose them. This concern will only continue to grow. Ex-Im is placing its reputation on the line by refusing to take a position. They should rule out involvement now,” concluded Wood.
"It's clear that putting a price tag on one of the world's greatest natural treasures is simply not an option,” said John Coequyt, director of the Sierra Club’s International Climate Program. “Time and again, we've seen Big Coal dip its soot-covered fingers in the pockets of American taxpayers to finance dirty, dangerous projects. It's high time Ex-Im put an end to this wasteful cycle once and for all."
"It shouldn't take a PhD in ocean ecology for Ex-Im Bank to figure out it’s a bad idea to support another massive fossil fuel project inside one of the world's most important marine parks,” said Doug Norlen, senior manager of Friends of the Earth’s Economic Policy program. “It’s time for Ex-Im Bank to come clean and publicly declare they will not provide public subsidies to destroy a world heritage area.”
Regarding the U.S. Ex-Im Bank possibly helping to fund the Abbot Point coal port expansion in Australia, Ted Conwell of Climate First! strongly called for "the bank to disassociate itself from the project due to the massive negative effect it will have on global warming. If the coal port is expanded thereby allowing nearby coal mines to sell all their coal, the total CO2 emissions from the project could be three times the lifetime CO2 emissions created by the Keystone XL pipeline."
President Obama and Australian Prime Minister Tony Abbott have repeatedly clashed over coal, climate change, and the Great Barrier Reef. Abbott has called coal “good for humanity,” and has given strong backing to Abbot Point and other coal projects, while President Obama has publicly chided Australia for not doing more to address climate change or protect the Reef. Last month, after strong arm-twisting from the Australian government, UNESCO’s World Heritage Committee issued a draft decision not to designate the Great Barrier Reef as “in danger,” despite analysis from environmental groups showing the Reef has met as many as six out of the eight criteria needed to be added to the “in danger” list.
Claire Sandberg, Rainforest Action Network, 646-641-6431 firstname.lastname@example.org
Cindy Carr, Sierra Club, 202-495-3034, email@example.com
Jenny Bock, Friends of the Earth, 202-222-0754, firstname.lastname@example.org
Bank once labeled “Bank of Coal” announces broad commitment scaling down financial involvement in coal mining globally
Charlotte, NC—Bank of America unveiled a new global coal mining policy today committing to reduce exposure to coal mining companies across the board. Bank of America’s Andrew Plepler announced the new policy at the bank’s annual shareholder meeting this morning in Charlotte, stating, "With regard to coal, over the past several years we have been gradually and consistently reducing our credit exposure to companies focused on coal mining. Our new policy...reflects our decision to continue to reduce our credit exposure over time to the coal mining sector globally.” The policy change comes after four years of campaigning from Rainforest Action Network and other groups, and is the strongest policy of its kind to date.
“Today’s announcement from Bank of America truly represents a sea change: it acknowledges the responsibility that the financial sector bears for supporting and profiting from the fossil fuel industry and the climate chaos it has caused,” said Rainforest Action Network Climate and Energy Program Director Amanda Starbuck. “In real terms, this means the bank is turning its back on the coal mining industry and committing to energy efficiency and renewable energy.”
In light of the new coal policy, Bank of America received a BBB grade on coal mining from Rainforest Action Network, BankTrack, and the Sierra Club in the 2015 Coal Finance Report Card—the highest grade given to a bank to date in the report card. The 2015 report card, which was released Monday, cited the impending Bank of America policy change as a bright spot that other banks should emulate. The new Bank of America commitment states, “Bank of America will continue to reduce our credit exposure to coal extraction companies. This commitment applies globally, to companies focused on coal extraction and to divisions of diversified a mining companies that are focused on coal.”
“This is a challenge to other financial institutions,” said Starbuck. “We don’t need banks to change the lightbulbs at their corporate headquarters, we need them to stop bankrolling fossil fuels that are killing the climate.”
However, Bank of America received lower grades in coal-fired power and human rights, and Starbuck cautioned that Bank of America will have to live up to its commitments on coal-mining. “RAN will rigorously monitor the implementation of this policy and hold Bank of America to its word. We also hope other banks will go further than Bank of America went today. There are just a few short years left to prevent catastrophic damage from runaway climate change. We need to cut off the financial support for the coal industry—and we need to keep all fossil fuels in the ground.”
RAN announced its campaign targeting Bank of America in 2011, in light of the fact that Bank of America was considered the most resistant to changing its position on coal of all the major American investment banks. RAN, along with hundreds of allied groups, previously introduced shareholder resolutions at Bank of America annual meetings; worked with directly-impacted communities in the Powder River Basin, Appalachia, India, and Colombia to document environmental and human rights abuses related to Bank of America-backed coal mining companies; disrupted Bank of America recruitment efforts on campuses; organized direct action protests at Bank of America branch locations; and hung a “Bank of Coal” banner off the side of Bank of America stadium in Charlotte, NC, among many other tactics.
- To read the full Bank of America policy: http://bit.ly/1EXv0Ge
- 2015 Coal Finance Report Card, with grades for Bank of America: http://bit.ly/1cdZYzb
- Timeline of RAN’s campaign to push BofA, with photos and video: http://bit.ly/1FPrYEK
Sixth annual coal finance report card finds global banks pumped billions into coal finance in 2014, despite warning signs of coal's systemic decline
To download the full report, with 2014 bank grades: http://www.ran.org/coalreportcard
At a time when declarations about “the end of coal” abound, leading financial institutions have continued to put billions of dollars into coal mining and coal-fired power, despite dire warnings from climate scientists that we must end coal use immediately to avert catastrophic levels of global warming. Global banks collectively financed $141 billion for coal mining and coal power companies in 2014, according to the annual coal finance report card released today by Rainforest Action Network, BankTrack, and the Sierra Club. The findings in the 2015 report card indicate that, despite a dismal long-term financial outlook for the coal industry, banks have thus far been willing to prolong the demise of coal in the service of short-term profits—and at the expense of the global climate.
This year’s report card, titled “The End of Coal?”, does identify some bright spots in coal finance, with a critical mass of banks saying “no” to particularly destructive coal mining projects and practices, including proposed development of the Galilee Basin in Australia, and mountaintop removal mining in the United States. In addition, in 2014 key financial industry voices concluded that the shift away from fossil fuels has reached a turning point, with Goldman Sachs concluding that coal for power production has “reached its retirement age” and Bloomberg New Energy Finance marking the “beginning of the end" for fossil fuels. But despite these pronouncements, the end of coal will not come soon enough to limit climate change to internationally-agreed upon safe levels, unless banks act to drastically and rapidly end financing for coal.
“Many leading banks have acknowledged that financial institutions have a responsibility to usher in the transition from fossil fuels to renewable energy,” said Ben Collins, Senior Climate and Energy Campaigner at Rainforest Action Network. “Unfortunately, the same institutions that frequently tout their clean energy investments and LEED-certified headquarters are also keeping the coal industry on life support at time when climate scientists tell us we need to leave almost all coal in the ground, starting immediately, if we want to keep climate change to levels compatible with ongoing human civilization. We saw some signs of progress in 2014 with banks steering clear of some particularly egregious mining projects and practices, like Australia’s Galilee Basin and mountaintop removal mining in the U.S. Appalachian region. But unfortunately it’s not enough. We need banks to respond with leadership to the existential threat posed by climate change. Coal will die one way or another, but if banks wait to ditch coal until the market forces them to, the death of coal will come too late for the climate.”
Yann Louvel, BankTrack's climate and energy coordinator, said, “Looking at the slow evolution of bank policies related to the environmental and climate impacts of their coal financing, this year's report card is showing some positive signs of individual steps forward here and steps forward there. However, with time fast running out for proactive climate action to have any meaningful effect, the banks are basically fiddling with their policies while more and more coal burns as a result of entrenched levels of coal financing. It's outrageous for some banks to be hitching themselves to this year's UN climate negotiations in Paris as 'climate leaders' while they are not prepared to pull out of all coal sector financing, end of story. The banks' attention to the human rights considerations that are always involved in coal sector financing are patchy at best, and amount to little more than lip service to the UN human rights obligations that so many of them are signed up to. For as long as these banks continue to be coal industry supporters, they have to substantially beef up their human rights due diligence to protect communities in the industry's firing line around the world.”
Bruce Nilles, Senior Campaign Director, Beyond Coal at the Sierra Club said, "While there is demonstrated progress on the part of financial institutions, it's too little and too slow moving if we're to see any real impact on the climate disruption or public health. Banks need to better own their role and more actively harness their influence to transition off dirty energy sources."
Key findings from the 2015 report card:
• In spite of the financial distress faced by the coal industry overall, banks have approached financing decisions in a piecemeal fashion, with global financing for coal mining and top coal-fired power companies holding steady at $141 billion, compared to $145 billion in 2013.
• Disappointingly, major banks have also continued to finance several worst-of-the-worst “extreme coal” producers with major human and environmental impacts. Continued exposure to these coal mining companies shows that several banks continue to fail to meet basic human rights and environmental responsibilities.
• Global bank financing for coal mining, 2014: $66.37 billion (up from $55.28 billion in 2013)
• Global bank financing for the 30 largest coal-fired power producers, 2014: $74.39 billion, (down from $89.62 billion in 2013)
Claire Sandberg, Rainforest Action Network: +01-646-641-6431 email@example.com
Yann Louvel, BankTrack: +33 688 907 868, firstname.lastname@example.org
Ruby Shirazi, Sierra Club: +01 201 562 8560, email@example.com
MEDIA: Press release here. For inquiries, contact:
Claire Sandberg, Rainforest Action Network: +01-646-641-6431, firstname.lastname@example.org
Yann Louvel, BankTrack: +33 688 907 868, email@example.com
Ruby Shirazi, Sierra Club: +01 201 562 8560, firstname.lastname@example.org
There's a growing global recognition that it's time for banks to stop funding coal: it's financially risky and implicates them in serious environmental and human rights abuses. But the largest global investment banks continued to finance coal mining and power last year.
As the 2015 Coal Finance Report Card, The End of Coal?, published by Rainforest Action Network, BankTrack, and the Sierra Club, makes clear:
Even with the financial distress faced by the global coal industry in 2014, global financing for coal mining and top coal-fired power companies held steady at $141 billion, compared to $145 billion in 2013.
Disappointingly, major banks have also financed several worst-of-the-worst "extreme coal" producers with major human and environmental impacts. Continued exposure to these coal mining companies shows that several banks continue to fail to meet their basic human rights and environmental responsibilities.
On the positive side, in 2014, a critical mass of banks said "no" to particularly destructive coal mining projects and practices, including proposed development of the Galilee Basin in Australia, and mountaintop removal mining in the United States.
This year's report card rates the coal financing policies and practices of the largest global banks and highlights key case studies of global coal mining and power companies.
The banking industry must heed the warning signs of coal's systemic crisis, and take immediate steps to cut ties with the industry. If banks wait for the market to force them to transition away from coal, it will be too late for the climate.
Correction: Total coal mining financing figures for 2014 have been updated to $66.37 billion and bank coal mining financing rankings have changed due to a sector classification error involving a loan transaction on March 20, 2014 for WCL Finance Pty Ltd.
Barclays was the world’s top lender to mountaintop removal coal firms prior to announcing new policy
Barclays PLC, the number one bankroller of mountaintop removal (MTR) coal mining worldwide in 2013, has announced it is ending its financial support to the controversial practice. Barclays ruled out future financing for mountaintop removal projects and companies, citing MTR’s negative environmental and social impacts, as well as market forces. In its policy statement, Barclays also forecast that MTR will soon be “phased out” entirely, as a result of increased market and regulatory pressures. The Barclays announcement comes just weeks after U.S.-based PNC Financial announced its own policy restricting financing for MTR coal producers.
Full Barclays policy available here: http://bit.ly/1bRGcsM
Reacting to the news of the announcement, Rainforest Action Network Senior Climate and Energy Campaigner Ben Collins issued the following statement:
“It’s a big deal when the world’s number one bankroller of mountaintop removal announces it has rescinded its support to this destructive practice. We’re going to monitor Barclays’s future financing decisions very closely to see how this policy is implemented, but overall the announcement is a very good step in the right direction.
“It’s also a powerful affirmation of what we’ve been saying for years to see Barclays predict that mountaintop removal will be ‘phased out’ as a result of both market and regulatory pressure. That stark assessment points to just how toxic and risky this practice has become in the eyes of the financial industry. However, our work is not done yet; we won’t declare victory until mountaintop removal ends. Not only does mountaintop removal literally destroy entire mountains, but it leaves widespread devastation in its wake for communities across Appalachia.
“Following this news, we will continue to exert pressure on laggard banks that put their financial support behind a practice that has no place in a civilized society. Banks like Deutsche Bank and Goldman Sachs should take note of the decision by Barclays and adopt their own policies to end financing for mountaintop removal.”
Barclays was number one worldwide in financing for mountaintop removal coal producers in 2013, as documented in the 2014 Coal Finance Report Card,“Extreme Investments, Extreme Consequences,” released by Rainforest Action Network, the Sierra Club, and BankTrack. In 2013, Barclays financed $550 million in loan and bond transactions for mountaintop removal producers, acting as lead arranger in seven of these transactions.
RAN has campaigned to push numerous banks to stop financing mountaintop removal coal mining. JPMorgan Chase, Wells Fargo, BNP Paribas, UBS, RBS, Société Générale, and PNC Financial have all previously adopted policies restricting financing for MTR, under pressure from RAN and other groups. The 2015 Coal Finance Report Card will be released later this month.
For additional information on market trends in mountaintop removal finance, including summaries of various bank positions on MTR, please see the following background memo: http://a.ran.org/s1w
Claire Sandberg, (U.S.) 646-641-6431, email@example.com
The U.S. government’s Export-Import Bank wants to finance a huge coal project that would put Australia’s Great Barrier Reef at risk. We are calling on Fred Hochberg, Chair of the Export-Import Bank, to stop the destruction.
Click the links below to send a tweet and take action:
- .@fredhochberg, will @EximBankUS damage the #GreatBarrierReef by funding Abbot Point coal port expansion? #savethereef
- .@fredhochberg Hi Fred! Will @EximBankUS be financing Adani's coal export terminal in the Great Barrier Reef? #savethereef
Thanks to your pressure last year, many of the world’s largest banks have said “no” to financing a huge coal project that would put Australia’s Great Barrier Reef at risk. But the Reef is still in danger. As you know, news reports have revealed that the U.S. government’s Export-Import Bank is considering financing this destructive project.
Thousands have taken to social media, calling on Fred Hochberg, Chair of the Export-Import Bank, to stop the destruction. Click now to add your voice!
Funding the Abbot Point coal port expansion is a step in the wrong direction. The port expansion and the coal mines that would feed it would gravely damage the Great Barrier Reef and accelerate climate change. The resultant dredging and ship traffic would threaten one of the world’s most biodiverse ecosystems, a global treasure that is under protection as a World Heritage Site. Even Wall Street thinks the coal industry's plan to build a giant coal port in the middle of the reef is too toxic to fund. It’s ridiculous that a U.S. bank supported by taxpayer dollars would even consider funding such a destructive project.
We know that our pressure can help to stop the coal industry’s reef destruction. Thanks to your pressure, major banks have publicly committed not to fund this project, because it would be a disaster for the climate, the reef, and their bottom lines. Not only would this perpetuate climate chaos, the proposed Abbot Point expansion could threaten the breeding grounds of endangered green and loggerhead turtles.
In concert with our allies at the Sierra Club, Greenpeace, 350 and Friends of the Earth, we’ve been ramping up the pressure at the Export-Import Bank about this issue. We need to insure they are hearing loud and clear how dangerous investing in this project would be.
This is the perfect time for us to creatively change how we’re communicating with the bank, and we’ve discovered a great angle. Fred Hochberg, chair of the U.S. Export-Import Bank, is very active on twitter, tweeting nearly every day.
It’s time to amplify our message by tweeting at Fred Hochberg. Right now and through the week, send a tweet to @Fredhochberg about the proposed Abbot Point coal port expansion that the Export-Import Bank is considering financing.
The U.S. government’s Export-Import Bank isn’t used to having citizens weigh in on their decisions and Fred Hochberg isn’t used to having people communicate with him though his Twitter account. We have a great opportunity to impact his decision on whether or not to fund this destructive project. Let’s keep up the pressure so he knows we’ll be petitioning, calling and tweeting until this proposal is off the table.
1. "US Banks baulk at Abbot Point coal port expansion", The Australian, October 28, 2014
2. "Adani lines up $1 bln Indian state bank loan for Australian coal venture", Reuters, November 17, 2014
3. "Great Barrier Reef", United Nations Educational, Scientific and Cultural Organization
FOR IMMEDIATE RELEASE:
March 2, 2014
Today PNC Financial Services Group joined the growing ranks of financial institutions that have officially sanctioned the coal mining practice known as mountaintop removal (MTR.) Citing concerns about the environmental and health impacts of MTR, as well as financial risks, PNC pledged to no longer extend credit to individual MTR mining projects or to firms with 25 percent or more of their production coming from MTR.
Rainforest Action Network (RAN), which has for years worked to push the financial sector to disavow MTR, hailed the new PNC policy as a positive indication that MTR is increasingly seen as being unbankable. “PNC took a big step in the right direction today by acknowledging the serious health and environmental impacts of mountaintop removal, and by committing to reduce its exposure to this toxic practice. We’ll be scrutinizing PNC’s future financing decisions to see how this new policy is implemented,” said RAN Climate and Energy Program Director Amanda Starbuck. “Overall, we see today’s news as indicative of a broader trend within the financial sector. Banks no longer want to be associated with a dangerous, abhorrent practice like mountaintop removal; there is an emerging financial industry consensus that these practices are unacceptable. Concretely, this means mountaintop removal companies will have a harder time securing financing to operate and expand in the future.”
PNC’s new MTR policy, released today as part of the PNC Financial Services Group, Inc. 2015 Corporate Responsibility Report (available online here), reads as follows:
“Driven by environmental and health concerns, as well as our risk appetite, we introduced a mountaintop removal (MTR) financing policy in late 2010 and subsequently enhanced that policy in 2014. As a result, our MTR financing exposure has declined significantly and will continue to do so moving forward. Overall, PNC’s exposure to firms participating in MTR represents less than one-quarter of 1 percent of PNC’s total financing commitments. Under the policy, PNC will not extend credit to individual MTR mining projects or to coal producers with 25 percent or more of their production coming from MTR mining.”
In an introduction to the 2015 CSR report, PNC CEO William Demchak also wrote, “Our businesses implemented a number of important changes in 2014 to make environmental considerations a more prominent factor in PNC’s lending while still balancing those considerations with the economic needs of the communities we serve. As part of these efforts, we enhanced PNC’s mountaintop removal (MTR) financing policy. Due to environmental and health concerns, as well as our risk appetite, our MTR financing exposure has declined significantly over time, with current exposure to firms participating in MTR representing less than one-quarter of one percent of PNC’s total financing commitments, and it will continue to decline.
Citigroup’s new clean energy commitment fails to reduce fossil fuel exposure
In response to the announcement today of Citigroup’s five-year sustainability strategy and ten-year sustainability financing commitment, Rainforest Action Network (RAN) Climate and Energy Program Director Amanda Starbuck issued the following statement:
“The number one financier of coal power in the U.S. wants people to look the other way while it bankrolls climate chaos and destruction. Citigroup’s announcement of a new clean energy target today, absent a similarly ambitious commitment to reducing fossil fuel exposure, amounts to greenwashing, plain and simple. Citi was the number one lender and underwriter of coal-fired power in 2013, and the same year it also financed $434 million for mountaintop removal coal mining, which is poisoning communities in Appalachia. It’s misleading for Citi to leverage its green investments as a PR opportunity while shirking its responsibility to communities and to the climate. There’s no green energy on a dead planet.”
Citigroup announced a $100 billion clean energy target today as its ten-year sustainability financing commitment, but made no promises to reduce its exposure to fossil fuels, despite being the number one financier of coal-fired power in the United States, with a 23.6 percent market share and over $6.4 billion in lending and underwriting for coal power in 2013 alone, according to “Extreme Investments, Extreme Consequences,” the 2014 coal finance report card released by Rainforest Action Network, BankTrack, and the Sierra Club.
FOR IMMEDIATE RELEASE:
February 11, 2015
Australian diplomat lobbied U.S. banks to bankroll coal port that would turbocharge climate change and wreck the Great Barrier Reef
Documents released via open records request available here: http://a.ran.org/f1F
Rainforest Action Network (RAN) denounced the Australian government’s interventions on behalf of the coal industry, following the release of documents showing an Australian diplomat lobbied U.S. banks in support of the controversial Abbot Point coal export project in Queensland, Australia. Correspondence obtained through an open records request by Australian anti-coal group Market Forces show that Australian consul general Nick Minchin met with several U.S. banks in New York in November 2014 to try and shore up support for the proposed expansion of the Abbot Point coal port, shortly after Rainforest Action Network secured public commitments to steer clear of Abbot Point from U.S. banking giants Citigroup, JPMorgan Chase, Goldman Sachs, and Morgan Stanley.
Rainforest Action Network Climate and Energy Program Director Amanda Starbuck criticized the Australian government’s full-throated backing of Abbot Point. “It’s shameful that the Australian government would go out of its way to serve as a lobbyist for the financial interests of the coal industry,” said Starbuck. “This project, if completed, would be arguably the world’s single most destructive coal project. The proposed port expansion would unlock one of the largest stores of carbon on the planet, the Galilee Basin, which we simply must keep in the ground if we want to avert the most catastrophic impacts of climate change. On top of that, constructing the project would require dredging part of the Great Barrier Reef, one of the world’s irreplaceable natural treasures.”
The issue of coal’s impact on the Great Barrier Reef has been a matter of contention between President Obama and Australian Prime Minister Tony Abbott. Abbott has called coal “good for humanity,” and given strong backing to Abbot Point and other coal infrastructure projects, while President Obama has called on Australia to do more to protect the reef, and has spoken publicly about the threat climate change poses to the reef. UNESCO is currently considering whether to officially designate the Great Barrier Reef World Heritage Site as “in danger” due to the threat posed by Abbot Point.
The revelations of Australian government pressure on U.S. banks comes as RAN builds on the success of earlier campaigning to further marginalize Abbot Point from potential financial backers. In recent weeks, RAN has turned its attention to the U.S. Export-Import Bank (Ex-Im), following reports that the bank might be considering involvement in the deal. “U.S. tax dollars should be invested in climate solutions, not in throwing coal a financial lifeline and trashing a global treasure like the Great Barrier Reef,” said Starbuck. “Even Wall Street thinks the coal industry's plan to build a giant coal port in the middle of the reef is too toxic to fund. It’s time for the Export-Import Bank to follow suit.”
Ex-Im Chairman Fred Hochberg has not responded to RAN requests for the bank to clarify its stance on the project, beyond confirming that a formal application for financing has not yet been received. Last week, RAN members participated in a call-in day to the Export-Import Bank’s public hotline and urged the bank to stay away from Abbot Point.
The proposed expansion of Abbot Point is critical to the plan to open up coal reserves in the Galilee Basin. Nine new mega coal mines are currently slated for the area, five of which would be bigger than any coal mine currently operating in Australia, with an estimated 705 million tons of potential carbon emissions annually. If Galilee Basin coal is mined and shipped overseas through Abbot Point as planned, Australia would move from the number two to number one coal exporter in the world.