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.
Often referred to as MTR, mountaintop removal is a horrendous practice that destroys mountains, poisons water supplies and hurts communities. That's why more than 19,000 Rainforest Action Members have sent messages to Barclays demanding the drop MTR financing and is one reason protests confronted the banks annual share holder meeting in London this week.
Barclays executives should take a good long look at these photos. Maybe then they'll stop investing in mountain destruction.
MTR uses explosives to literally blow off the tops of mountains and get the coal underneath.
Hundreds of thousands of acres of beautiful mountains and forest are being destroyed in central Appalachia by companies using MTR.
The rubble from mountaintop removal mining is then pushed into valleys where local streams and water sources are contaminated.
Hundreds of families have had their wells destroyed by nearby mining practices. Cancer, birth defects, heart and long disease and shortened life spans plague communities near MTR sites.
The difference between contaminated and clean water can be stark. It is time for Barclays to get on the right side of history and stop financing companies that poison water.
Photos by Paul Corbit Brown.
There is nothing quite like giving one of world's biggest banks a bad day. A bad week is even better.
Today, protestors swamped Barclays' annual shareholder meeting in London, calling out all sorts of nefarious deeds committed by the bank: speculating on food prices, supporting tax havens, ridiculous executive bonuses and its outrageous financing of the world's dirtiest fuel, coal.
Our friends at World Development Movement showed up as well-dressed eagles to spoof the bank's logo and call Barclays out for being the world's largest financier of mountaintop removal coal mining (MTR) in Appalachia.
Paul Corbit Brown, an Appalachian native and president of Keeper of the Mountains, drove the message home when he testified at today's Annual General Meeting about how MTR goes beyond just leveling mountains. It poisons communities and causes devastating health problems wherever it is practiced.
Since last Thursday, Rainforest Action Network members have sent more than 19,000 messages to Barclays and demanded the bank immediately start moving away from financing mountain destruction.
Our pressure appears to be working. World Development Movement reports that Barclays has agreed to meet with Paul for a further discussion of MTR.
Photo Credit: World Development Movement
Tomorrow, I’m visiting Barclays and I need you to back me up.
In 2013 Barclays gave $550 million in financial support, more than any other bank, to companies destroying my home of central Appalachia with mountaintop removal coal mining (MTR).
That's why I've traveled all the way to England to speak at Barclays' annual shareholder meeting. I want to ensure that the bank's leaders and shareholders know about the true scale of destruction caused by MTR.
MTR is destroying everything I love. More than just leveling mountains, it will pollute our water for countless generations. The health of all those around me is already suffering. Cancer, birth defects, lung disease, heart disease, and dramatically shortened life expectancies have sadly become normal in the communities where MTR is practiced.
The coal industry could not do its dirty work without the help of banks like Barclays. We need to make sure the bank and its shareholders hear that no corporation and no individual has the ethical right to profit from the destruction and sickness caused by MTR.
When people like us hold banks responsible for financing destruction, we can make a difference. We've already persuaded JPMorgan Chase, Wells Fargo and BNP Paribas to move away from MTR financing.
Barclays bank's executive team will be under tough scrutiny at their shareholder meeting. If we act in unison today, we can ensure that the message I'm going to deliver to the meeting packs a powerful punch—and demands responsible and ethical action from the bank.
Paul Corbit Brown is president of Keeper of the Mountains, a West Virginia-based foundation that aims to educate and inspire people to work for healthier, more sustainable mountain communities and an end to mountaintop removal. He is a photographer who has worked in more than a dozen countries and exhibited throughout the United States.
For the first time since we began publishing coal finance report cards five years ago, we have an encouraging trend to report: Major banks have begun making noise about the growing financial risk associated with climate change—and specifically associated with coal, the top global contributor to carbon pollution.
On top of that, major banks have begun to cut ties with the biggest mountaintop removal (MTR) coal companies. This progress has exposed a growing gap between banks that are still sinking billions into coal, and those that are cutting ties with the worst-of-the-worst in the coal industry.
Today, RAN, the Sierra Club, and BankTrack released our 2014 Coal Finance Report Card, “Extreme Investments, Extreme Consequences,” which grades U.S. banks on their performance and policies related to coal-fired power and mountaintop removal coal mining. We also uncovered the top financiers of contentious coal export schemes like those in the Pacific Northwest and coal trains that transport dusty coal across the United States.
All told, banks sank over $31 billion into the worst companies in the coal industry last year, with $6.5 billion coming from Citigroup, the top funder of coal-fired power. However, JPMorgan Chase and Wells Fargo began to phase out financing for MTR, earning our first ever “B” grades, and marking a positive trend away from the extreme mining practice.
Meanwhile, UK-based Barclays increased its exposure to MTR, financing $550 million for mountaintop removal coal companies last year, more than any other bank.
Environmental damage from mining, transporting, and burning coal—including health hazards like air pollution and water contamination from spills—doesn’t just harm communities and the environment, it costs banks money. In the report card, we highlight examples of this in case studies about the rising cost of clean-up for water contamination at mine sites, increases in coal company bankruptcies, and money-losing coal-fired power plants.
The report comes on the heels of analyst publications from Goldman Sachs, HSBC and Citigroup last year, each of which challenged the case for continued investment in the coal industry. These and other banks have acknowledged that power plant regulations, a potential price on carbon, and competition from renewable energy sources could “strand” assets such as coal mining, transport, and power generation facilities. With billions of dollars in loans on the line, it’s not a question of if climate risk will translate into financial risk, but when.
Ironically, these very same banks maintain deep financial ties to the riskiest and most environmentally destructive companies in the U.S. coal industry. As credit ratings for some coal mining companies sank farther below investment grade last year, banks continued to place bets on risky loans to the sector.
The report card warns banks that before the carbon bubble bursts onto their balance sheets, it will irreversibly destabilize the climate. So while we are happy to report that a few banks took the first steps to cut off financing to the worst-of-the-worst of the coal industry, the banking industry as a whole must now cut its losses and forge a path away from coal, before it’s too late for both them and us.
This post is by Yann Louvel, BankTrack Climate and Energy Campaign Coordinator.
Earlier this month, Bank of America participated in the 2014 Investor Summit on Climate Risk as the “convening sponsor” of the event. While there was a lot of talk about the urgency of the problem of tackling climate change, there were a few things the bank didn’t talk about. For starters, their role in financing the coal industry.
The 2014 Investor Summit on Climate Risk took place at the United Nations in New York on January 14th. Among the speakers was Lisa Carnoy, Head of Global Capital Markets for Bank of America Merrill Lynch, whose bio tells us that she “leads 700 Capital Markets professionals across Equity Capital Markets, Debt Capital Markets, Leveraged Finance and Origination of Corporate Derivatives and FX across the Americas, Europe, Asia and the Emerging Markets.”
If the bank’s finance for fossil fuels wasn’t mentioned at all, what do you think Carnoy did talk about in her speech? You may be pleased to hear that she conveyed the great imperative felt by the banking sector on climate change. Bank of America’s approach to the issue would be “like a hockey team: we’re fierce, we’re fast, and we feel the urgency.” What’s more, the banking sector as a whole was coming together to “put aside its natural competitiveness,” because “this is incredibly important, the time is now, and we need to work together.”
Great! So how had this fierce, fast hockey team come together to tackle climate change? The one initiative Carnoy presented was the Green Bonds Principles, a set of voluntary guidelines for how banks can develop and issue bonds to support green industries, which she implored investors to get behind.
While we support any efforts to scale up finance for genuine alternatives to fossil fuels, Bank of America’s backing for green bonds is dwarfed by the activities that Carnoy did not talk about. These are the activities that we have been exploring in our most recent reports: its finance for the coal sector. Bank of America was ranked the number three “climate killer bank” worldwide in the BankTrack network’s 2011 Bankrolling Climate Change report, which covered investments in 70 of the largest coal companies between 2005 and 2011. And in BankTrack’s more recent Banking on Coal report, Bank of America again ranked world number three, this time in its finance for coal mining, based on an analysis of finance for 70 coal mining companies worldwide.
Among the deals Carnoy did not talk about are some (not remotely green) bonds issued by her Capital Markets team over the last two years, which helped to raise over $1 billion for Alpha Natural Resources and Arch Coal. These companies are pure-play US coal miners, and are being targeted by campaigners for their involvement in destructive mountaintop removal coal mining in Appalachia. These bonds are toxic for our climate as well as for the investors who buy them, spreading climate risk through the financial markets in the form of potential future “stranded assets.”
While Bank of America is asking investors to back the Green Bonds Principles, it is investors who should be asking Bank of America to stop feeding them with these financially risky climate killer bonds. And now that Bank of America feels the “urgency” and “imperative” of tackling climate change, it would do well to stop financing climate change through issuing bonds for coal mining.
It is time for banks to come together, put aside their natural competitiveness, and agree to stop financing coal. Because this is incredibly important. The time is now.
Since last Thursday's toxic spill, when a coal-processing chemical spilled into West Virginia's Elk River, roughly 300,000 people have lost access to tap water. Our friends at groups like OVEC, Keepers of the Mountain, Coal River Mountain Watch and Aurora Lights are volunteering and working long days to drive clean water supplies to desparate and remote communities throughout the nine affected counties in West Virginia. A few dollars goes a long way to help. Click any of those links to donate. I just donated and want to urge you to consider making a donation to water relief efforts too. Yet again Appalachian communities are being disenfranchised. This industrial disaster is not getting much play in the national media, despite being just a few hours from the nation's capital. Meanwhile, West Virginia's Governor keeps insisting that this disaster has nothing to do with the coal industry. To be clear, the chemical that spilled (4-methylcyclohexane methanol) is a chemical that is produced for use producing coal (the "cheapest" form of energy in this country) and the reason that a relatively small spill was able to impact so many people's drinking water (16% of the state) is that decades of contamination from coal mining and processing means that many rural communities can no longer rely on well water, and instead have to connect the municipal water systems. Then the privatization of public infrastructure means that the business has been aggressively consolidated into even larger distribution networks. Combine all that with the regulatory joke that is West Virginia's "Department of Environmental Protection" (the site's last inspection was in 1991), and you have a disaster on your hands. Ken Ward (IMO the smartest journalist covering these issues) wrote this morning:
Plenty of West Virginia communities have watched their drinking water supplies be either polluted or dried up because of coal (see here, here and here). Me and my neighbors are getting a taste right now of what some coalfield residents live with all the time.
If you want to help spread awareness of this tragedy and the urgent need for support of the affected West Virginians, please share this post on Facebook.