Contact: Laurel Sutherlin, Rainforest Action Network, (415) 246-0161 email@example.com
Margaret Rossoff, No Coal in Oakland, (510) 459-6054 firstname.lastname@example.org
Oakland, CA — Today, Sumitomo Mitsui Financial Group (SMBC Group) announced that it will “in principle” not finance any new coal power projects, with some exceptions.(1) In response, advocates for environmental justice and public health in Oakland, California, called on the bank to drop its plans to finance a widely opposed coal export terminal planned in Oakland, which would supply millions of tons of coal for overseas coal power plants.
SMBC, Japan’s third-largest bank, has been involved in discussions with Insight Terminal Solutions (ITS), over financing of the highly controversial marine terminal in Oakland, California, U.S. that would be used to ship four million metric tons of coal annually from Utah to plants operated by Japanese energy giant JERA. Burning this coal would result in over 8 million tons of CO2 emissions/year.(2) According to a sworn declaration filed in a Kentucky, U.S., bankruptcy court by John J. Siegel, Jr., the CEO of ITS, JERA’s banker “SMBC discussed providing the full construction financing of approximately $240 million USD to build the Terminal.” (3)
No Coal in Oakland, a grassroots group that has opposed the coal terminal for five years, pressured the Bank of Montreal to abandon the project and is strongly opposed to SMBC’s involvement.
“Dust from storing and handling coal at the terminal would increase the adverse health impacts in a community that already has high rates of asthma as well as deaths from cancer, heart disease, and stroke. We in Oakland will fight any attempt to build a coal terminal here,” said Ann Harvey of No Coal in Oakland.
In July 2013, the City of Oakland signed a development agreement for a multi-commodity terminal on the Oakland waterfront, later known as Oakland Bulk and Oversized Terminal (OBOT). After learning that the developers were planning to use OBOT to transport coal overseas, the Oakland City Council unanimously enacted a city-wide ban on the storage and handling of coal. This ban is the subject of a federal lawsuit that is currently on appeal. Construction is stalled pending this decision and other legal and regulatory processes.
The terminal faces firm opposition across Oakland. The Oakland City Council, Oakland Mayor Libby Schaaf, thousands of city residents, and numerous local labor unions, faith leaders, health professionals and community organizations are all publicly opposed to the storage and handling of coal in Oakland. Any decision to finance the terminal would pose significant financial and reputational risks for SMBC.
“SMBC’s financing of a new coal export terminal in Oakland would be grossly hypocritical given its recent pledge to get out of coal power in principle. It would also betray SMBC’s endorsement of the UN Principles for Responsible Banking. From financing coal to fracked gas terminals, tar sands pipelines and even rainforest destruction, SMBC’s portfolio is overrun with climate-related risks,” said Hana Heineken of Rainforest Action Network.
SMBC poured more than $59 billion into fossil fuels in the years following the Paris Climate Agreement. SMBC’s financing of new coal plants around the world, particularly in Indonesia, Japan, and Vietnam, is opposed by a global coalition of climate activists and affected communities. (4)
“Recognizing that coal is a bad investment is a step in the right direction, but if the bank is serious about this commitment, then it should pull support for all new coal projects including the Oakland coal export terminal,” said Ben Cushing, Campaign Representative for Sierra Club’s Beyond Dirty Fuels campaign.
“SMBC should live up to its commitment to ‘contribute to a sustainable society.’ That means not financing the Oakland coal export terminal and ending financing for all fossil fuels on a Paris-compliant timeline,” said Susanne Wong of Oil Change International.
Notes to Editors:
- On April 16, SMBC Group announced significant updates to their financing policies, including adoption of a policy to stop financing all new coal-fired power plants in principle. However, the policy allows for exceptions, including plants that are ultra-supercritical or committed to before May 1 2020. The new policy also applies the Equator Principles to coal mining and excludes mountaintop removal. Details on the policy can be found here: https://www.smbc.co.jp/news_e/e600579_01.html
- Calculations are based on an EPA endorsed formula. Transporting coal to Oakland by diesel locomotive would result in an additional 1 million tons of CO2 emissions/year (Source: Siting energy facilities at Glasgow Air Force Base, Volume 3), and shipping the coal to Japan would result in further emissions.
- A copy of the relevant sections in the bankruptcy proceeding document, as well as additional background information on the terminal project, is included in the Appendix, found as a PDF here. A copy of the full bankruptcy document is available upon request.
- For more information on SMBC’s risky financing, see https://www.endcoalsmbc.com/