Banks continue to pour billions into climate change-causing fossil fuel financing, despite public pledges to tackle the climate emergency.
Big banks invest billions in fossil fuel projects
The annual Banking on Climate Chaos report follows the money and has revealed massive bank support for the world’s worst climate-destroying corporations.
The latest report lays bare the shocking fact that even as fossil fuel companies made $4 trillion in profits in 2022, banks still provided $673 billion in financing.
Remarkably, this happened while oil majors like Exxon Mobil and Shell PLC asked for $0 financing from banks in 2022.
In the seven years since the Paris Agreement was adopted to limit global warming, the world’s 60 largest private banks have financed fossil fuels with USD $5.5 trillion.
Royal Bank of Canada surpassed JPMorgan Chase as the leading financier of fossil fuels in 2022
For the first time since 2019, a Canadian bank is the #1 annual financier of fossil fuels.
Royal Bank of Canada (RBC) showered fossil fuel projects with $42.1 billion dollars in 2022, including $4.8 billion for tar sands and $7.4 billion into fracking.
Canadian banks are becoming the banks of last resort for fossil fuels, providing $862 billion to fossil fuel companies since the Paris Agreement. RBC continues to bankroll expansion projects like the Coastal GasLink fracked gas pipeline, which has been linked to human rights violations and has proceeded without consent from Wet’suwet’en Hereditary leadership.
Overall, U.S. banks still dominate fossil fuel financing, accounting for 28% of all fossil fuel financing in 2022. JPMorgan Chase remains the world’s worst funder of climate chaos since the Paris Agreement.
Citi, Wells Fargo, and Bank of America are still among the top 5 fossil financiers since 2016.
Fossil fuel companies double down on expansion amid calls for renewables
While Europeans and Ukrainians have called for a transition to renewables to stop funding Russian atrocities, fossil fuel companies have doubled down on expansion and weakened their climate commitments.
The top 30 companies expanding Liquid Natural Gas (LNG) used the crisis to secure nearly 50% more financing in 2022 compared to 2021 from the banks in the report — even as most energy experts agree that the LNG expansion plans in Europe are unnecessary, and new projects would contribute to a supply glut and long-term dependence on this fossil fuel.
Banks’ actions undermine Paris Agreement goals
49 of the 60 banks profiled in the report have made net zero commitments, but most are not paired with rigorous policies excluding finance for fossil fuel expansion.
The policies contain many loopholes that allow banks to continue financing fossil fuel clients.
Banks with restrictions on Arctic project financing, for example, nevertheless financed ConocoPhillips, which is developing the Willow project in the Arctic, the largest proposed oil project in the United States.
As the Intergovernmental Panel on Climate Change affirmed in its March 2023 report, to give humanity a chance at avoiding unacceptable harm to millions of people alive today and countless generations to come, fossil fuel expansion must stop, and use of fossil fuels across all sectors must decline sharply.
They assert that the window of opportunity to remain below 1.5˚C and to build a secure, liveable, and sustainable future is rapidly closing.
It’s clear that big banks and fossil fuel companies are not living up to their promises to address climate change.
Despite the urgent need to transition to renewable energy and halt the funding of fossil fuels, they continue to pour billions into these projects, further endangering our planet and our future.
It’s time for us to take action and hold these institutions accountable for their actions. We can do this by divesting from banks and financial institutions that fund fossil fuels, supporting renewable energy initiatives, and putting pressure on our governments to prioritise climate action.
Together, we can make a difference and create a more sustainable future for ourselves and generations to come.
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