Despite slashing lending to the coal industry, Australia’s big banks are still financing fossil fuels on a significant scale, a new report reveals.
The report, released by environmental finance group Market Forces, shows that the Big Four banks have lent $17 billion to the fossil fuels industry after giving public support to the Paris Climate Agreement in December 2015.
The Paris agreement carried a commitment to keep the world below 2 degrees of warming.
Participating countries signed up to a variety of renewable energy and sustainable initiatives.
Yet the projects financed by the Big Four banks – Commonwealth, ANZ, National and Westpac – contradict their former pledge, according to Market Forces.
The projects equate to adding 3.4 billion tonnes of CO2 to the atmosphere over their lifetimes, the finance group claims.
This is sufficient to negate the emissions savings from Australia’s 2030 target three times over.
Finance for coal is down
Yet it’s not all bad news for renewable energy, as the report indicates.
While the big banks are still investing in fossil fuels over renewable energy at a ratio of 3.5 to one, they’ve put the brakes on finance for new coal projects.
The report shows that overall finance for coal is declining steeply, reduced from $3.1 billion in 2015 to $1.4 billion in 2016.
In July 2017, the total figure stands at $458 million, a substantial reduction in coal spending.
Community backlash over coal’s environmental impact, married with structural decay within the industry, has contributed to this decline, the report notes.
Australia’s banks lag in renewable commitment
Australia’s Big Four banks are falling behind their global competitors in terms of renewable policies, Market Forces Executive Director Julian Vincent notes.
Avenues remain open for the banks to resume coal lending, he says.
Furthermore, Australian banks rank among the world’s worst in policies around fossil fuel development.
“Globally, investment into renewable energy more than doubled that into fossil fuels as early as 2015, yet Australia’s banks – and Commbank in particular – are operating as if it was the other way around,” Mr Vincent said.