With just 21 days left until the start of the Paris Climate Summit (COP21), there is still time for banks to make a strong commitment to do their part in stopping climate change; by publicly pledging before ‘Paris’ to stop financing the coal industry.
Banks that make this ‘Paris Pledge’ to abandon coal will help ensure that ‘Paris’ will indeed be the watershed event we need it to be in the global fight to combat climate change. After all, while the negotiations in Paris will focus solely on reaching emission reduction targets, the tailpipe approach, the real challenge is at the wellhead; how do we keep at least 80 percent of all currently known fossil fuel reserves in the ground, starting with coal?
Banks publicly committing to no longer finance the coal industry are a crucial step towards achieving the goal of keeping coal in the ground. If their current massive support to the coal industry would dry up tomorrow, the industry will no doubt come to a crashing halt. It makes a lot of business sense too: coal has no place in any future sustainable energy scenario so smart banks better leave the sector now, or risk losing billions in stranded assets later on as a result of falling demand and tightening regulation.
This is why over the last weeks BankTrack sent hundreds of letters to banks the world over, asking them to respond to the call of over 160 civil society organizations and 10,000+ individuals and make the Paris Pledge. Until now, eleven banks responded favorably and publicly committed to stay away from coal, with a number of other banks still contemplating and likely to follow. Congrats to those banks that made the Pledge!
Paris Pledge aside, in the last few months we also saw some good moves of other banks on the coal finance front; in what seems to be a trend in the making global players like Credit Agricole, Bank of America, Citi and Natixis have now all said goodbye to sizeable chunks of their coal mining business. No doubt helped by some vigorous campaigning, banks also show themselves increasingly reluctant to finance climate killer projects as the Rampal and Plomin coal power plants, or the vast Alpha coal mining project in Australia.
What is still missing however in the run up to Paris is an announcement by a large bank, currently still financing the coal industry, that is has decided to go ‘coal clean’ and sever its ties with the coal industry. One can’t help wondering why a bank that has already concluded that the future of coal is in the past does not grab the phenomenal opportunity to give its green credentials a boost and announce an end to its financing of coal right before Paris. Rather than seeking to green themselves with dubious sponsorships of the COP21, as BNP Paribas did, or by issuing feeble climate statements as Dutch banks did, or by announcing absolutely nothing at all despite claiming to be a leading sustainability initiative, such as the Equator Principles, such a bold move from a large bank to quit coal would impress us all.
21 days to go before Paris. Banks, what are you waiting for?