Bank funding for renewables stagnates vs oil and gas – report

LONDON, Jan 24 (Reuters) – The share of financial institution finance going to renewable vitality slightly than fossil fuels has little modified in six years, elevating questions on how briskly lenders are pushing vitality purchasers to turn out to be greener, in keeping with analysis revealed Tuesday.

Since 2016 renewable vitality has taken 7% of a complete $2.5 trillion in financial institution loans and bond underwriting for vitality actions, in keeping with a report commissioned by environmental teams together with Sierra Membership and Truthful Finance Worldwide.

The overall annual sum banks have facilitated into renewable vitality rose to a excessive of $34.6 billion in 2021, from $23.2 billion in 2016, however the quantity going to fossil fuels elevated too, protecting renewables’ share broadly the identical.

Final 12 months the share of renewable vitality in funding 8% whereas in 2021 and 2020 it stood at 10% and seven% respectively.

“Banks’ financing to fossil fuels must be phasing out as financing to renewables will increase drastically to have any probability of reaching the world’s – and their very own – local weather objectives,” mentioned Ward Warmerdam, researcher at Profundo, which compiled the information.

Lenders say they have to finance fossil fuels given world vitality wants however that they’re serving to corporations transition to low-carbon future.

Renewable firms typically faucet non-public and authorities finance too, they add.

“This report doesn’t present a complete view of fresh vitality funding,” mentioned a spokesperson for The Glasgow Monetary Alliance for Internet Zero, a significant grouping of economic establishments

The spokesperson pointed to evaluation from the Worldwide Power Company which steered that between 2021 and 2022 round 48% of complete vitality funding went to low-carbon vitality provide.

JPMorgan, Citi and Barclays’ renewable vitality share was 2% between 2016 and 2022 and The Royal Financial institution of Canada’s 1%, the report mentioned. Citi declined to remark. JPMorgan, Barclays and RBC didn’t reply to requests for remark.

The analysis lined 60 of the world’s greatest lenders and 377 vitality corporations. It excluded biomass, nuclear and carbon seize and storage from its renewable vitality definition.

Reporting by Tommy Reggiori Wilkes
Enhancing by Tomasz Janowski

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