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17 April, 2023
Introduction:
On April 12, 2023, environmental organizations released the “Banking on Climate Chaos” report, which details the world’s largest banks’ spending on fossil fuel project financing since the Paris Agreement. The report reveals some shocking figures and highlights the urgent need to shift towards sustainable financing.
Highlights of the Report
- World’s 60 largest banks have spent a staggering $5.5 trillion or Rs 4,49,36,265 crore on financing fossil fuel projects since the Paris Agreement was signed in 2016. This figure alone demonstrates the scale of the issue at hand and highlights the need for swift action.
- United States was the top financier of fossil fuels, providing 28% of total financing in the fossil fuel sector in 2022.
- Ten banks that had the highest spending on fossil fuels from 2016-2022 include JPMorgan Chase & Co, Citibank NA, Wells Fargo & Company, Bank of America Corporation, and others.
- As much as $673 billion was spent on fossil fuel financing in just 2022, emphasizing the urgency of the situation.
- BNP Paribas, which lent the highest amount in Europe, is financed $20.8 billion worth of fossil fuel entities in 2022.
- Canada and Japan were the top financiers for fossil fuels from 2020-2022, revealing the need for these countries to take bold action to shift towards renewable energy sources.
- G7 countries provided $73 billion in public finance for fossil fuels from 2020-2022, which calls into question their commitment to the Paris Agreement.
- Danske Bank decided in 2023 to end fossil fuel refinancing of old oil and gas exploration and production projects and new long term financing for the same, especially for companies that lack a credible transition plan based on the Paris Agreement.