British banks still channelling billions of pounds into fossil fuel expansion

British banks continue to pour tens of billions of pounds into fossil fuel expansion, despite claims from the Chancellor Rishi Sunak at COP26 about making the UK ‘the world’s first net zero financial centre’.

Related topics:  Finance News
Rozi Jones
30th March 2022
climate change net zero campaigner
"The fact that UK banks continued to pour tens of billions of pounds into fossil fuels in the same year we hosted COP26 shows just how unserious our financial sector is about the climate crisis."

These are the findings in a new report, titled ‘Banking on Climate Chaos’, published by a coalition of civil society groups today.

Five UK lenders - Barclays, HSBC, Standard Chartered, Lloyds and Natwest - channelled more than £35bn of new money into fossil fuels in 2021, with Barclays remaining the biggest financier of dirty energy in Europe. The figures suggest that these five lenders have poured more than £275bn into fossil fuels since 2016.

This is in spite of the fact that such banks are members of the Net Zero Banking Alliance: a member alliance of the Glasgow Financial Alliance for Net Zero (GFANZ). GFANZ was the crowning jewel of Rishi Sunak’s COP26 announcements, with 450 global finance firms committed to alignment with the 2015 Paris Agreement, including limiting global warming to 1.5C.

Fran Boait, executive director at research and campaign group Positive Money, said: “In the fossil financier leaderboards, British banks once again stand out for all the wrong reasons, making a mockery of the Chancellor’s promise to make London a net zero financial centre. The fact that UK banks continued to pour tens of billions of pounds into fossil fuels in the same year we hosted COP26 shows just how unserious our financial sector is about the climate crisis.

“The International Energy Agency has called for no new investments in fossil fuel expansions if the world is to reach net zero by 2050. Relying on disclosures and voluntary, non-binding commitments simply isn’t enough to shift finance at the pace needed to keep 1.5C alive - we need strong regulation to stop banks fuelling our reliance on fossil fuels.

“The government will set out a major Green Finance Strategy this year, which will be a golden opportunity to turn words into action by concretely shifting financial flows out of fossil fuels and into the cheap renewables that will secure our energy independence and bring down household bills.”

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