Financing in the lead up to Cop26 largest of all major UK banks finds campaigners taking to the streets.
According to a report by climate finance campaigners, in the months leading up to the Cop26 climate talks in Glasgow, Barclays has financed more in fossil fuel projects than any of the UK’s largest banks.
Despite growing international warnings that any new fossil developments would destroy any chance of avoiding a catastrophic climate breakdown, Market Forces found that from January 2021 to the eve of the UN climate summit, the bank had financed $5.6bn (£4.1bn) for new fossil fuel projects.
Barclays’ multibillion-pound support for fossil fuel projects was ranked ahead of that of HSBC, which financed $5.3bn this year, and Standard Chartered, which made $4.3bn available.
Barclays financed a $194m bond to the Canada-headquartered pipeline company Enbridge, which part-owns the controversial Dakota Access pipeline which is expected to carry enough crude oil to produce the emissions of 30 coal plants every year, the report found. Moreover, it said that the bank provided $200 million to MEG Energy, which extracts Canadian tar sands oil, one of the most polluting fuels on the planet.
Additionally, the report indicated how HSBC and Standard Chartered participated in a $6bn bond issuance to Saudi Aramco, the world’s biggest and most polluting company, and that HSBC financed a $1.5bn bond to Qatar Petroleum, which owns the world’s biggest gas field.
Despite committing to net-zero carbon emissions from financing activity by 2050 and issuing warnings that no new fossil fuel projects are compatible with keeping global heating in check, the three banks have extended financing to fossil fuel companies.
The report findings come before a series of Cop26 events scheduled for November 3 that is intended to mobilize public and private finance to help tackle the climate emergency.
Mia Watanabe, a campaigner at Market Forces, said:
“Despite their warm words, these banks continue to finance fossil fuel companies and projects that are destroying the world’s hopes of meeting climate targets.”
Market Forces, in a stunt to mark the latest report, held a Formula One-style “prize-giving” for the banks’ “race to disaster” outside Barclays’ Glasgow offices, which is a stone’s throw from the Cop26 venue.
In the five years after the signing of the Paris agreement, a previous annual report by the group that tracked global fossil fuel financing found that the three banks combined financed more than $257bn in the coal, oil, and gas sectors.
As per the report, Barclays was the world’s seventh-biggest fossil fuel funder, and the biggest in Europe, while HSBC was ranked 13th in the world. According to Market Forces, although Standard Chartered trailed at 34 globally, it is also the top UK financier of new coal plants in Asia.
The news that Jes Staley has stepped down as the chief executive of Barclays after an investigation by City regulators into how he described his relationship with the billionaire sex offender Jeffrey Epstein come before the latest report.
To reach net-zero from financed activity by 2050, including interim 2030 targets for the most carbon-intensive sectors, that were aligned with the International Energy Agency’s scenario for a net-zero energy system by 2050, Standard Chartered said last week that it would set “ambitious new targets”.
In May, the global energy watchdog said that there could be no new oil, gas, or coal development if the world was to reach net-zero by 2050. A UN report only days later warned that that fossil fuel production planned by the world’s governments “vastly” exceeded the limit needed to keep the rise in global heating to 1.5C and avoid the worst impacts of the climate crisis. Watanabe added:
“The science is clear – banks that keep funding fossil fuels can’t be climate leaders.”
A Barclays spokesperson was not immediately available to comment. A HSBC spokesperson said the bank was “firmly committed” to aligning its provision of finance to net-zero by 2050 or sooner. He explained:
“We have committed to phasing out thermal coal financing by 2030 in EU and OECD markets and by 2040 globally and to set out short and medium-term transition targets for the oil and gas and power and utilities sector. We expect to provide between $750bn and $1trn towards the net zero-transition by 2030.”