Fueling the fire 2016

How the big banks are using our money to support the dirty fossil fuel industry

Photo: Hazelwood Open Mine Fire February 2014 – CFA Communities & Communication

Introduction

The big banks are funding a huge problem.  The ongoing use of fossil fuels is jeopardising our ability to achieve a safe climate future. The coal, gas and oil industries are also damaging our environment, farmland, water resources, health and natural icons like the Great Barrier Reef.

Banks play a critical role in enabling and sustaining fossil fuel projects. Fueling the Fire exposes which banks are supporting the fossil fuel industry and helps you take action to change how these institutions invest.

Since 2008 the big four have loaned 36.7 billion dollars to the fossil fuel industry
With one of the big four?
In three simple steps, you can join thousands of customers working with us to ensure the big banks stop funding dirty fossil fuels
1 Your details
2 Make your divestment count
3 Your message

The importance of the “Big Four”

ANZ, Commonwealth Bank, NAB and Westpac have loaned a combined $70.3 billion to fossil fuels around the world since 2008. Of this total, $49.9b has gone to projects and companies within Australia.

Each of the big four’s total lending to fossil fuels in Australia since 2008 is shown in the graphics below. In the first half of 2016, the big four loaned $3.5b globally to fossil fuel projects and companies, with $480 million of that going to the local industry.

 
ANZ have loaned 16.5 billion dollars to fossil fuels
Commbank has loaned 13.6 billion dollars to fossil fuels
 
NAB has loaned 11.2 billion dollars to fossil fuels
westpac has loaned 8.2 billion dollars to fossil fuels

The Carbon Bubble

If the world is to meet its agreed goal of keeping global warming to less than 2ºC, 80% of current fossil fuel reserves cannot be burned.

By continuing to support fossil fuel companies and projects, banks are creating massive economic risks. Failure to keep a lid on global warming would be an economic, environmental and humanitarian disaster. But serious action on climate change also means that fossil fuel companies face major write downs, as they end up owning coal, oil and gas reserves that are effectively worthless.  Banks supporting fossil fuel companies to develop bigger reserves are just inflating this bubble even further.

We cannot burn it all, maximum resources that can be burned to limit a rise in temp to 2 degrees is 565 GT CO2

As the world moves to limit global warming, trillions of dollars of fossil fuel assets are at risk in the impending ‘carbon bubble’.

Click here to find out more about the carbon bubble.

Two degrees scorecard

ANZ, Commonwealth Bank, NAB and Westpac have all publicly championed the internationally agreed aim to limit global warming to less than two degrees above pre-industrial levels, and committed to support the transition to a low carbon economy. But since these commitments were made in late 2015, each of the big banks have continued to finance and enable new fossil fuel projects, which have no place in any serious plan to stay within the carbon budget.

Click the scorecard below to learn more about how the banks have performed against their two-degree commitments.

Export Credit Agencies

Export Credit Agencies are semi-governmental financial institutions that are often able to lend much more than commercial banks. Their support is integral to the success of many of the largest fossil fuel projects, such as Australia’s massive LNG export ventures. Below are the major ECAs that have provided finance to fossil fuel projects in Australia since 2008.

Export Credit Agency Debt ($AU Millions) Number of Deals Country of Origin
Japan Bank for International Cooperation $8528 9 Japan
Export-Import Bank of the United States $4719 4 USA
Export-Import Bank of China $3711 4 China
Export Development Canada $1371 7 Canada
Korea Exim Bank $649 1 Korea
Development Bank of Japan $404 4 Japan
Export Finance & Insurance Corp $143 1 Australia
Export-Import Bank of India $69 2 India

top lenders by sector

Find out more about where banks are lending in our Tracking the Money series.

Renewable vs. Fossil Fuel Lending

The big four’s lending to renewable energy is vastly overshadowed by their support for dirty fossil fuels.

For every dollar loaned to support renewable energy projects around the world, the big Australian banks have provided eight times as much to fossil fuels on average. The graphic gives a sense of this major disparity.

Worryingly, bank lending to renewables ground almost to a halt in the first of 2016, with neither ANZ nor CommBank providing a single dollar to the sector.

ratio of renewable energy lending to fossil fuel lending by the big four

lending to coal and gas in the reef

Bank Debt ($AU Millions) Number of Deals
ANZ $4130 15
Commonwealth Bank $3163 12
Westpac $2815 16
NAB $2094 10

Having seen the worst ever bleaching event already in 2016, there’s no denying our Great Barrier Reef is in desperate trouble. Its single greatest threat is climate change, and it is further damaged by increasing coastal industrialisation and shipping through its waters.

Despite the havoc wreaked by coal and gas export projects in the World Heritage Area, banks have continued to loan billions to projects like Adani Abbot Point and the three massive LNG projects at Curtis Island, with Commbank clearly the worst offender.

 
abbott point terminal puts the reef at risk

Bleached coral in the Great Barrier Reef

galilee basin

Adani Abbot Point Coal Terminal

Take Action

With one of the big banks? Put them on notice

In three simple steps, you can join thousands of customers working with us to ensure the big banks stop funding dirty fossil fuels
1 Your details
2 Make your divestment count
3 Your message

Is your super invested in fossil fuels?

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Take action today to make your super fossil fuel free.

www.superswitch.org.au