One week before Climate Finance Day, top French banks Crédit Agricole and Société Générale have followed the lead of Natixis and announced the end of their financing for coal power plant projects globally, moves welcomed by Friends of the Earth France. However, the group criticised Crédit Agricole and Société Générale for pressing on with support for new coal power projects in Indonesia and the Dominican Republic. BNP Paribas now finds itself as the only major French bank not to have committed to ending its direct financial support for coal power plants.
The new policy measures from Crédit Agricole and Société Générale complement other coal finance restrictions adopted by both banks in 2015 when they announced an end to their direct financing of coal mining projects and a cessation of direct financial support for coal power projects in ‘high income’ countries .
Lucie Pinson, private finance campaigner for Friends of the Earth France, commented:
“Crédit Agricole and Société Générale have lined up next to Natixis which in 2015 grasped that the only credible policy was one which ruled out all project financing for new coal plants worldwide. BNP Paribas now finds itself isolated as the last major French bank which continues to permit direct financial support for coal plants. However, just like Crédit Agricole, BNP Paribas committed at the Paris COP last year to do everything possible in order to ensure that the objectives of the Paris Agreement are met or exceeded.
“BNP Paribas must now make the same commitment as its peers so that the French banking sector can become the global leader in ending direct financial support for coal, the sector which remains the most incompatible with the objectives of the Paris Agreement.”
The climate impacts of these new moves from Crédit Agricole and Société Générale are limited, however, as they apply only to project financing. The majority of banks’ support for the coal industry is done through business financing and services.
Yann Louvel, Climate and energy campaign coordinator for BankTrack, commented:
“The crucial thing right now is to prevent hundreds of new coal plant projects around the world from accessing finance, whether it be direct or indirect financing. The latest announcements from Crédit Agricole and Société Générale may be going in the right direction, but they remain insufficient as the banks are still able to finance the companies which build these projects.
“Only Société Générale is saying that it intends to reduce its support to coal companies in order to be in line with the 2 degrees scenario trajectory of the International Energy Agency by 2020. This is an interesting approach from the bank, but it needs to be complemented by the adoption of specific exclusion criteria in order to send a clear signal to companies in the coal sector.”
Friends of the Earth France has also criticised the new commitments from Crédit Agricole and Société Générale as they do not apply to coal power projects in Indonesia and the Dominican Republic where both banks are involved and, in the case of Société Générale, the commitments will only take effect in 2017.
Lucy Pinson concluded:
“We denounce the double game of Crédit Agricole and Société Générale, as they have not withdrawn from proposed coal power plant projects in Indonesia, although no funding has been decided yet in these cases. We also remain cautious about how this new commitment from Société Générale will be applied, as the bank has recently been violating all of its coal power policies dating as far back as 2011 with its financing of the heavily polluting and outdated Punta Catalina coal plant in the Dominican Republic.”
Source: BankTrack
