The bank has made a ‘dramatic turnaround’ after it loaned at least $7.2 billion to coal, oil, and gas companies and projects two years after the Paris Agreement.
The announcement follows commitments by insurers QBE and Suncorp to exit the sector by 2030 and 2025, respectively.
The Commonwealth Bank said it would continue to reduce its thermal coal mining and coal-fired power generation exposures with a view to exiting the sector by 2030, subject to Australia having a secure energy platform.
It would also only finance new oil, gas or metallurgical coal mining projects if they demonstrated they were compatible with the goals of the Paris Agreement, and would not project finance for the mining, exploration, or development of oil sands, or for oil and gas exploration and development in the Arctic.
Market Forces executive director, Julien Vincent, said firms looking to run a thermal coal mine or coal power station in Australia beyond 2030 would not be able to get financing from Australia’s largest financial institution, or insurance from two main underwriters.
“The exit of Australia’s largest company from coal should be a signal loud enough to be heard by the industry bosses and politicians who have their fingers in their ears over the need to decarbonise the economy,” said Vincent.
“Now Australia’s other big banks need to step up and show the same kind of intent to get out of coal.”
However, Market Forces noted the commitment by the Commonwealth Bank was a “dramatic turnaround” as the two years following the Paris Agreement being signed, the bank loaned at least $7.2 billion to coal, oil and gas companies and projects.
“More recently, Commonwealth Bank has issued loans to Australia’s three big coal power station operators Energy Australia, AGL and Origin, all of which intend to keep running coal power plants beyond 2030 and the latter having plans to massively expand gas extraction,” the firm said.
The organisation called on the bank to eliminate potential loopholes over financing new coal, oil, and gas projects.
|
Bank |
Coal Power |
Thermal coal mining |
|
CommBank |
Zero exposure by 2030 |
Zero exposure by 2030 |
|
ANZ |
Excludes projects of more than 0.8 tonnes CO2 / MWh |
Excludes new to bank customers with more than 50% of revenue from coal |
|
NAB |
No policy restrictions |
Will not finance new thermal coal mines or extensions |
|
Westpac |
Target of average power sector emissions intensity of 0.3 tonnes CO2 / MWh by 2020 |
Will not finance new thermal coal basins or projects with energy content less than 6,300 kCal / tonne |
