Westpac has committed to have zero exposure to thermal coal mining by 2030 and to ensure its financing of the electricity generation sector supports Paris-aligned transition pathways to a net zero emissions economy by 2050.
The bank’s latest climate change action plan also said it aimed to provide $3.5 billion of new lending to climate change solutions over the next three years.
Westpac said its climate change actions were:
- Aim to provide $3.5 billion of new lending to climate change solutions over the next three years;
- Ensure its financing of the electricity generation sector supports Paris-aligned transition pathways to a net zero emissions economy by 2050;
- Support existing thermal coal customers, with a commitment to reduce its exposure to zero by 2030;
- Advance its Paris-aligned financing strategies and portfolio targets, with annual updates;
- Provide access to products and services that can help customers to reduce the energy consumption, and improve the resilience of their homes;
- Help communities become more resilient to climate change and the transition to a low carbon economy;
- Target emissions reductions for our own operations in alignment with a science-based trajectory;
- Source the equivalent of 100% of our global electricity consumption through renewable sources by 2025; and
- Support policy outcomes aligned to net zero emissions by 2050.
Environment finance group, Market Forces said the commitment by the bank was another nail in the coffin for thermal coal.
Market Forces executive director, Julien Vincent, said: “Westpac’s policy is another nail in the coffin of the thermal coal industry and a stark warning to a federal government trying to leverage the COVID-19 pandemic to give the fossil fuel industry a leg up. This plan shows it won’t be happening with Westpac’s cooperation.
“Last year, Commonwealth Bank was the first to commit to be out of thermal coal by 2030, along with all three of our general insurers. Now, anyone trying to operate a coal mine or power station in Australia by the end of this decade will need to do it without Westpac as well.”
Market Forces noted the bank appeared to have made a “subtle commitment to not finance new oil and gas projects” and this indicated that any financing of the sector from this point on would need to be compatible with the Paris Agreement.
It also said since 2016, Westpac loaned $5.4 billion to coal, oil, and gas projects including $846 million to projects that expanded the scale of the fossil fuel industry. Since committing to the Paris Agreement, the bank had loaned 2.7 times as much money to fossil fuels as to renewable energy.
“Westpac’s policy comes out as we contemplate what sort of future we want for our economy. With the frailties of the coal, oil and gas sectors laid bare by the economic impacts of COVID-19, and the horror summer of bushfires still fresh in our minds, the time has come to move on from polluting fossil fuels once and for all,” Vincent said.