Bank of America backs away from coal financing
Citing global warming, environmental impacts, and the ongoing transition to lower-carbon energy, Bank of America has announced that it will “reduce its credit exposure” to coal extraction. In particular, BoA will put more scrutiny on the environmental compliance records of its creditors, and reduce its involvement in mountaintop removal mining. While not going cold turkey on coal, BoA’s new Coal Policy marks a significant step forward for the bank, which as recently as 2014 was the largest investor in coal projects among US banks (Chinese banks dominate the Top 20 in a recent summary; BoA was #15, with $1.3 billion invested, out of a global total of $141 billion). Within the resilient investing system, this is part of a widespread rethinking taking place in our Zone 8, where financial assets are at work in the sustainable global economy.
Already, BoA’s renewable energy portfolio is three times the size of this diminishing support for coal; the company has acknowledged the financial and social risks of global warming, and is moving to be part of the transition to a less carbon-intensive energy system. To be clear, though, they do not foresee a renewables revolution: their picture is very much in line with the mainstream consensus that sees increased use of natural gas, modest decreases in coal, the emergence of some carbon capture and storage, and a continued but gradual increase in renewables between now and 2040.