Billions for major climate-damaging projects

Arctic Oil drilling

By Claus Hecking

Published December 10th, 2020, 6:29 am here

The German bank supported with billions loans companies are behind some of the major projects klimaschädlichsten fossil fuels for the production. This is a key finding of the “Five Years Lost” study, in which environmental protection and non-governmental institutions examined the financing of twelve international mega-projects for the extraction of coal, crude oil and natural gas. The investigation will be published this Thursday and was available to SPIEGEL in advance. Anzeige

According to her, Deutsche Bank is providing the operators of these twelve mammoth projects with loans and guarantees totaling $ 27.6 billion. In addition, the institute holds shares and bonds of the participating companies in the amount of 10.4 billion dollars. According to the study, the bank is to indirectly finance new coal mines in India , coal and gas-fired power plants in Bangladesh and oil wells in the Norwegian Barents Sea.

If all twelve mammoth projects are implemented as planned, their CO2 emissions would, according to the study, account for around three quarters of the total carbon budget that mankind has left in order to limit global warming to an average of 1.5 degrees Celsius.

Nevertheless, international banks are providing the project operators with loans and guarantees totaling 1621 billion dollars:

  • The front runners are the US financial groups Citigroup (103.7 billion dollars), Bank of America (98.9 billion) and JP Morgan Chase (92.4 billion),
  • this is followed by the British Barclays (66.4 billion).
  • Deutsche Bank ranks 14th, making it the fifth most important European lender.

“All projects include companies that are supported by Deutsche Bank and other German financial institutions through loans, guarantees and investments,” says Katrin Ganswindt, financial expert at the environmental organization urgewald, who was involved in the study. Commerzbank provided a good nine billion euros in loans . Several German Landesbanken and the state-owned Kreditanstalt für Wiederaufbau ( KfW ) also gave loans and guarantees in the three-digit million range.

In addition, financial corporations hold shares or bonds worth around $ 1,100 billion in participating companies such as BP , ExxonMobil or Siemens . The most important investor is the world’s largest asset manager Blackrock (110 billion dollars) – although its boss Larry Fink recently promised that Blackrock would divest investments with significant sustainability risk. Deutsche Bank ranks 19th with its $ 10.4 billion.

“Extensive internal guidelines and processes for the identification and handling of risks to the environment and society apply to the business of Deutsche Bank, which are intended to prevent our business activities from contributing directly to the negative effects described,” said a company spokesman MIRROR. “However, the challenges with larger conglomerates also exist here.” The report will be looked at and then further commented if necessary.

Allianz invests billions in project operators

The Alliance holds according to the study bonds and shares of the project operator, worth more than 9.6 billion dollars. The insurance group has promised to make its portfolio climate neutral by 2050. Nevertheless, he participates in companies that want to develop large-scale oil and gas in Suriname or build new coal-fired power plants in China.

A company spokesman said that Allianz is expressly committed to climate protection and the 1.5-degree target: “Since 2015, we have had a dedicated approach to excluding personal investments in coal, which has already led to a significant withdrawal from this area and provides for a further gradual reduction. «The spokesman did not comment on the specific investments made by Allianz in the operators of the mega-projects.

The DZ-Bank, the central bank of the Volks- und Raiffeisenbanken, and the Sparkasse fund provider Deka are also involved in the operators of the mega-projects with investments of billions.

Developing new sources of coal, oil and gas when we are already experiencing climate change firsthand is completely crazy. Nevertheless, such mega-projects will continue to be financed, ”says Ganswindt. “Investors bet against our future – and at the same time expose themselves to the risk of an enormous decline in the value of their investments.” Ultimately, it could happen that funding will be stopped prematurely for climate protection reasons.

Then not only the project operator has a problem. But also their financiers.

Author: theunderminer

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