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Surpasses Two Important Milestones
Despite all the talk of increased opposition, alternative electricity generation continues to overtake some of the nation’s most used traditional energy sources, including fossil fuels. Why? Because its long-term advantages are undeniable, both in terms of lower environmental impact and now lower cost-per-watt.
Clean Energy Funding Now Surpasses Fossil Fuels’
According to Bloomberg, for a second straight year banks are making more money providing loans and underwriting bond sales for green-related projects than they’re earning from fossil fuel companies.1
Together, banks have generated about $2.5 billion of revenue from climate-focused financing so far this year, compared with $2.2 billion from their work with oil, gas and coal companies, according to data compiled by Bloomberg.
It’s a big change from as recently as 2020, when lenders pocketed almost double the fees from Big Oil than they did from backing green initiatives.
Banks have faced considerable criticism in recent years for their support of the fossil fuel industry, the primary source of planet-warming pollution. Financiers have sought to defend themselves by claiming they want to assist in the transition to a low-carbon economy by staying engaged with the industries most responsible for the accelerating climate crisis.
At the same time, growing numbers of banks have acknowledged the risks of the crisis by increasing their ambitions around green financing. For example, JPMorgan Chase & Co. announced emissions-reduction targets late last year for airlines, cement manufacturers and iron-ore and steel companies. That added to the bank’s first set of goals, which focused on the oil and gas, electric-power and auto-manufacturing sectors.
Most climate change trackers agree, however, that as encouraging as this new milestone in green energy generation is, the green-to-fossil fuel ratio is still far from where it needs to be, and will require an extraordinary ramp-up in green investment to reach 1.5C goals in time.
Funding for fossil fuels is on the decline. (Adobe stock photo #588282318)