Tokyo, Japan, 10 September 2020 – Japanese megabanks Mizuho Financial Group, Sumitomo Mitsui Financial Group (SMBC) and Mitsubishi UFJ Financial Group (MUFG) are wasting billions financing coal companies in Europe. This support not only undermines the clean energy transition, but also risks creating stranded fossil assets as the coal decline accelerates, according to a new report.
Fool’s Gold – The financial institutions risking our renewable energy future with coal examines eight European, and four significant international, financial institutions with close ties to Europe’s eight most polluting coal companies. These energy companies were responsible for half of all EU coal-based CO2 emissions in 2019. The research finds that in the year after the IPCC released its 1.5 degrees C special report in October 2018, the coal companies received continued support from financial institutions, including Japanese banks.
The data shows Mizuho Financial Group (€1.0 billion), Sumitomo Mitsui Financial Group (SMBC, €0.6 billion) and Mitsubishi UFJ Financial Group (MUFG, €0.3 billion) provided loans and underwriting worth €1.9 billion in total to major European polluters, including Germany’s RWE and Uniper, Poland’s PGE, Czechia’s CEZ, Finland’s Fortum, and Italy and Spain’s Enel / Endesa. These Japanese banks are ranked the 9th, 19th and 29th most significant creditors in the European coal power industry.
Though Japanese banks published renewed sustainability policies in May and June, the policies only committed to ending financial support to individual coal power projects in the form of project finance.
- The full report in English: LINK
- Japanese translation of the briefing paper focusing on Japanese banks: LINK
Author of the report, Senior Finance and Utility Coordinator at Europe Beyond Coal, Kaarina Kolle said:
“These financial institutions knew very well when the UN Paris Climate Agreement was signed that exiting coal was an immediate priority. That they are to this day still supporting coal companies with billions of euros, after more unequivocal scientific guidance from the Intergovernmental Panel on Climate Change, shows that the financial institutions are consciously undermining climate action.
Every financial institution we looked at claims to restrict coal, but the figures speak for themselves. Policies are often carefully crafted to look positive, while retaining money flows to dirty energy. It’s time to draw a line in the sand: if these European companies do not have a 2030 coal phase-out plan, investors and banks must exclude them without delay.”
Commenting on the results of the study, senior energy campaigner at Greenpeace Japan, Daniel Read said:
“This study is the latest piece of evidence that shows how the Japanese banks continue to financially support the coal industry and some of the world’s dirtiest companies. By doing so without requiring their corporate clients to decarbonize fast enough, the banks are making it more and more difficult for the world to reach the objectives of the Paris Agreement.
As Japan continues to face more extreme weather events, MUFG, Mizuho and SMBC have to take their share of responsibility. Simply ending direct support for coal power projects is not enough. The Japanese banks must urgently develop new policies that ensure no more money goes into continued use of coal that accelerates the ongoing climate crisis.”
- The report was produced by Europe Beyond Coal and its partners, BankTrack, BlackRock’s Big Problem, Ember, Fundacja “Rozwój TAK – Odkrywki NIE”, Friends of the Earth Finland, Friends of the Earth France, Greenpeace, Reclaim Finance, Re:Common, ShareAction, Urgewald and 350 Japan.
- Europe’s eight most polluting coal companies covered in the research: RWE, PGE, EPH, ČEZ, Enel/Endesa and Fortum/Uniper.