Clean tech fans and advocates for renewables have long made the case that decarbonization is a bottom line twofer, providing direct financial benefits to companies while contributing to a more sustainable planet for all. Now the giant U.K. banking firm Barclays has taken that framing and articulated it as a roadmap for action under the title, “Energy and Climate Change.”
Right from the start, Barclays emphasizes that banks have a leading role in ensuring that the world’s energy needs are met. That type of framing has been used in the past by ExxonMobil and other fossil fuel stakeholders.
Barclays does start off with an introductory statement that lays out the challenge in no uncertain terms:
“Climate change represents one of the greatest challenges faced by the world today.”
“Banks have an important role to play in ensuring that the world’s energy needs are met while helping to limit the threat that climate change poses to people and to the natural environment.”
“Banks have a direct environmental and social impact through their operational footprint, as well as indirectly in the way that they mobilize capital, advise clients and develop products.”
“Our aim is to help facilitate the transition to less carbon intensive sources of energy, while supporting economic development and growth in society by helping to ensure the world’s energy needs are met responsibly.”
The argument for decentralized renewable energy is evident in off-grid and underserved communities, where expensive transmission lines and central power stations have failed to penetrate.
Christian Aid is one organization that has been putting pressure on Barclays to decarbonize, and quickly. In an emailed statement reacting to the new roadmap, Christian Aid lauded the banks’ decision to stop financing coal power and coal mining globally.
However, the organization also noted that Barclays will continue a financial relationship with coal companies and, notably, continue to finance tar sands oil.
Barclays certainly does not hide those intentions in the Energy and Climate Change roadmap. Of the three main areas of action Barclays lays out, one of these is:
“. . . Taking a responsible and sustainable approach to the necessary financing of sources of energy that are more carbon intensive or those with higher environmental impact . . .”
In the other two main areas of action, one commits Barclays to reducing the carbon footprint of its own operations.
That’s not particularly groundbreaking, considering the progress that many other major global companies have been making.
What is newsworthy is the third area, in which Barclays pledges financial support for renewable energy stakeholders and other businesses that tackle global environmental issues.
In this area, Barclays makes the case for decarbonization as an economic driver, citing “economic benefits” in the area of $26 trillion by 2030, including more than 65 million new jobs.
Barclays also cites the $90 trillion in new investment opportunities, in support of new technologies and efficiencies as well as more sustainable infrastructure.
The roadmaps commit Barclays to stepping up “green opportunities” across all sectors of its business, coordinated through a newly established Green Banking Council.
The commitment includes an important caveat, though:
“At the same time, we are mindful of the complex challenges faced by countries seeking to strike a balance between achieving sustainable economic development and industrialization, while trying to mitigate climate change and adapt to its consequences.”
On the other hand, the global energy market is already beginning to do some of the heavy lifting for Barclays and other banks.
As the cost of solar and wind power continues to drop, high risk investments in fossil fuels are becoming more difficult to justify.
To cite one recent example, the International Renewable Energy Agency (IRENA) has just come out with a new report, finding that noted that solar power is now competitive with fossil fuels in the oil-producing Gulf Cooperation Council countries.
It could be that the most financially responsible path to “energy security” is renewable energy after all.
Image credit: Hakan Dahlstrom/Flickr