PLATFORM Unravelling the CarbonWeb
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Unravelling the Carbon Web is a project by PLATFORM. We work to reduce the environmental and social impacts of oil corporations, to help citizens gain a say in decisions that affect them, and to support the transition to a more sustainable energy economy.


Read "Cashing in on Coal"

The "Oyal Bank of Scotland" campaign

Bankrolling Coal

Not just the Oil & Gas Bank 

As national controversy grows over proposals for a set of seven coal-fired power stations, UK banks are fuelling the global coal boom – the ‘roll to coal’.

PLATFORM’s recent report, Cashing in on Coal, finds Barclays and HSBC trailing behind the UK leader in fossil fuel investments, RBS-Natwest.  The report estimates that in the last two years, RBS was responsible for $15.93 billion of financing of companies involved in extracting or burning coal - compared to Barclays’ $5.79 billion and HSBC’s $10.10 billion - from Germany to India, from Portugal to Australia.

Financing coal mines and power plants in today's carbon-constrained world can never be sustainable practice. However, RBS is involved in financing many of the most controversial companies involved in rapid coal expansion, some of which are engaged in practices with particularly harmful social and environmental consequences. The bank participated in two mega loans totalling $70 billion to German power-giant E.ON – either side of the company’s announcement of plans to build 17 new coal and gas power plants across Europe. E.ON has generated a great deal of controversy over its plans to build a new coal-fired power station at Kingsnorth in Kent – the first in 30 years in Britain. Its critics have included NASA scientist Dr James Hansen, a large cross section of NGOs ranging from the RSPB to the Women’s Institute and more than 2,000 direct action campaigners who took part in August's Camp for Climate Action.

Elsewhere, RBS took part in providing $800 million of credit to Arch Coal, the US’ second largest coal producer. Arch Coal has been heavily involved in mountain-top removal mining (MTR) – a practice of blasting off the tops of mountains with powerful explosives, then dumping the mountain-tops into nearby valleys. Rather than remove the coal from the mountain, MTR involves removing the mountain from the coal. More than one million acres of biologically diverse hardwood forests in Appalachia, eastern USA, have already been decimated. For local communities, MTR means the loss of thousands of jobs, growing poverty and increased health risks from toxic coal sludge.

While providing billions to companies like E.ON and Arch Coal, RBS claims to be addressing the environmental and climate impacts of its operations. It is particularly proud of two recent events it hosted: its 2008 Annual Economic Lecture titled “Towards a low carbon economy” and the UK Low Carbon Economy Summit co-organised with the Department for Business, Enterprise and Regulatory Reform that took place at the Tate Modern in London.

In the event’s opening speech, RBS Chairman Sir Tom McKillop laid out his company’s position: “As a leading banking partner of the energy sector for many decades, RBS recognises its responsibility in addressing these challenges.” The statement would be commendable, were it true. While proudly advertising RBS’ $3.5 billion of support to renewables over two years, McKillop did not deem it relevant to mention the total volume of support for fossil fuel companies - and RBS has consistently refused to take any responsibility for that lending. Financing of coal companies alone was around five times that of renewables. As this double-speak becomes harder to sustain, McKillop is rapidly undermining RBS’ credibility in addressing climate change.

The government, alongside coal-burners like E.ON and RBS, argue that a supposed ‘energy gap’ in 12 years time justifies the expansion of fossil fuel infrastructure and deflect propositions for co-ordinated action on climate change. However, the recent Poyry Report by twelve of Europe’s top scientists lays out paths to a stable UK energy future that combines targets for reduced usage and increased efficiency of power, alongside stepped-up renewable energy programs.  There is a clear need to find a path forward that ends our dependency on fossil fuels, as there is little point in keeping the lights on if the house is flooded.

RBS has positioned itself to take the credit for organising green conferences and lending to renewables. At the same time it is planning to keep providing the financial fuel that drives the global coal boom, locking us into decades of carbon emissions and pushing us perilously closer to the two degree tipping point of runaway climate change.