A new report produced by the campaigning organisation Platform reveals the extent of global banks’ funding for the world’s most polluting activity. And RBS, which is 84% owned by the UK public, is the biggest lender.
The campaign to stop RBS and the Royal Bank of Canada from funding the extraction of oil from tar sands in Alberta was stepped up this week with protests in London and Toronto. The Platform report explains how tar sands extraction is devastating Indigenous communities, wildlife and vast areas of boreal forests, as well as being many times more carbon-intensive to produce than “conventional” oil.
“The higher oil prices in recent years have meant that it’s become a more attractive prospect for oil companies to expand their operations in the costly process of obtaining and processing the thick bitumen into a usable form. It’s estimated that the industry is looking for a capital investment of $120-$220 billion over the next 20 years to build the new pipelines, mines, refineries and upgraders that are necessary to sustain the boom,” says campaigner Kevin Smith.
In fact, the banks have blood on their hands, says George Poitras, of the Mikisew Cree First Nation: “We are seeing a terrifyingly high rate of cancer in Fort Chipewyan where I live. We are convinced that these cancers are linked to the Tar Sands development on our doorstep. It is shortening our lives. That's why we no longer call it 'dirty oil' but 'bloody oil.”
The report scrutinises Investments of 26 banks from across the world, including Barclays, RBS and HSBC – both their direct lending to companies involved in tar sand extraction and to others involved indirectly, for example, in transporting the oil.
Platform, and other organisations, are mounting a further legal challenge to the UK Treasury, insisting that the government could and should make RBS halt this investment. When first hauled into court last year, the Treasury claimed that any such restriction would be interference in RBS’ profitability, and that it would be inappropriate for ministers to impose wider policy objectives on RBS.
But the campaign disputes this standpoint and says that the government could issue some instructions if it wanted to. After all, tar sands extraction runs entirely counter to the government’s own stated policies on sustainable energy and carbon reduction.
What this case underlines is the extent to which the corporations, and their financial backers, are the driving force of climate change and that they are not going to change now.
RBS had losses of £3.6bn in 2009, but the losses were lower than expected. There is no doubt that all the banks will continue to pursue any potentially profitable investment, and for them fossil fuels are one of the routes back to improved balance sheets. Another example is that of Chase Manhattan, under attack for funding the most environmentally-damaging open cast coal mining in the US.
Green campaigners sometimes speak about ending “our addiction to fossil fuels”. In the case of individuals this is a misleading characterisation – we are not addicted to fossil fuels, we are force fed them in a million different ways.
But in the case of the banks, it is spot on – though it might be more accurate to say they are addicted to profit. Faced with the options of making a fast buck from investing in proven, but polluting, technology or investing in cutting-edge sustainable technology that may not deliver profits in the short term – you know what decision the banks are going to make.