Whether we avert catastrophe with climate change may actually be decided
by Citibank and Bank of America.
by Tara Lohan
AlterNet (October 06 2007)
We're nearing the end of the window of opportunity we have to avert the
catastrophic effects predicted from the earth's changing climate. We're
either going to sink or swim. Our best hope at this time is to
drastically reduce our greenhouse gas emissions, like carbon dioxide.
Global leaders are putting their heads together to come up with
solutions. Across the world, countries and municipalities are passing
legislation to limit greenhouse gas emissions; people are cutting
consumption; new technologies are being developed to further alternative
energy sources. And yet, in the United States, the coal industry has us
poised to move in the absolute wrong direction. Right now, there are
about 150 new coal-fired power plants on the drawing board. The amount
of polluting emissions they will release is staggering - between 600
million and 1.1 billion tons of carbon dioxide emissions every year, for
the next fifty years. And this, according to Rainforest Action Network
(RAN), will basically negate every other effort currently being
considered to fight climate change.
Over the last twenty years since Bill McKibben wrote the first global
warming book for a general audience, only a few things have changed:
Scientists have realized the problem is worse than they thought, and the
crisis is coming on faster than predicted.
"The final question as to whether we can address it in serious fashion
is whether the coal that is in the ground stays in the ground", said
McKibben. "We already know that we are going to burn all the oil we can
get our hands on because we have gotten our hands on most of it and it
is intensely valuable. Coal, on the other hand, is the question. If the
150 power plants get built, there is no use talking about compact
fluorescent light bulbs or mass transit or any of those other things ...
we'll have no hope of averting climate change short of catastrophic
proportions."
And what's the quickest way to halt those plants? Follow the money {1}.
Without funding from banks, companies don't have the resources to front
the $140 billion necessary to construct all those new dirty power
plants. Rainforest Action Network learned that the money trail is not so
complicated; it leads to two main banks - Citi and Bank of America.
The Case Against Citi
Citi currently holds the title as the world's largest bank and biggest
company. A few years ago, they also were leading the way in addressing
environmental and human rights concerns in their industry. As RAN
details in their new report "Banks, Climate Change and the New Coal
Rush" {2}: In May 2007, Citi pledged to "direct $50 billion over the
next ten years to address global climate change through investments ..."
Financing for renewable energy, energy efficiency and improvements in
energy infrastructure amount to $31 billion spread across ten years.
While this may seem like a significant commitment, it amounts to less
than 0.2 percent of the company's $2.2 trillion in assets. What is Citi
doing with the other 99.8 percent? The answer to that question is that
Citi has been busy funding dirty energy. Last year they gave 200 times
more money for dirty energy than for clean. In the process they've
helped underwrite some of the world's worst environmental and human
rights offenders. Here's a sample:
* In 2006 they gave $4 billion to Peabody Energy, the world's largest
coal mining company, which has been ravaging Dine and Hopi lands for
forty years, taking 2.5 million gallons of water out of their desert
watershed each day and leaving behind a trail of toxic waste.
* In 2006 they gave $400 million to Drummond, a mining company, which is
facing repercussions for allegedly hiring paramilitary groups to kill
Colombian coal miners trying to unionize.
* They've given billions of dollars to Massey Energy, Arch Coal, Alpha
Natural Resources, and other coal companies that practice mountaintop
removal (MTR) coal mining that involves blowing the tops off of
Appalachian mountains, filling valleys, burying streams, poisoning
waterways and impoverishing communities.
* Citi helps finance American Electric Power (to the tune of $12
billion), which is working to maintain its designation as the single
biggest greenhouse gas polluter in the country by building five new
dirty coal plants, adding another 21 million tons of carbon dioxide to
their annual emissions of 163 million tons.
* Citi is also the top underwriter of scandal-tainted Dynegy (involved
in the Enron debacle and price manipulations in California) that is
leading the industries' coal rush and plans to build eight new plants,
increasing their carbon dioxide emissions by 200 percent.
The case against Bank of America
Bank of America is not far behind Citi. It has also pledged to become an
environmentally sustainable business, but it doesn't seem to walk its
talk. Last year it spent 100 times more on dirty than clean energy, and
it gives less than 0.2 percent to helping fight climate change.
Like Citi, BOA is making friends with some of the world's worst companies.
* They've given big money to companies that are devastating Appalachia
with MTR mining. Arch Coal got $700 million and long-repudiated Massey
Energy scored $175 million.
* The disastrous Peabody Energy got $4 billion last year from BOA, which
should help them on their way to building new plants in New Mexico,
Illinois and Kentucky.
* Alpha Natural Resources also got $525 million to help its 27 surfaces
mines in Appalachia.
The stupidity factor
The reasons for moving away from coal are overwhelming. Scientists tell
us we have about a decade to stabilize carbon dioxide emissions and the
easiest way to do that is to cut down on coal consumption - the number
one contributor to climate change.
Each year, the American Lung Association reports, an estimated 24,000
people in the United States die prematurely from pollution emitted by
coal-fired power plants. And it is not just the burning of coal that is
dangerous - extraction, especially practices like MTR coal mining that
blow the tops off mountains, are devastating to the land and the people.
"The banks are funding this war on Appalachia, and they are funding
domestic terrorism", said Judy Bonds, a tenth generation mountaineer in
West Virginia who is the founder of Coal River Mountain Watch and the
winner of the Goldman Environmental Prize.
"We are being bombed every day by three and a half million pounds of
explosives. We can smell and taste explosives. They damage our homes,
shake our nerves and poison our air", she said. "The banks are helping
coal to take the wealth from us, to steal us blind and leave us in
poverty, and leave us in poison". Despite the overwhelming environmental
and humanitarian concerns, even from an investment standpoint, putting
your chips on coal is a sure loss.
In the last few years, a political upswing has occurred in the fight
against climate change. Al Gore's film and the success of grassroots
movements like Step It Up, which organized 1,400 rallies in all fifty
states, has garnered momentum.
Other countries have already begun regulating carbon, and the United
States will follow suit. Currently there are a handful of bills in
Congress to cap emissions and establish a carbon-trading program in the
United States, making polluters pay.
"Coal looks cheap at the moment because we charge it nothing for its
environmental damage", said Bill McKibben. "But when we do, you need to
be a real sucker for wanting anything to do with new coal".
Coal, he added, "is about to become as expensive fiscally as it is
environmentally".
Laying out money for dirty energy just doesn't make good business sense.
When investors look at the proposition of financing coal plants, they
have to look at future returns, and when you look at banks like Citi and
BOA, said Leslie Lowe of the Interfaith Center on Corporate
Responsibility, "you have ask, 'what are they thinking?' It is clear we
will have a cost for carbon in this country, so every coal plant that
emits more carbon dioxide will be a liability long-term."
Funding the future
Fortunately, we have the choice to move this country in the right
direction by pressuring Citi and BOA to fund clean, instead of dirty,
energy.
If those banks took the $141 billion they plan to spend on building new
coal plants, and instead invested it in energy efficient measures, they
could reduce electricity demand by nineteen percent by 2025.
RAN reports that, "By 2020, the US could meet twenty percent of its
electricity needs from renewable sources. This would avert the need for
975 new power plants, allow for the closing of 180 old coal plants and
fourteen existing nuclear plants, and save consumers $440 billion". The
push for no new coal is being echoed across the country. Step It Up and
One Sky Campaign are both calling for a moratorium on new coal power
plants, as well as an eighty percent carbon reduction by 2050 and the
creation of five million green jobs to help us conserve twenty percent
of our energy by 2015.
"By transitioning to a clean energy future that prioritizes energy
efficiency - and clean renewable sources like solar and wind power - we
can meet our future energy needs, build a stronger economy, keep our
communities healthy and curb climate change", RAN's report advises.
"Tell Citi and Bank of America to stop funding dirty coal projects and
to redirect their resources and investments toward clean energy. Don't
let your money be used to fund climate change".
Notes:
{1} "Who's Funding Global Warming?" by Tara Lohan, HP's Printer
Cartridges Are an E-Waste Disaster -- Does the Company Really Care?
(February 05 2007) http://www.alternet.org/environment/47615/
{2} http://ran.org/presskit/
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Tara Lohan is a managing editor at AlterNet.
© 2007 Independent Media Institute. All rights reserved.
