Banks Funding Green Steel Initiatives Linked to Increased Emissions, Report Finds
A report by BankTrack reveals that 19 of 20 major banks financing low-carbon steel projects are backing initiatives termed 'false solutions' that may increase greenhouse gas emissions. These include methods relying on natural gas and hydrogen injection. The steel industry, responsible for 11% of global emissions, needs up to $335 billion for decarbonization by 2050. However, only 7% of financing from 2019 to mid-2024 supported green initiatives. Lloyds Banking Group is the only bank not funding false solutions, with Barclays and Societe Generale also recognized for aligning with real decarbonization strategies.
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BankTrack's analysis shows that nearly all major banks, except Lloyds Banking Group, are financing steel projects classified as 'false solutions' that could increase greenhouse gas emissions. The report indicates that steelmaking, which accounts for 11% of global emissions, is critical for decarbonization, requiring substantial investment.
Between 2016 and mid-2023, banks provided $429 billion to top steel producers, yet only 7% targeted green initiatives. Effective decarbonization methods include electric-arc furnaces with renewable energy and green hydrogen. Lloyds, Barclays, and Societe Generale were noted for their alignment with true decarbonization strategies.
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