I don’t think we should wind down the financing of projects currently essential to our life. I think we should increase lending and back more promising innovative projects that would allow us to shift more away from fossil fuels as well as build more renewable energy / dams and battery energy storage
I also think the government should back more projects. Note that none of that requires to abandon fossil fuel lending. The lenders will shift themselves as fossil fuels become less viable
Realistically lenders who start shifting polluting assets don’t wind them down and nor does the company they lend to. They just sell the projects to private unlisted companies who don’t have ESG concerns from retail investors^1.
Instead of greenwashing and pretending fossil fuels are too dirty to handle, we should be rapidly innovating and pouring money into decarbonisation so we can naturally abandon a worse technology.
I’m interested to understand how banks with a track record of pouring funds into fossil fuels form part of the solution? (without being forced to change their ways)
Do you have any examples of banks operating in this sort of “activist investor” style manner? Even if they were, how would we be likely to know?
Rest assured, this is an attempt at discussion, not argument
Banks should lend to what is commercially viable - alternative energy is cheaper and currently energy prices are tied to gas. So the answer is, seek approval, finance and then pay back the loans. Get it running before winter and enjoy the price hikes.
Once the time for gas and oil isn’t profitable enough that the firms redirect to other things, then it’s the time to stop financing both gas and oil. Until then, it’s a duty for our state to ensure that we have sufficient reserves for strategic purposes, in my opinion. The fact we don’t have them is grotesque and a travesty
Chicken and egg though isn’t it. The default for heating new homes built today is still gas central heating, and worse those houses aren’t even designed to accomodate heat pumps or similar in the future as retrofit options.
While that’s happening, how do you stop prospecting gas from being commercially viable? If the answer is ‘you can’t’ then how do you stop electricity price from being fundamentally driven by gas pricing?
If the past few years have taught us anything it’s that this stuff can’t be left to the free market. Whether or not it should be banks instigating or reacting to change is another question I guess.
To those who may or may not be interested, I tried to reopen a Triodos account to park some funds that I’m “looking after” so to speak (interest free expense) and the experience has not been good!
Stuck in a doom loop with error messages applying from my old profile, I was not advised for two weeks that I needed to follow a different flow. The new application is now stuck in the queue with the rest, but the old profile still seems to be causing issues. I’ve been offered compensation once the account opens.
It’s a shame, perhaps a lesson to leave 1p in case you want to move back, but not a great experience. Why do the majority of non major banks seem to have bottlenecks & issues like this! I’ve left and rejoined high street banks without even a hint of a problem!
Might have to revert to Nationwide for this purpose if they don’t sort this out, as I understand they have fairly decent credentials (so much so the Triodos Bond fund has them in the portfolio) but it’s not on the same level of transparency as Triodos.
it’s not as dodgy as it sounds. Funds set aside for a family member & set aside to pay off some flights on an interest free period. I’m not chasing the best rate so to speak.
