Facing intense pressure from climate campaigners, the United States’ biggest bank, JP Morgan Chase, is making some tentative moves to scale back its investments in coal and eliminate new financing for Arctic oil and gas projects.
JPMorgan Chase announced this week that it “will no longer advise or lend to companies that get the majority of their revenue from the extraction of coal, and that it will exit existing credit exposure to those companies by 2024,” Bloomberg reports. “It also vowed to stop financing coal-fired power plants unless they’re using carbon capture and sequestration technology, and said it won’t provide project financing for new oil and gas developments in the Arctic.”
The policy “tweaks”, as Bloomberg styles them, are meant to support “market demand for and transition to cleaner sources of energy,” the bank said in a statement ahead of its annual investor day.
Last month, the bank’s analysts cited climate change as a threat to “human life as we know it”, a year after they warned the climate crisis will be more expensive to address if action is delayed.
“The response to climate change should be motivated not only by central estimates of outcomes but also by the likelihood of extreme events,” economists David Mackie and Jessica Murray wrote in a report to clients January 14. “We cannot rule out catastrophic outcomes where human life as we know it is threatened.”
The bank calculated that “business-as-usual” average global warming of 3.5°C would reduce global GDP by 7.2%, but acknowledged that figure was likely “far too small,” explaining that “economic models struggle to deal with low-probability events that could prove catastrophic.”