Barclays is assembling a new Energy Transition Team to try and quell the massive pressure it’s facing to end the billions of dollars it’s providing to the likes of Shell and Exxon.
There’s good news and bad news to this announcement.
First, the good news:
The team will be finding opportunities to finance green businesses. This is timely and very profitable as the world looks to leave fossil fuels behind. It’s also incredibly needed – whilst there are powerful technical solutions for helping to take on the climate crisis, there’s a massive dearth of financing to scale up and distribute those solutions. Barclays is already providing some funding to green energy, but according to BloombergNEF, it needs to be at nearly 3x it’s current financing to be actively funding the transition in any real way. The new Energy Transition team will be tasked with kick-starting that.
But then, the bad news:
What Barclays is counting as “green”, isn’t really green. In a statement to Bloomberg, Barclays specifically mentions working on carbon capture and “renewable natural gas”. Carbon capture is widely being held up by the fossil fuel industry as the technology that will let them continue business as usual. However it’s widely derided as a currently pie in the sky technology that is completely unproven at any meaningful scale. As for “renewable natural gas”, there is no such thing. Gas is a damaging fossil fuel which the International Energy Agency are very clear about – it’s extraction cannot continue if we want a safe world. Putting the word “natural” in front of it doesn’t make it good.
The second bit of bad news is that this team will be working to help the world’s most damaging fossil fuel companies to “transition”. The clue is in the name – the fossil fuel industry is based entirely on the extraction and use of fossil fuels. They are throwing every spanner in the works to slow and stop any hope of transitioning away from fossil fuels. They’re even rowing back on their already weak climate pledges – this is despite Barclays saying for the last 5 years that they’ve been working with the fossil fuel companies to help them change. And yet, Barclays are continuing to lend them billions of dollars. A new team to try and transition companies that are refusing to transition will not make a difference, history is proof of that.
NEW: @Barclays is just shuffling staff around to pretend it’s financing the transition
It’s unconditionally ploughing billions into companies like Exxon and Shell which are aggressively expanding oil drilling & doing next to nothing on green https://t.co/U7Nn8gcz45
— Bank On Our Future (@bankonourfuture) January 11, 2024
So is this a good thing or a bad thing?
It’s both. It’s a good thing for green investment and Barclays taking a further step into that world. It’s bad thing for the continued rampage of fossil fuel companies on everything we hold dear. Having a new transition team and giving millions to transition funding doesn’t take away from the billions that Barclays is stuffing into the pockets of the world’s worst fossil fuel companies. Until Barclays stops bankrolling Shell, Exxon and the other fossil fuel companies refusing to transition, it is on the side of destruction, not leadership.