ING’s new policy includes two key points: for the first time, ING is ending the financing for a small group of fossil-based companies, and the bank is finally acknowledging that it should stop financing liquefied gas plants. These are exactly the things we have demanded from the start, and which ING has never done – until now. As such, the journey to a fossil-free ING has begun. However, with billions still invested into fossil fuels, the bank is only at the beginning of this path. Let’s take a deeper dive into the steps that ING is taking, and where the problems lie.
Step 1: ING stops funding liquid gas (a little bit)
Here’s what it entails:
The biggest step ING is taking is: excluding project financing for (the expansion of) LNG export terminals from 2026. That’s quite a mouthful. In recent years, ING has been one of the largest financiers of liquefied gas plants (LNG export terminals) around the world but especially in the US. In these plants, gas is liquefied by making it extremely cold so that it takes up less space and can be shipped around the world in large tankers. Liquefied gas is often even more harmful than coal and causes serious health damage to local residents. By terminating this funding, ING admits that these ‘new’ gas plants are exacerbating the climate crisis.
Here’s what we are happy about:
ING is the first bank in the world to limit the financing of these plants. This is a victory for local residents, for a fossil free ING and for the Dutch climate movement. Our actions are working. There has also been positive attention abroad for ING’s decision.
Here’s what we don’t like:
The well-known snake in the grass? ING is not going to do any of this until 2026. As a result, they have plenty of time to fund these factories until next year – and there are, of course, plenty of fossil projects lined up looking for money.
This needs to be expanded:
The move is specifically limited to liquefied gas projects. The companies behind these projects can still turn to ING for general funding after 2026 (for money not used for one specific project). This is a convenient and well-known shortcut for fossil companies to free up financing for their oil and gas infrastructure.
Of course, it remains to be seen how the policy will eventually be worked out, but as it stands, the maths goes like this: of the 8 billion euros of ING’s current liquefied gas portfolio, only 3 billion will actually stop. The conclusion? ING will continue to cash in on liquefied gas, one of the most profitable fossil sources, at the expense of people and the climate.
Step 2:ING will stop funding companies that gain all their revenue from oil and gas extraction
Here’s what it entails:
The second and smaller step is for ING to exclude companies that derive (almost) all their income from oil and gas extraction, so-called ‘pure play companies’. This applies to project finance as well as general loans and bonds. This sounds very good, especially since ING has, up till now, always denied that they should stop doing this.
Here’s what we are happy about:
This step is small, but it’s better than nothing. The fact that ING is now excluding general loans and bonds for certain fossil companies for the first time means that the pressure on all fossil companies is increasing. Hopefully, the same rules will soon apply to them too. Moreover, among the ‘pure players’, there are companies that are causing massive damage. Santos, for example, is one such company working on carbon bomb projects in Australia and the Pacific Islands.
Here’s what we don’t like:
The companies that focus entirely on oil and gas extraction are (relatively) small and few in number. A fossil giant like BP, which is involved in much more oil and gas extraction than smaller companies, can still borrow money from ING. This is because BP also has other activities such as transportation and storage, so they do not directly derive their biggest revenues from oil and gas extraction. Therefore, they are not officially a ‘pure play company’. So it remains to be seen how big the impact will be to only stop the funding for the small, ‘pure play’ companies. Especially as ING does not have a definition for what constitutes a ‘pure play’ company.
This needs to be expanded:
The new policy should go much further. All companies that remain committed to oil and gas extraction, including fossil giants like BP and Exxon, should be excluded. ING says it doesn’t want to stop financing even these ‘upstream’ projects until 2040. But that is far too late: there is no more room for new oil and gas extraction. But with these financings, ING will continue to facilitate oil and gas drilling projects for decades to come.
What else is missing from ING’s new climate policy?
The fossil industry is also supported by numerous midstream projects; these are responsible for transport and storage facilities like LNG terminals, pipelines, etc. For companies building midstream fossil infrastructure, no end date whatsoever has been announced. ING should stop all financing (project financing, general loans and bonds) of midstream companies, not just liquefied gas companies, now.
Finally, ING should not only stop financing fossil companies, they should also invest much more in renewable energy. Currently, of every euro they lend to energy companies, only 25 cents goes to renewable energy: the rest goes to fossil. According to international targets, this should be 6 euros for every euro that goes to fossil. This means that they still have a long way to go.
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