Deutsche Bank slashing oil and gas loan issuance | Rigzone


Deutsche Bank AG has given its clearest indication yet of how it plans to deliver on the pledge it made last year to achieve net-zero funded emissions by 2050.

Germany’s largest bank said in a statement on Friday that it would “significantly” reduce its so-called scope 3 emissions, also known as funded emissions, by 2030 and announced a set of emissions reduction targets. for its 250 billion euro ($244 billion) business lending book. The bank said it “aims to support an orderly phase-out of fossil fuel use while encouraging the financing of low-carbon technologies and customers with credible transition plans.”

In the oil and gas sector, Deutsche Bank said it forecast a 23% reduction in funded emissions by 2030 and a 90% decrease by 2050. The bank said in March that loans Oil and gas are the largest component of its funded emissions, accounting for 32% of the total, or 9.7 million tonnes of CO2 equivalent per year.

Banks that have made high-level commitments to phase out emissions are under increasing pressure to provide evidence of how they plan to meet their targets. Meanwhile, Vladimir Putin’s war in Ukraine and a global energy crisis are leading some banks to reconsider their climate commitments. In March, the European Central Bank said it was pushing lenders to disclose more information about the climate and environmental risks they face after finding that only 15% publish data on the emissions they finance.

Deutsche Bank is a founding member of the Net-Zero Banking Alliance and is therefore required to detail how it will reduce emissions in the most carbon-intensive industries on its balance sheet.

The German bank also said Friday that in the power generation sector, it is targeting a 69% reduction in physical Scope 1 emissions intensity by 2030; in the automotive industry, it predicts a 59% reduction in exhaust emissions intensity by 2030; and in steel lending, the bank is targeting a 33% decline in physical Scope 1 and 2 emissions intensity by 2030. The bank said it aims to achieve these targets by advising clients in carbon-intensive industries and funding their transition strategies and efforts on their way to net zero emissions by 2050.

“This is a big step forward in actively managing the carbon footprint of our loan portfolio,” said sustainability director Jörg Eigendorf in the statement. “We are focused on supporting our clients on their net zero journey. It is a crucial element of our sustainable development strategy.

Deutsche Bank’s target for oil and gas is based on absolute emissions, while its targets for other sectors are based on carbon intensity, which measures emissions per unit of output. Climate campaigners have said the intensity targets are a “cheap accounting trick” because they allow banks to continue financing the expansion of fossil fuels instead of pushing for their elimination.

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