- To cut oil & gas loan emissions by 30% by 2030
- Exposure to auto sector emissions to be halved over the period
- NGO calls for the bank to stop funding new oil projects
French lender Credit Agricole (CAGR.PA) on June 22 submitted targets to reduce its exposure to the financing emissions from the oil and gas sector and increase renewable lending.
The move comes as the sector encounters mounting regulatory and investor pressure to align lending with the world’s climate goal, intending to control global warming at 1.5 degrees Celsius over the pre-industrial average by 2050.
In a strategy update, Credit Agricole, the country’s second-largest listed lender, said it hoped that emissions connected to its loans to the oil and gas sector to drop 30% by 2030, while those linked to lending to the autos sector would drop by 50%.
By the end of the year, the bank said it would report decarbonization pathways for other energy-intensive sectors including cement, power, steel, shipping, and commercial real estate. Those for agriculture, residential, and aviation would follow in 2023, overall covering 60% of the bank’s credit exposure.
In addition, the bank said it wanted to invest more in renewable energy, expanding its portfolio of loans by 65 percent by 2025 to get to 14 Gigawatts, equal to the average energy needs of about 5 million households.
While supporting the move to establish targets for the two sectors, an essential of Credit Agricole’s membership of the Net-Zero Banking Alliance – a consortium of banks pledging climate action – non-profit Reclaim Finance said more action was required. Director Lucie Pinson stated:
“We welcome Credit Agricole’s announcement which acknowledges for the first time the need to phase out oil and gas and to complement their 2030 decarbonization targets with measures to immediately reduce emissions in the real world.”
“We call on Credit Agricole to cement this ambition by becoming the first French bank, as it was on coal, to end direct and indirect support for new oil and gas fields.”