Japan’s largest banks and its authorities are on the forefront of bankrolling fossil gas growth in Southeast Asia, a brand new report by the Banking on Local weather Chaos (BOCC) Coalition discovered.
Sumitomo Mitsui Banking Company (SMBC), Mitsui UFJ Monetary Group (MUFG) and Mizuho Financial institution had been listed as the highest financiers of methane gasoline energy growth in Southeast Asia, the report mentioned, backing extremely deepwater oil and gasoline.
Mizuho alone, which was ranked because the second largest financier of fossil fuels globally after American financial institution JP Morgan Chase, elevated its financing from US$35.4 billion in 2022 to US$37 billion in 2023.
In the meantime, MUFG, which financed probably the most fossil fuels of all of the Japanese banks since 2016, following the Paris Settlement signed in December 2015, had additionally elevated its funding for fossil fuels in 2023 to US$33.25 billion.
State-backed Japan Financial institution for Worldwide Cooperation has channelled US$7 billion from public funds to Southeast Asia’s methane gasoline trade since 2016, which accounted for 47 per cent of all public finance for the area’s gasoline sector.
“Consequently, the Japanese authorities is the most important financier of the methane gasoline trade in Southeast Asia,” mentioned the report, drawing on findings from the Middle for Vitality, Ecology and Growth.
A latest report by the suppose tank Institute of Vitality Economics and Monetary Evaluation (IEEFA) confirmed that Japan’s curiosity in cultivating Southeast Asian demand for gasoline is the results of surplus LNG volumes the nation is seeking to offload.
Based on the BOCC report, Thailand was among the many largest recipients of fossil gas financing within the area. The nation has added probably the most liquified pure gasoline (LNG) capability within the area since 2016 and in 2022, Thailand was the most important importer of LNG from prime world exporters, together with neighbouring Malaysia. LNG is virtually fully made up of methane gasoline.
“Coal just isn’t referred to as ‘pure’ rock. It’s a fossil gas. Likewise, there isn’t any such factor as ‘pure’ gasoline. It’s methane, and it’s a fossil gas,” the report mentioned.
Vietnam and the Philippines are additionally set to grow to be main patrons of LNG after each international locations formally started importing methane gasoline in 2023, having commissioned their first LNG import terminals and acquired deliveries final 12 months. Each international locations mixed comprise about 63 per cent of the gasoline energy plant and import capability within the area, the report mentioned.
In the meantime, Malaysia and Indonesia are among the many world’s largest exporters of methane, accounting for about 10 per cent of world methane exports and planning so as to add 13.5 million tonnes each year of recent export capability.
The report additionally highlighted the Philippines’ San Miguel Company’s growth of fossil fuels, together with coal and gasoline energy crops. The conglomerate is behind the most important deliberate capability growth of fossil gasoline in Southeast Asia, together with a landmark US$3.3 billion deal for the development of an LNG facility within the biodiverse Verde Island Passage. Native communities have protested in opposition to the undertaking.
Not a bridge gas
The BOCC report, now in its fifteenth version, ranked the world’s prime 60 banks lending and underwriting finance to over 4,200 fossil gas corporations globally. The information accounts for every financial institution making monetary contributions to fossil gas offers, along with banks in main roles.
Altogether, the highest 60 banks listed pumped US$705 billion into fossil fuels in 2023, including to a complete of US$6.9 trillion since 2016. Practically half of this went in direction of fossil gas growth. Citibank was named the largest funder of fossil gas growth since 2016.
Singapore’s DBS Financial institution was a brand new addition to the checklist this 12 months, having poured a cumulative US$36.8 billion in gasoline and coal growth between 2016 and 2023.
The report discovered that a few of Southeast Asia’s largest fossil gas financiers come from traditionally carbon-polluting nations, corresponding to america, Europe and Japan. Between 2021 and 2023, the banks within the report channelled US$27.6 billion into 15 corporations which had been increasing LNG commerce within the area with 100.1 million tonnes each year of methane gasoline terminal growth plans.
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Coal just isn’t referred to as “pure” rock. It’s a fossil gas. Likewise, there isn’t any such factor as “pure” gasoline. It’s methane, and it’s a fossil gas.
Banking on Local weather Chaos Coalition
Over the identical interval, these banks additionally poured US$39 billion into the methane gas-fired growth plans of 40 corporations in Southeast Asia, which had deliberate 105 gigawatts (GW) of gas-fired growth worldwide.
“These financiers are enabled by insurance policies that falsely tout methane gasoline as a bridge gas and encourage the sector by offering public finance,” the report mentioned.
The area additionally acquired fossil gas financing from multilateral improvement banks, particularly the Asian Growth Financial institution and the World Financial institution, which had channelled US$1.2 billion into fossil fuels since 2016.
On the brilliant aspect, these identical financiers are additionally backing renewable vitality improvement throughout the area, the report mentioned. “Even with 139 GW of recent methane gasoline capability within the pipeline… renewable vitality development quantities to 328 GW, greater than twice as a lot because the proposed methane gasoline capability,” it mentioned.
