Banks across the globe, specifically from the United States, Europe, and China, have recently made significant investments in projects that are exacerbating the climate crisis. These investments, totaling over $150 billion, have been directed towards large-scale fossil fuel initiatives colloquially termed as “carbon bomb” projects. These projects have a destructive potential as they are capable of releasing over one gigaton of CO2 emissions throughout their lifespan.
From 2016 to 2022, these financial institutions collectively funded these environmentally destructive projects with a staggering $1.8 trillion. These carbon bomb projects are not scarce or minor in their impact. Currently, there are approximately 425 of these projects, all of which have the potential to surpass the world’s remaining carbon budget. This budget was outlined in the Paris Agreement, an international treaty focused on mitigating the impacts of climate change.
Examples of these carbon bomb projects include the Ghawar Field in Saudi Arabia, the world’s largest onshore oil field, and the proposed Tavan Tolgoi Coal Mine in Mongolia. Both of these projects are significant contributors to CO2 emissions. In total, these carbon bombs encompass around 425 extraction projects, containing enough coal, oil, and gas to exceed the world’s carbon budget four times over.
Despite the harmful environmental impact of these projects, they continue to receive substantial financial support. Banks across the globe have overlooked the environmental risks in favor of potential financial return, funding these initiatives and contributing to their continuation.
The potential global impacts of exceeding the carbon budget are not to be taken lightly. The consequences could be catastrophic, including further planetary heating, an increase in extreme weather conditions, and severe threats to both human and non-human life. As the world grapples with the urgency of the climate crisis, the continued financial support of these carbon bomb projects by banks paints a grim picture for the future of our planet.
