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Equipment Finance Sponsored by Equipment Finance News BNP Paribas embarks on a new phase of rapid acceleration in energy transition Published: 27th January 2023 Share Building on expertise developed within its Low-Carbon Transition Group, BNP Paribas is embarking on a new phase designed to rapidly accelerate the transition to a low carbon economy. The new phase is looking to achieve a target of €40 billion in outstanding financing for the production of low-carbon, primarily renewable, energies by 2030 and reducing outstanding financing for oil extraction and production to less than €1 billion by 2030, which represents a decrease of more than 80% compared to the current balance of €5 billion; to be achieved through scheduled phasing out the financing of specialised and associated activities in the sector. BNP Paribas will also focus financing in the gas sector on new generation, low-emission thermal power plants as well as supply security, gas terminals and gas transportation fleets. Outstanding financing for gas extraction and production will thus be reduced by more than 30% by 2030. This new phase is set to last until 2030, by which time BNP Paribas will have completed transitioning over 80% of its energy production financing activities to the production of low-carbon energies. Jean Laurent Bonnafé, Chief Executive Officer of BNP Paribas said, “In 2015, when the Paris agreement was signed, financing for the production of low-carbon energy only accounted for a limited part of BNP Paribas’ loan portfolio dedicated to energy production. By 2030, it will represent nearly four-fifths of this loan portfolio. The Group will have achieved 80% of its transition in less than 15 years, confirming its position as the leader among international financing actors.” BNP Paribas has already made a major pivot towards financing low-carbon energy production: BNP Paribas’ outstanding loans for low-carbon energy production were at more than 28 billion euros at the end of September 2022, already close to 20% higher than those for fossil fuel production. The Group has secured a leading global position in green bond structuring and placement in 2022, equivalent to $19.5 billion. An exit path from oil underway: BNP Paribas stopped oil project financing in 2016; a commitment has been made to reduce outstanding financing for oil extraction and production by 25% by 2025. A coal exit is already well underway, which will be completed by 2030 in OECD member states. Lisa Laverick Editor - Asset Finance Connect Sign up to our newsletter Featured Stories NewsEvolving roles of banks and independents in US Corporate Member NewsAssociated Asphalt secures funding from Paragon Bank NewsDutch leasing market sees robust growth in H1 2024 Equipment Finance