Dutch banking giant ING on Wednesday said it will stop financing oil and gas exploration and production projects by 2040 and triple its backing of renewable energy over the next two years.
ING confirmed to Upstream’s sister publication Recharge that the bank currently has a €4 billion ($4.4 billion) upstream oil and gas portfolio.
The bank said it will speed up phasing out the financing of upstream (exploration and production) oil and gas activities in line with guidance from the International Energy Agency.
It will cut loans to upstream activities by 35% by 2030, before ending them entirely by the following decade.
ING’s move to stop financing upstream oil and gas projects by 2040 and increase its renewables backing is good but not good enough, said environmental campaigners, who accused the Dutch banking giant of continuing to “fan the flames” of the climate crisis in the meantime.
ING said it had taken the decision after world leaders at the COP28 climate summit in Dubai agreed this month to transition away from fossil fuels, while tripling global green energy capacity by 2030.
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It will continue to fund midstream and downstream projects, which refer to oil and gas transportation and conversion into fuels, with its current portfolio in those areas standing around €10 billion.
ING chief executive Steven van Rijswijk said the move builds on the progress made by world leaders at COP28 as well as the latest scientific research.
‘Our planet is on fire’
Environmental group Greenpeace responded to the announcement by claiming the move away from fossil fuels finance is too slow.
“It is great that ING confirms the agreements from Dubai,” said Maarten de Zeeuw, a climate expert at Greenpeace’s Dutch branch.
But while this is a “step in the right direction,” de Zeeuw said that “our planet is on fire.”
“Let’s face it: just stepping away from the fire isn’t enough, as long as you keep fanning the flames in the meantime.
“ING continues to finance companies drilling for new oil and gas. And while the science is clear: to achieve the target of 1.5 degrees (Celsius in maximum global warming compared to pre-industrial temperatures), there is no longer room for fossil projects.”
ING for its part stressed that the energy transition “cannot happen overnight,” so even though it finances “a lot of sustainable activities, we still finance more that’s not.”
“That is a reflection of the current global economy, how far the world has come and still needs to go.”
(This story was first published on Upstream’s sister publication Recharge.)