Finance, both as equity – shares in companies – and debt – loans to companies or specfic projects – is a fundamental part of the Carbon Web of institutions that support the international fossil fuel industry. A shift away from fossil fuels will require a redirection of the flows of capital. The extraction of oil, gas and coal is driven less by the direct needs of human and social development than by the desire to generate high returns on invested capital. Platform works to redirect this flow via both debt and equity finance in two key projects.
The tar sands are described as an ‘unconventional’ resource because massive inputs of energy and machinery create carbon dioxide emissions several times those of ‘conventional’ fuel. Tar sands extraction in Canada threatens the livelihoods of First Nations communities through the destruction of forests and the pollution of rivers. International oil companies were long reluctant to invest in ‘unconventional’ fuels, mainly because of the high production costs, but reduced access to ‘conventional’ oil has led Shell to hold 30% of its reserves in tar sands, and BP to push forward with its investments despite strong oppostion. Platform is in constant dialogue with institutional investors about the systemic risks in the oil and gas sector as well as in specific projects and oil provinces.
UK high-street banks
UK banks rank highly in global investments in oil, gas and coal projects. The Royal Bank of Scotland has over the past ten years financed more of the sector than any other UK bank, and its risk asset portfolio has carbon emissions embedded in it that are greater than those of the country of Scotland. Platform has led research on the bank’s activities and worked to support groups of students, campaigners and taxpayers to hold RBS accountable and push it to change its lending policy and behaviour.