Fossil fuels are the primary cause of climate change, which threatens catastrophic damages including massive sea-level rise, rising incidences of flood, drought and other extreme events, major water and food supply reductions, and the spread of disease.

PLATFORMs Unraveling the Carbon Web focus is to reduce the environmental and social impacts of oil and to support the transition to a more sustainable energy economy. We recently posted on a new report, Cashing in on Coal, that Unraveling the Carbon Web released and caught up with Kevin Smith of Platform to learn more.

What does Cashing in on Coal highlight?

The report highlights the role that private finance plays in pushing forward the fossil fuel frontier. As the extraction costs of the fossil fuel industry increase, companies are turning to private banks to provide the extra capital that they need. It follows on from a report that we published last year called “The Oil and Gas Bank” that you can download here that highlighted the fact that RBS, more than any other bank was heavily involved in expanding oil and gas operations around the world. This new report took a similar approach to RBS’ involvement in financing the coal industry.

Banks like RBS can claim that they are being good corporate citizens by capping and reducing the internal emissions of their operations, but the reality is that an estimated 99% of their operating emissions are embedded in the projects that they finance. We are calling on banks to make a full disclosure as to which fossil fuel projects they are funding, recognize some degree of responsibility for the money they put into those projects, and cap and decrease the emissions embedded in their investment portfolios.

People across the UK came to protest against the proposed new coal fired plant in Kingsnorth last week at the Camp for Climate Action. What many of them might not have realised, is that the money in their RBS or Natwest bank accounts is very possibly being used to finance the wave of new coal-fried plants that E.ON is planning on.

Beyond the global impacts of fossil fuels, what are some of the local, national, and regional impacts?

Like most extractive industries, the fossil fuel industry is often responsible for very negative social and environmental impacts on local communities. One of the companies being funded by RBS, Arch Coal which uses the controversial coal mining practice called Mountain Top Removal. This destroys the tops of entire mountains and produces large quantities of toxic sludge. Arch Coal alone has been responsible for the disappearance of 300,800 acres of biologically diverse hardwood forest through this practice.

We keep hearing the phrase energy security in the news… What does it really mean?

Energy Security is constantly being bandied about as a justification for building new coal plants in the UK, ie that we need new coal in order to ‘keep the lights on’. However a recent report by energy consultancy Poyry (along with Greenpeace and WWF) showed that it was entirely possible to meet energy demand in this country through increased deployment of renewables and increasing energy efficiency without resorting to new coal.

We need to have a rational perspective on energy security that does not allow it to be used as a trump card on climate security. Making sensible decisions now about promoting renewables instead of fossil fuels (not alongside them) will ensure that we can enjoy energy security for a long time into the future rather than the prevalent attitude of consuming as much fossil fuels as we can, while we can.

Can you tell us about Banktrack?

BankTrack is a network of civil society organisations and individuals tracking the operations of the private financial sector (commercial banks, investors, insurance companies, pension funds) and its effect on people and the planet.

In December 2007 BankTrack released Mind the Gap. The report reviewed the environmental and social credit policies of 45 banks that you can download from here.

What role do you see the carbon market playing in helping to transition to a sustainable energy economy?

I’m not at all convinced that the carbon market is an appropriate tool to make the transition to a sustainable energy economy. Right now, a number of power companies are using the carbon market as a justification for developing new fossil-fuel intensive infrastructure. From E.ON’s proposed new coal plants, to the extraction of tar sands in Canada, fossil fuel companies are using cap and trade schemes and offsets as a means to continue their destructive practices. And the world over, the carbon financing involved in the CDM appears to be going to the owners of polluting industries rather than ushering in clean energy.

What most excites you right now about the changes were seeing in the world?

I find the idea of people getting impatient with government inaction on climate change and starting to make the changes for themselves in their own communities very exciting. I find the idea of fossil fuel companies losing their cultural legitimacy in the same way that tobacco companies did exciting. I find it exciting that there is a greater awareness of the impossibility of maintaining perpetual economic growth in a world of finite resources.