Commercial, Finance - March 24, 2022
ING Increases Financing of Renewable Energy
ING announced it will increase new financing of renewable energy by 50% by year-end 2025, and no longer provide dedicated financing to new oil and gas fields.
In financing the global energy system, the investment bank differentiates between power generation and the production and processing of fossil fuels. Power generation refers to the actual way energy is used to make electricity. The source of energy used (renewables, oil, gas, coal) is relevant to understanding how the power generated impacts the climate.
ING has made good progress in its power generation sector financing and does not finance any power generation from oil and stopped new financing to coal-fired power generation in 2015 and pledged in 2017 to exit coal-fired power plants by 2025. The bank does finance power generation from natural gas, which is the least-damaging fossil fuel. The majority of its financing in the power generation sector goes to renewables like wind and solar power.
“The best way to reduce dependency on fossil fuels is to make sure there are enough affordable green alternatives available,” said Michiel de Haan, head of ING’s energy sector in a statement. “These steps support that and show we’re serious about putting our financing to work to facilitate the energy transition.”
Even in a net-zero world, there will still be a need for oil and gas. ING will continue to support that while increasing investments in renewables and gradually reducing funding to upstream oil and gas by 12% by 2025 and 19% by 2030. This puts the company on track for minus 53% by 2040, in line with the IEA’s net-zero by 2050 roadmap.
ING will continue financing energy from solar and wind power and also support technology innovation in advanced batteries, hydrogen and carbon capture, and storage and aims to increase lending to renewables by 10% per year, every year until 2025. Over the last five years, ING’s exposure in renewables has more than doubled and now makes up 60% of our power generation portfolio.
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