Bank announces decarbonization initiative
Barclays recently published a revised "Climate Change Statement" which it said will "progress its climate strategy and continues its focus on clients actively engaged in the energy transition."
Following Barclays’ commitment to finance $1 trillion of Sustainable and Transition Finance by 2030, the company also released a Transition Finance Framework to support meeting that target and facilitate the transition finance needed to decarbonize high-emitting sectors.
The updated Climate Change Statement outlines:
No project finance, or other direct finance to energy clients, for upstream oil and gas expansion projects or related infrastructure.
Restrictions for new energy clients engaged in expansion.
Restrictions on non-diversified energy clients engaged in long lead expansion.
Additional restrictions on unconventional oil and gas, including Amazon and extra heavy oil.
Requirements for energy clients to have 2030 methane reduction targets, a commitment to end all routine / non-essential venting and flaring by 2030 and near-term net zero aligned Scope 1 and 2 targets by January 2026.
Expectation for energy clients to produce transition plans or decarbonization strategies by January 2025.
In the International Energy Agency NZE scenario, new long lead time upstream oil and gas projects are not required on a 1.5°C-aligned pathway. For current and future (declining) global demand to be satisfied, investment is needed to support existing assets while clean energy is scaled.
"Barclays will continue to support an energy sector in transition, focusing on the diversified energy companies investing in low carbon and with greater scrutiny on those engaged in developing new oil and gas projects."