Today Citigroup launched its initial roadmap to achieve net-zero in its energy and power portfolios. With these targets, Citigroup becomes the first major US bank to set an absolute emissions target for its energy portfolio.
Climate advocates have repeatedly criticized other banks' intensity-only targets, which are compatible with increases in absolute emissions.
However, the policy still allows their biggest fossil fuel clients such as Exxon, Saudi Aramco, and Chevron to lag in 2022 and 2023-leaving just six years for the company to slash its financed emissions by 2030.
"Citi's new climate plan is a small step forward, but there is much more to be done," said Jackie Fielder, Stop the Money Pipeline Coalition Co-Director. "Failure to immediately end the bank's support for fossil fuel companies that are ignoring climate science and expanding their operations is the most glaring gap. As the second-largest funder of the fossil fuel industry since the Paris Agreement was signed in 2015, it is a gap that Citi should fill without delay."
The unprecedented: Citigroup's climate plan uses absolute emissions rather than carbon intensity metrics to judge progress in the energy sector. By measuring financed (absolute) emissions to measure its progress in its energy portfolio, Citi breaks rank with three other major US banks (JP Morgan Chase, Goldman Sachs, and Morgan Stanley) that have used carbon intensity metrics in their 2030 net zero plans. The carbon intensity metric is a cheap accounting trick that enables banks to appear as if they are decarbonizing, even as they continue to expand their support of the fossil fuel industry and corporations driving deforestation around the globe. Additionally, Citi is the first US bank to publish its baseline energy sector financed emissions in absolute terms, broken down by scope.
However, the plan still allows for fossil fuel expansion, in direct contrast to the International Energy Agency's assessment. Last year, the International Energy Agency's special report, Net Zero by 2050, concluded that there must be "no investment in new fossil fuel supply projects" starting from 2021 if the world is to avert catastrophic climate change. Instead, Citi's 2030 climate goals include a two year grace period of engaging with their biggest fossil fuel clients to assess their alignment with net zero. Citigroup says:
We will also encourage the responsible retirement of carbon-intensive assets rather than divestment as part of these transition plans. We will continue to assess our client relationships -- a regular part of how we manage our business -- and prioritize partnering on transition strategies before turning to client exits as a last resort.
Stop the Money Pipeline coalition maintains its demand of an immediate start to a fossil fuel financing phaseout, including our demand of Citigroup to stop financing fossil fuel companies that have plans to expand their operations.
SEE THE DATA: Check out the Global Oil & Gas Exit List (GOGEL), an extensive public database that enables users to readily identify the largest oil and gas expansion companies, as well as those which are responsible for the dirtiest and most controversial forms of oil and gas production.
Member organizations of the Stop the Money Pipeline coalition released the following statements in reaction to the news:
"With these new commitments, Citigroup has surpassed the low bar set so far by its peers and taken an important first step toward aligning its lending practices with a climate-stable future," said Sierra Club Fossil-Free Finance Campaign Manager Ben Cushing. "The targets Citi has laid out aren't achievable if it continues to fund the expansion of fossil fuel development, and we are hopeful that this assessment period over the next two years will lead to cutting ties with polluters that are failing to change their practices accordingly."
"While an absolute target for energy represents a step forward, Citi has not ruled out expansion of fossil fuels -- sidestepping the headline requirement of the IEA net-zero scenario that Citi's energy target is based on," said Rainforest Action Network Climate and Energy Senior Campaigner Jason Opena Disterhoft. "The bank should require companies to end fossil fuel expansion and deforestation as explicit criteria in its client assessment, in line with climate science. This should also apply to power, where an intensity-only target leaves the door open for new fossil gas -- when the IEA has underlined the need for decarbonized power by 2035 in the rich world and 2040 worldwide."
"While it's great that Citi is breaking rank with other fossil fuel funding giants by setting absolute emissions targets for its portfolio, they simply cannot continue to allow fossil fuel expansion," said Amy Gray, Senior Climate Finance Strategist at Stand.earth. "Our planet just cannot afford anymore stalling tactics, frontline communities just can't wait for these banks to appease the fossil fuel industry while our homes burn and flood, while our bodies are polluted and our children's futures are destroyed for profit. It's time to set the standard for the banking industry and Citi should step up to the plate and lead the way."
"Citi cannot call itself a climate leader as it continues to pour financing into oil and gas expansion projects in critical biomes like the Amazon," said Pendle Marshall-Hallmark, Climate and Finance Campaigner at Amazon Watch, "Without a clear commitment to end financing for fossil fuels, Citi's new targets fall short. If Citi is serious about aligning its portfolio with its stated values, it must commit to end fossil fuel expansion immediately, in line with IPCC and IEA science."
"With these new 'targets,' Citi is likely expecting praise from the environmental community, but we can't praise any plan that still allows for funding fossil fuel expansion," said Erika Thi Patterson, Campaign Director for Climate and Environmental Justice with the Action Center on Race and the Economy. "Citi is straight up ignoring the demands of frontline Black, Brown and Indigenous communities that have been targeted by fossil fuel corporations for generations to end the fossil fuel era. We need to see Citi align its commitments with the demands of frontline communities by ending fossil fuel expansion immediately."
