ING Plans Major Boost in Renewable Energy Finance, Exits Financing of New Oil & Gas Projects
Amsterdam-based global bank ING announced today a new series of sustainable finance commitments, including plans to scale financing of renewable energy and cut fossil fuel finance. ING stated that it aims to grow new renewable energy financing by 50% by the end of 2025, and that it will no longer provide dedicated finance to new oil and gas fields.
According to ING, the new commitments form part of the bank’s ‘Terra approach’ to steer its loan portfolio to align with 1.5°C. Terra assesses the technology shifts needed across various sectors in order to achieve the climate target, relative to the technology used by the bank’s clients currently, setting a direction to apply its financing activities. The approach focuses on several high-emitting sectors, including energy, automotive, shipping & aviation, steel, cement, residential mortgages and commercial real estate, and helps the bank determine if its lending is contributing to climate resilience in these areas.
ING has significantly increased its focus on renewables financing over the past few years, nearly doubling its renewable energy lending since 2016. Renewables now account for around 60% of the bank’s €12.2 billion power generation lending portfolio.
The bank’s new fossil fuel restriction refers to dedicated upstream finance for oil and gas fields approved for development after the end of 2021, while ING will continue to provide financing to clients who are active in keeping oil and gas flowing. According to ING, its energy strategy aims to balance the needs to decarbonise to fight climate change with the needs for energy to remain affordable and for the security of the energy supply.
Michiel de Haan, Head of ING’s Energy Sector, said:
“The best way to reduce dependency on fossil fuels is to make sure there are enough affordable green alternatives available. These steps support that and show we’re serious about putting our financing to work to facilitate the energy transition.”