2025 Fossil Fuel Finance Report Latest News
- The 2025 Fossil Fuel Finance Report by the Banking on Climate Chaos Coalition reveals that the world’s 65 largest banks collectively committed $869 billion to fossil fuel companies in 2024, up from $707 billion in 2023.
- This growth, including the involvement of India’s SBI, has sparked global concerns over climate goals, especially amid policy rollbacks and increasing global temperatures.
Key Highlights of the Report
- Rising fossil fuel financing:
- Global financing surge: In 2024, global fossil fuel financing increased by 22.8% over 2023.
- Top contributor: JPMorgan Chase topped the list, contributing $53.5 billion, a $15 billion increase from 2023.
- SBI’s climate commitments vs actions:
- Commitments:
- State Bank of India (SBI) aims for net zero by 2055.
- Target of 7.5% green advances by 2030 of domestic gross advances.
- As of March 2025, SBI had extended ₹20,558 crore in sustainable finance.
- Actions: The report highlights that SBI’s position rose to 47th rank, with a total fossil fuel financing of $2.62 billion, marking a $65 million increase from 2023.
- Commitments:
Contradictions and Policy Backtracking
- Policy rollbacks in global banks:
- American lender Wells Fargo scrapped plans to become net zero by 2050.
- European banks, earlier seen as climate-progressive, also showed weakening sector policies.
- Six largest US banks exited the UN Net-Zero Banking Alliance.
- US policy shift under Trump administration:
- Withdrawal from Paris Agreement (effective early 2026).
- Exit from the Network for Greening the Financial System.
- Proposed legislation to cut clean energy tax incentives.
- This rollback comes despite 2024 being the hottest year ever recorded.
India’s Coal Financing Blind Spot
- As per Climate Risk Horizons, Indian banks largely lack coal exclusion policies.
- Only Federal Bank and RBL Bank among BSE’s top 1000 banks have such policies.
- Despite renewables now being cheaper than coal, banks continue fossil fuel investments.
Long-Term Concerns
- Lock-in effect of infrastructure:
- As per IEA 2024, achieving net zero by 2050 demands halving fossil fuel investment by 2030.
- New investments risk locking economies into decades of fossil fuel dependency.
- Mergers and acquisitions (M&A) financing:
- Acquisition-related fossil fuel financing rose to $82.9 billion.
- Although not directly creating new infrastructure, such financing strengthens fossil fuel companies’ market dominance, delaying the global phase-out essential for climate mitigation.
Cumulative Trends since Paris Agreement
- From 2016–2025, the 65 banks have contributed $7.9 trillion in fossil fuel financing.
- Since 2021, $3.3 trillion has been lent to fossil fuel businesses — a persistent trend despite global climate urgencies.
Conclusion
- The rise in fossil fuel financing by global and Indian banks in 2024 signals a critical policy regression against the backdrop of an escalating climate crisis.
- While financial institutions proclaim net-zero targets, the widening gap between climate pledges and actual financing behavior underscores the urgent need for enforceable climate-aligned banking regulations.
- This is especially important as time runs out to meet global sustainability commitments.
Source: IE
Last updated on July, 2025
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2025 Fossil Fuel Finance Report FAQs
Q1. What is the significance of the 2025 Fossil Fuel Finance Report in the context of global climate commitments? +
Q2. How has the State Bank of India (SBI) contributed to fossil fuel financing in 2024, and what are its green finance targets?+
Q3. What trends have been observed regarding fossil fuel financing policies among Western banks, especially in the US and Europe?+
Q4. Why is coal financing considered a blind spot for Indian banks?+
Q5. What is the potential impact of mergers and acquisitions financing in the fossil fuel sector? +
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