London – The European Bank for Reconstruction and Development (EBRD) will cease investing in upstream oil and gas projects by the end of 2022 as part of its plan to align its operations with the Paris Agreement’s climate change targets.
During a meeting commemorating the Paris accord’s 30th anniversary, the lender’s board of governors accepted the move to align with it. According to Reuters, EBRD Managing Director Harry Boyd-Carpenter, this means the bank will stop investing in oil and gas exploration and production.
The news follows the lender’s vow last year to increase the share of green investments in its investment activities to more than 50% by 2025.
The EBRD stated that it would review projects and ensure they were consistent with long-term progress toward low-carbon development using a methodology established in collaboration with other multilateral development banks.
The EBRD countries have a carbon footprint that is 35% greater than the global average, and highly polluting coal accounts for more than 40% of primary energy supply in seven of the countries, according to the bank. The lender will expand its renewable energy lending.