South Africa’s Nedbank will stop financing new thermal coal mines from 2025 and cut direct funding of new oil and gas exploration projects with immediate effect, it said on Thursday amid growing pressure on banks from climate activists.
South Africa’s lenders – some of the biggest banks on the continent – are facing pressure from environmental groups to stop funding fossil-fuel power projects that are seen as a major risk to global plans to tackle climate change.
South Africa, the continent’s biggest greenhouse gas emitter, gets most of its power from coal-fired power stations.
Nedbank, one of the country’s four biggest banks lenders, has made the strongest commitments so far to curb its lending to the coal, oil, and gas sectors.
“Nedbank’s energy policy serves to guide the bank’s transition away from fossil fuels while still providing appropriate support to existing energy requirements,” said Nedbank chief financial officer Mike Davis.
Nedbank also said it aimed to finance local small-scale renewable power generation to the tune of R2 billion ($141 million) above its R50 billion commitment to the country’s renewable energy tendering process.