Banks Back Away from Financing Mountain Top Removal
For years, shareowner activists have sought to engage financial institutions over financing of the environmentally destructive practice of mountain top removal (MTR).
MTR coal mining, practiced most often in the Appalachian region, involves extensive deforestation. Then, according to As You Sow, "Coal mining operations will literally blast away mountain tops to expose coal beds. This is followed by the dumping of tons of rubble into the valleys below which fills streams and destroys water resources."
As far back as 2007, Trillium Asset Management filed a shareowner resolution with Bank of America, requesting that the bank "amend its greenhouse gas (GHG) policies to observe a moratorium on all financing, investment, and further involvement in activities that support MTR coal mining."
And in 2010, Boston Common Asset Management filed a resolution with JPMorgan Chase, requesting that the company report on the environmental and financial impacts of the MTR projects it finances. "Over the past 17 years, JPMorgan Chase has helped to underwrite nearly 20 bond or loan deals, worth a combined $8.5 billion, for some of the biggest players in the MTR mining business," according to an article published by Mother Jones in March.
Citing progress in its engagement with JPMorgan Chase, Boston Common withdrew its resolution this year.
It now seems that the concerns voiced for years by shareowner activists and environmentalists over MTR have found support within government agencies. In June, the U.S. Army Corps of Engineers announced it would no longer use a fast-track permitting process for MTR mining, and in August the Environmental Protection Agency (EPA) introduced new water quality standards. In announcing the new standards, Lisa Jackson, EPA Administrator, pointed to "a growing body of science demonstrating that devastation of ecosystems in Appalachian states is being caused by mountaintop mining."
Also, the Rainforest Action Network reported last month that "Bank of America, Citi, Morgan Stanley, Credit Suisse, JPMorgan Chase, and Wells Fargo have successively passed public policies limiting their financial relationships with coal operators that practice MTR coal mining."
According to Rebecca Tarbotton, executive director of the Rainforest Action Network, "When the top four banks in the country back away from Massey Energy and other leading mountaintop mining operators, it sends a clear signal that these companies have a high risk profile and that other banks should beware. Bottom line, as access to capital becomes more constrained it will be harder for mining companies to finance the blowing up of America's mountains."
At present, according to the Rainforest Action Network, PNC finances mining companies responsible for almost half of all coal mined through mountaintop removal in the U.S.
This article originally appeared at SocialFunds.com and is reprinted with permission.
Image CC licensed by Flickr user rachelmolenda.