The Royal Bank of Scotland (RBS) announced Tuesday that it would no longer provide project-specific finance to new coal-fired power stations, new thermal coal mines or Arctic oil projects.
The bank has also ended financing for oil sands projects, unsustainable vegetation or peatland clearance projects, according to a press release.
"These changes follow the bank's substantial reductions in fossil fuel exposures and growth in renewables in recent years as it refocuses its business on the U.K., Ireland and Western Europe," the bank said.
Noting a "growing interest" in the role banks can play in tackling climate change, RBS said it had funded more British renewable energy projects than any other U.K. bank for the last six years running.
"In addition, RBS is also tightening its restrictions on general lending to companies involved in coal, meaning it will not provide finance to mining companies generating more than 40 percent of their revenues from thermal coal – a reduction from 65 percent," the statement said.
Included are also power companies generating more than 40 percent of their electricity from coal – again a reduction from 65 per.
According to the statement, RBS announced in March that it was committing to provide £10 billion ($13.2 billion) of funding to the sustainable energy sector between 2018 and 2020 and that 80 percent of its energy project financing went to renewables in 2017.
The bank sources 90 percent of its U.K. and Ireland electricity from renewables and reported a 39 percent drop in its own CO2 emissions since 2014 with plans to develop further measures to help personal and business customers reduce their own emissions and energy costs.
Kirsty Britz, director of Sustainable Banking at RBS, underlined the change the bank went through recently.
"The RBS of 2018 is very different to the bank we were a few years ago. If we're going to support our customers in the long run, then it means addressing the challenge of climate change and the risks and opportunities it presents," she said.
"We want to help build a cleaner, more sustainable economy for the future, and these policy changes form part of our broader approach to this major issue."
By Hale Turkes