Corporations that are hurting the environment are having trouble getting loans. Banks do not wish to lend to them. Mountaintop removal mining is just one of the examples of a business that banking institutions get huge profit funding to, although the company is destructive. Now there appears to be a lot of environmental pressure and decisions made in court making it so banking institutions are held responsible for anything that causing the environment destruction that they financed. Financial institutions want to do anything they can to please and keep customers. This is why many banks have decided to stop lending to any businesses that have risk of environmental damage. Post resource – Big banks backing away from financing mountaintop removal mining by Personal Money Store.
Destruction of the environment is what banks lend to support
Getting cash is not that hard. Mountaintop removal mining corporations will find a way to get it. But the New York Times reports that bank industry analysts are saying intense debate about climate change, water quality standards and other environmental issues is compelling lenders to think twice about where they extend credit and to whom. Recently Wells Fargo made a statement about “considerable attention and controversy” related to mountaintop removal mining. ”Limited and declining,” is the phrase it used to talk about mountaintop mining companies getting financing. They are likely to be denied. Credit Suisse, Morgan Stanley, J.P. Morgan Chase, Financial institution of America and Citibank have all made the exact same decision Wells Fargo is making. All these banks vowed to either reconsider lending to mountaintop mining corporations or to discontinue financing them altogether.
Purchase cheap coal with mountaintop removal mining
Mountaintop mining is something the Appalachian region environmentalists do not like. In fact, they used an opportunity with the Obama administration on Monday to try and get it banned. The Associated Press said the group is preparing a rally for September 27. They even had high hopes in inviting the president to come with them. To get coal via mountaintop removal mining, forests are clear-cut first. They have to use explosives then. This is to break huge rock. Huge machines eight stories high scoop away up to 800 feet of mountaintop to expose coal seams. Streams and wildlife habitats are hurt when the dirt picked up is dumped into valleys. Operators say it is the cheapest way to reach coal for electric power plants and supports tens of thousands of jobs. The Appalachian coal industry is hoping no to lose numerous jobs with this. It plans to have a rally in Washington on September 15 to show its support for coal.
Numerous banks excited
The Rainforest Action Network (RAN) has tried to stop financing for mountaintop removal mining through financial institutions since 2007. The top mountaintop mining business in West Virginia is called Massey Energy. Because of the RAN efforts, the top four banking institutions in the country have stopped lending to it. Massey Energy was involved in the Upper Large Branch mine explosion that killed 29 miners in April. Seems like like numerous banks are ready for this. Banks want to lend to them. According to Bloomberg data, PNC and UBS are presently the lead financiers of mountaintop removal mining. PNC is responsible for a ton of coal getting used in the U.S. In fact, half of coal from mountaintop mining is financed by PNC.
Additional reading
New York Times
nytimes.com/2010/08/31/business/energy-environment/31coal.html?_r=1 and dbk
Associated Press
google.com/hostednews/ap/article/ALeqM5iRFjIvp7yDpMnistp_aolQIRAj_QD9HTVS4O0
Organic Consumers
organicconsumers.org/articles/article_21396.cfm
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