AXA’s decision to eliminate its exposure to the global coal industry over the next two decades has ratcheted up the pressure on European companies to quickly announce definitive coal phase-out plans, in line with the goals of the UN Paris climate deal by 2021, according to Kaarina Kolle, finance and utility coordinator at Europe Beyond Coal. Kolle described AXA’s move as the “only defensible position” for European financial institutions when it comes to coal.
Lucie Pinson – an adviser for the finance campaign of Friends of the Earth France, a Paris-based NGO – agreed, noting that the AXA announcement significantly ramps up pressure on other insurance groups and financial institutions, including Talanx and BNP Paribas, to avoid “looking flat-footed” by quickly following suit by issuing more assertive coal policies of their own.
“AXA has set a new global benchmark for best practice with this coal phase-out policy,” claimed Pinson. “Zero tolerance for coal expansion is the only responsible action in a carbon-constrained world, and dumping coal companies like RWE, Adani, and KEPCO is essential for financial institutions that do not want to be complicit in the damage these companies cause to the climate and human health.”
Earlier this week, organizers of the fifth Climate Finance Day in Paris deliberately excluded about 400 companies that are still involved in the use of coal – underscoring the growing push in Europe to move away from fossil fuels. In late October, Carbon Tracker – a London-based, not-for-profit think tank – said that roughly 79% of coal-fired power plants in Europe operate at a loss. It estimated that total coal-related losses on the continent will hit €6.57 billion this year alone.
A recent study by EnAppSys showed that the European power market has already made significant progress in its shift away from coal-fired power generation. However, thus far this has largely benefited the gas sector, rather than renewables, the research firm said.