Several climate scenarios suggest that to limit global temperature rises to 1.5°C above the pre-industrial average, the world needs to be investing $4 in renewable energy for every $1 invested in fossil fuels by 2030.
Energy analysts BloombergNEF compiled data from 1,142 banks for what it calls an 'Energy Supply Banking Ratio' to assess whether banks are aligning their financing to the real economy and the 1.5°C target.
In 2021, bank financing for energy supply totalled $1.9tn, just over $1tn of which went to fossil fuels and $842bn to low-carbon energy projects and companies, according to the report.
The bank financing ratio, of 81 cents to $1, was below the global energy supply investment ratio of 90 cents to $1. The latter ratio has been climbing in recent years from around 0.45:1 between 2011 and 2015.
"While a bounce in fossil fuel investment is expected to counter the disruption caused by Russia’s invasion of Ukraine, the underlying economics...