Most people in the United States do not have a good grasp of how the banks work.  Customers think they put their money in to a savings or checking account and it is available exclusively for them.  However the banks use this money to lend to businesses and to private individuals for home mortgages.  These businesses then pay interest on the loan and the bank makes a profit.  Unfortunately, the businesses the banks invests in, might not be ones that the consumer would want to fund.

 The biggest banks in the United States lend money to fossil fuel companies.  Fossil fuels are not renewable energy sources. The extraction and use of these fuel sources contributes to global warming (for more information read The Eternal Fire) and the greenhouse effect . All the big banks signed the Paris Agreement and then simply ignored their pledge. In fact, since taking the pledge the money funneled to fossil fuel companies from banks has increased every year.  It has already passed a trillion every year (Z Zhongming et al 2021).

 🌊Banks Slow To Move Money To Renewable Energy☀️

 The banks like to claim they will gradually move to lending to renewable energy sources.  They claim that the economy would take too hard of hit if they switched all at once. The simple fact is the fossil fuel industry needs the banks money.  It takes money to find the resource, extract, refine and transport it.  Without this money there would be no fossil fuels available for public use.  The banks know that fossil fuels are a good investment because many governments offer fossil fuel subsides. Governments around the world funnel 400 billion dollars a year into the fossil fuel industry (Z Zhongming et al 2021).   The banks will finance this resource until it becomes uneconomical to do so.

For quite a few years the rationale behind financing fossil fuels was simply profits.  Renewable energy had the disadvantage of high upfront cost versus the low (with government subsidizes) cost of fossil fuels.  Plus it takes longer for renewable energy to recoup the losses (Z Zhongming et al 2021.  However over the last decade there has been a precipitous drop in the cost of solar and wind power, which has led to an accelerated expansion in the use of these technologies.  In fact according to Bill Mckibben renewable energy has now become more profitable than coal or gas (Bill Mckibben 2019).

🤑 Government Money💸

As far as the planet is concerned 1/4 of all carbon emissions would be eliminated if government subsides vanished.  At the current time oil provides more of the world’s energy than any other source.  Governments help to keep this resource relatively cheap so there is both more consumption and more production, which leads to earth continuing to get hotter.  The only winners here are the oil companies and the banks that finance their operations. If we let the invisible hand do its work then we could reduce the toll on our planet by 25% (P. Erickson et al 2020).

In recent years the public has grown concerned over the banks investments in fossil fuels.  In response quite a few of the big banks have engaged in green washing.  That is, they put on a show to make it look like they care about the environment.  They LEED certify their buildings and they give a nominal amount to renewable energy companies. The banks are shrinking the amount they lend to coal and gas simply because currently they are less profitable than renewables.  However, they are still pouring billions into oil (M. Roszowska-Memkes 2020).   This practice fools some of the public so they don’t move their money to greener pastures.

🏡Money Created From Renewable Energy🚙

Most big banks are aware that renewable energy can be more profitable than coal or gas. Nevertheless, some banks put their largest investments into oil.  That has the best return on the money for them.  That is why they are so hesitant to stop investing in it.  Some banks will move their fossil fuel investments into their mutual fund portfolio so it more hidden from the public eye.  It is interesting to note that investment portfolios without fossil fuels don’t perform better or worse than with them (A. Tanks et al 2018).

If you don’t want your hard-earned money used for exploiting the earth then the solution is simple.  Move your money to a green bank.  These banks offer green loans and bonds.  They only invest in companies with low carbon emissions and those that utilize renewable energy.  These loans are used for green energy projects such as eco-houses, electric/hybrid cars and solar panels (L. Malandrakis 2020) 

🌎 Green Banks Money💰

Unfortunately, banks are not required to disclose that they are giving money to the fossil fuel industry.  However here are some ways to figure out if a bank is green or not.  Look for Ceritifed B-Corp banks: these banks meet the highest standards of both social and environmental performance.  Another certification to look for is Global Alliance for Banking.  This is a network of financial institutions that deliver both social and environmental enhancements and development.  (Joao Batista Brillo de Carvalho 2018).

To be absolutely certain your money is not being used for fossil fuels then look up the websites of these three entities that research this matter.  They keep lists of green banks across the country.  They can certify that these banks do not put any money into fossil fuels, it just goes to renewable energy sources.  These three organizations in the United States are Mighty Deposits, Green America, and Rainforest Action Network.  In Europe and Asia Reclaim Finance can be utilized.

🏦 Move Your Money 💵

Sometimes banks make it difficult to move your money.  However with perseverance and some red tape everyone can move their money.  Every person can a difference no matter the size of their bank account.  If every big bank client pulled out money out of their savings and checking account and put it into a green bank, then oil production could be impaired.  Do your research, move your money, and watch the planet breathe a little easier.