2025 banks’ energy financing ratios: the good, the bad and how to move forward

The report assesses the use of the Energy Supply Financing Ratio (ESFR) by global banks to measure sustainable power financing relative to fossil fuels. While six banks have now published or committed to this indicator, the analysis reveals a regional divide: European banks (BNP Paribas, Crédit Agricole, Groupe BPCE) often use narrow fossil fuel definitions and omit underwriting, while North American banks (Citi, JPMorgan Chase, RBC) include broader financing instruments but inflate sustainable ratios by including fossil-related technologies like carbon capture and fossil-based hydrogen.

• To align with the International Energy Agency’s (IAE) Net Zero Emissions (NZE) scenario for carbon neutrality by 2050 and a 1.5°C warming limit, banks are expected to reach an ESFR of 6:1 (six dollars for sustainable energy for every one dollar for fossil fuels) by 2030.
• Actual bank financing is significantly below the required trajectory; between 2021 and 2024, the 65 largest global banks had an ESFR of 0.42:1, allocating only 42 cents to sustainable power supply for every dollar directed to fossil fuels.
• European banks BNP Paribas, Crédit Agricole, and Groupe BPCE understate their fossil fuel support by excluding major sectors like liquefied natural gas (LNG) and gas-fired power generation, and by omitting bond and equity underwriting from their ratios.
• North American banks Citi, JPMorgan Chase, and RBC use more comprehensive financing coverage but inflate their sustainable ratios by including non-sustainable or unrelated activities, such as fossil-based hydrogen, carbon capture and storage, and industrial processes like cement manufacturing.

APA

Manickawasagar, A. (2026). 2025 banks’ energy financing ratios: the good, the bad and how to move forward. Reclaim Finance. https://reclaimfinance.org/site/en/2026/01/20/2025-banks-energy-financing-ratios-the-good-the-bad-and-how-to-move-forward/

Chicago

Manickawasagar, Aatiraï. 2025 banks’ energy financing ratios: the good, the bad and how to move forward. Reclaim Finance, 2026. https://reclaimfinance.org/site/en/2026/01/20/2025-banks-energy-financing-ratios-the-good-the-bad-and-how-to-move-forward/.

Wikipedia

{{cite report |last1=Manickawasagar |first1=Aatiraï |title=2025 banks’ energy financing ratios: the good, the bad and how to move forward |publisher=Reclaim Finance |date=20 January 2026 |url=https://reclaimfinance.org/site/en/2026/01/20/2025-banks-energy-financing-ratios-the-good-the-bad-and-how-to-move-forward/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{manickawasagar20262025, author = {Manickawasagar, Aatiraï}, title = {{2025 banks’ energy financing ratios: the good, the bad and how to move forward}}, institution = {Reclaim Finance}, year = {2026}, month = jan, url = {https://reclaimfinance.org/site/en/2026/01/20/2025-banks-energy-financing-ratios-the-good-the-bad-and-how-to-move-forward/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }