Barclays focuses capital and resources on supporting energy companies to decarbonise

• Introduces restrictions for new and non-diversified oil and gas clients engaged in expansion.
• Establishes clear expectations of transition strategies and decarbonisation requirements for energy clients.
• Publishes Transition Finance Framework to help meet $1trillion Sustainable and Transition Finance target.

Barclays today publishes a revised Climate Change Statement to progress its climate strategy and continues its focus on clients actively engaged in the energy transition. Following Barclays’ commitment to finance $1trillion of Sustainable and Transition Finance by 2030, Barclays also releases a Transition Finance Framework to support us to meet that target and facilitate the transition finance needed to decarbonise high-emitting sectors.

The updated Climate Change Statement outlines:

• No project finance, or other direct finance to energy clients, for upstream oil and gas expansion projects or related infrastructure.
• Restrictions for new energy clients engaged in expansion.
• Restrictions on non-diversified energy clients engaged in long lead expansion.
• Additional restrictions on unconventional oil and gas, including Amazon and extra heavy oil.
• Requirements for energy clients to have 2030 methane reduction targets, a commitment to end all routine / non-essential venting and flaring by 2030 and near-term net zero aligned Scope 1 and 2 targets by January 2026.
• Expectation for energy clients to produce transition plans or decarbonisation strategies by January 2025.

In the International Energy Agency NZE scenario, new long lead time upstream oil and gas projects are not required on a 1.5°C-aligned pathway. For current and future (declining) global demand to be satisfied, investment is needed to support existing assets while clean energy is scaled^[1]. Barclays understands the critical importance of energy being secure, reliable and affordable for our customers and clients.

Barclays will continue to support an energy sector in transition, focusing on the diversified energy companies investing in low carbon and with greater scrutiny on those engaged in developing new oil and gas projects.

The scale of our business gives us the opportunity to help finance the energy transition; to use our global reach, products, expertise and position in the global economy to work with our clients, including those in the energy sector, as they transition to a low-carbon business model.

This policy is an important lever for reducing our financed emissions and has been informed by engagement with stakeholders – shareholders, clients, climate experts and civil society groups, including ShareAction. Barclays is committed to continue to engage regularly with its stakeholders as its climate strategy evolves in light of the rapidly changing external environment.

Details can be read in the Barclays Climate Change Statement (PDF 724KB) and information on the progress of our climate strategy will be provided in the Climate and Sustainability Report, due to be published in February 2024.

Transition Finance Framework

Capital is critical to delivering the energy transition with at least $4.3trillion of climate finance needed annually by 2030^[2].  Barclays today publishes a Transition Finance Framework (PDF 743KB) outlining the criteria for transition finance transactions which will also be included towards Barclays’ target to facilitate $1trillion of Sustainable and Transition Finance between 2023 and by the end of 2030.  

Read the Transition Finance Framework in full here (PDF 1.1MB).

Energy Transition Group

Barclays continues to invest in the talent and expertise to provide clients with the capabilities and guidance needed to support their transition and recently announced the creation of a new Energy Transition Group in the Corporate and Investment Bank, led by Mike Cormier, Global Head of the Energy Transition Group.

Laura Barlow, Group Head of Sustainability, said, “Addressing climate change is a critical and complex challenge. We continue to work with our energy clients as they decarbonise and support their efforts to transition in a manner that is just, orderly and addresses energy security. Today we strengthen our commitment to the energy transition, with policies that will focus our capital and resources to the energy companies that play a key role in the transition.”

Daniel Hanna, Head of Sustainable Finance, Corporate and Investment Bank, adds, “Capital is critical to the energy transition, to decarbonise hard-to-abate sectors for the world to reach net zero emissions and create a resilient economy. As the number two ranked clean energy advisor globally by BloombergNEF, Barclays is strongly positioned with our capabilities and experience, global reach and role in the global economy to accelerate the investment needed for real-world decarbonisation, while supporting our energy clients’ transition.

“Publishing our Transition Finance Framework reinforces our commitment to be transparent in how we are mobilising $1trillion of Sustainable and Transition Finance by the end of 2030 while Barclays continues to be a leading global clean energy adviser and financier, unlocking growth from the energy transition.”

ENDS

[1] International Energy Agency – Net Zero Roadmap, 2023 Update

[2] Climate Policy Initiative – Global Landscape of Climate Finance: A Decade of Data

Notes 

·       Barclays set 2025 and 2030 science-based, Paris-aligned targets for the Energy and Power sectors, in 2020 and 2022 respectively.

·       BloombergNEF ranked Barclays the number two clean energy advisor globally in BloombergNEF 2H 2023 Clean Energy League Tables, published 8 January 2024.