Will "Carbon Principles" put the squeeze on coal plants?
New York's Citigroup, JPMorgan Chase and Morgan Stanley, announced today that they have adopted a set of guidelines to put a damper on coal plant investments in the U.S.
The banks said the new guidelines, called the Carbon Principles, would provide a framework for the lenders to evaluate the regulatory and financial risks associated with carbon dioxide emissions by coal-fired power projects.
"Leading utilities and financial institutions understand that the rules of the road have changed for coal," said Mark Brownstein, managing director of business partnerships for Environmental Defense, one of the non-governmental organizations that worked on creating the guidelines.
"These principles are a first step in facilitating an honest assessment of electric generation options in light of the obvious and pressing need to substantially reduce national greenhouse gas pollution."
The banks did not announce any guidelines for projects in areas outside of the U.S.
Under the new principles, the banks said they would promote energy efficiency by encouraging clients to invest in cost-effective demand reduction systems.
The banks said they also plan to encourage clients to invest in renewable energy and distributed technologies.
"Clean power is the name of the game today," said Dale Bryk, senior attorney at the Natural Resources Defense Council, a non-profit environmental advocacy group.
"Conventional coal facilities are already facing intensive scrutiny. We think the serious money is increasingly going to be on clean, efficient solutions," said Bryk.
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