West Virginia won't work with major banks that pledged to fight climate change
West Virginia said Thursday that it would no longer do business with five financial institutions over their pledges to fight climate change by reducing financing for fossil fuel projects.
Why it matters: It's the first time a state has severed financial ties with major financial institutions over their policies to reduce the emissions of planet-warming greenhouse gases, the New York Times reports.
- The decision, announced by West Virginia Treasurer Riley Moore, will prevent BlackRock, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo from receiving state banking contracts from Moore's office.
What they're saying: "As state treasurer, I have a duty to act in the best interest of our state and its people," Moore said in a video uploaded to social media.
- "Any financial institution that has broad, sweeping policies that will harm our economy, tax base and energy jobs has a clear conflict of interest in handling our tax dollars," he added. "If a financial institution does not want to do business with our people, I don't think we should give them our business either."
- “I simply cannot stand by and allow financial institutions working against West Virginia’s critical industries to profit off the very funds their policies attempt to diminish," he said in a statement.
The big picture: Moore was given the authority to add financial institutions to a "Restricted Financial Institution List" and bar them from doing business with the state by a law passed by the West Virginia legislature last year.
- After the law was passed, Moore's office originally identified six institutions, but U.S. Bancorp was not listed because eliminated its policies against financing coal mining, coal power and pipeline construction activities.
- The West Virginia Treasury said the state collects hundreds of millions of dollars in coal and other fossil fuel severance taxes, which typically represent its third-largest revenue source.
- Consumption of coal, the most carbon-intensive fuel, is expected to rise slightly this year because of rising natural gas prices, Axios' Ben Geman reports.
- The state's additions to the exclusions list came the day after Sen. Joe Manchin (D-W.Va.) said he would support a reconciliation package that would allocate $369 billion to address climate change.
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