12 April 2019
Mr. John Michael Flint, Group Chief Executive
HSBC, 8 Canada Square, London E14 5HQ, United Kingdom
HSBC, 8 Canada Square, London E14 5HQ, United Kingdom
We are writing you from Bangladesh Working Group on External Debt (BWGED) on an issue which is crucially important for us.
In the London AGM of HSBC in 2018, you announced that the institution had revised its energy policy to "stop financing new coal-fired power plant in all countries around the world". Thanks go to shareholders and Board of Directors of HSBC for this timely revision in line with Paris Agreement and Sustainable Development Goals (SDGs) towards a green earth for the next generations. But we are disappointed to see the last words of the sentence which is "... apart from Bangladesh, Indonesia and Vietnam.”
As organisations and citizens of Bangladesh, we consider this incredibly disappointing and urge that HSBC, at or before its April 2019 AGM, announce it will stop funding new coal everywhere effective immediately.
A recent study of Harvard University researchers projects that pollution from coal-fired power plants could result in 43,620 excess deaths in Indonesia and Vietnam every year by 2030. Coal plants in our countries not only harm us but are projected to cause significant deaths in China, Thailand, Myanmar and throughout the rest of East Asia. We hope Bangladesh never experiences the consequences of coal to this extent.
In order to achieve the climate goals of the Paris Agreement, the Executive Director of the International Energy Agency has warned that “we have no room to build anything that emits CO2 emissions.” Oxford University researchers estimated that even if the entire global pipeline of power generation was cancelled, “up to 20% of global fossil-fuel generation capacity would still have be stranded (that is, prematurely decommissioned, underutilized, or subject to costly retrofitting) if humanity is to meet the climate goals set out in the Paris Agreement.”
Modelling from University of Technology Sydney researchers finds that for a two-thirds chance of limiting warming below 1.5°C the equivalent of 30% of global coal-fired power capacity "must end operation by 2025". Despite the weight of evidence and HSBC’s rhetorical acknowledgement of climate change, the bank continues to actively support new and expanded coal projects in developing countries.
In Bangladesh HSBC is leading a consortium of banks funding dredging at the Port of Payra to allow for increased coal imports. Land acquisition for the Payra Port has reportedly displaced 1,743 families, with residents who gave up their land struggling to retrieve compensation due to corruption.
According to local media, there are plans for five coal-fired power plants in areas adjacent to the port. These plants have raised human rights concerns, notably regarding farming and fishing livelihoods being impacted, and land being grabbed without compensation. The coal imported through Payra Port would supply these power stations. Therefore, HSBC plays a critical role in enabling impacts associated with them.
Transparency International Bangladesh (TIB) has called for the immediate withdrawal of project approvals for the proposed 350 MW Barisal power station, situated within 20 km of Payra Port. In a media release TIB Executive Director Dr. Iftekharuzzaman said: "If the thermal power plant is established, the local biodiversity, especially wildlife habitat will be destroyed."He also called for a stop to the ongoing harassment and torture of local citizens in connection with the project.
HSBC sits in stark contrast with competitor bank Standard Chartered which last year ruled out funding new coal-fired power plants globally. According to Chairman José Viñals; “To pull millions out of poverty, we need reliable and affordable electricity and, up until now, that has meant burning coal – almost nine billion tonnes of it every year. This cannot continue: as former UN Secretary-General Ban Ki-Moon said about climate action, "there is no plan B because there is no planet B". Standard Chartered’s policy is proof there’s simply no excuse left for banks like HSBC to contemplate funding new coal power anywhere.
When will HSBC recognise that developing countries such as Bangladesh have as much as right as their developed counterparts to clean energy and clean air?
We call on HSBC to:
- Stop financing Dredging and other construction in Payra Port area which facilitate coal fire power plants in ecologically fragile areas.
- Stop funding new coal-fired power plants globally;
- End the refinancing of coal projects and the financing of coal infrastructure by 2020; and
- Prohibit general corporate financing, underwriting and advisory services to companies that are highly dependent on coal mining, power and infrastructure.