Global banks are behind the net zero benchmark on their energy supply ratios

Scotiabank has become the first Canadian bank to publish its energy supply finance ratio, after removing its 2030 oil and gas sector emissions targets from its 2025 sustainability report.

The energy supply finance ratio, which shows how much banks finance renewables compared with fossil fuels, was first developed by BloombergNEF as a metric to measure progress on energy transition financing with figures dating back to 2021.

BloombergNEF forecasting suggests the necessary global ratio for a net zero pathway by 2030 is 4:1, or $4 spent on renewables for every $1 spent on fossil fuels.

Canadian Imperial Bank of Commerce’s published 2025 ratio is 0.65:1. The bank says it will use the metric to help it understand how the transition is being financed.

Only a handful of banks globally have released their energy supply ratios, including BNP Paribas, Crédit Agricole, Citi, Groupe Banque Populaire, Caisse d’Epargne and JPMorgan Chase, says non-profit Reclaim Finance. As of 2024, all global banks lagged behind, with BNP Paribas leading the pack at 2.27:1.

“We are evolving our climate strategy to focus on what we do best — leveraging our financial and structuring expertise to capture market opportunities across energy types, including the energy transition,” said a spokesperson for Scotiabank in a statement to Sustainable Views on the changes in its 2025 sustainability report. “To support this shift, the bank has introduced the energy supply ratio.”

The Royal Bank of Canada has also withdrawn its 2030 oil and gas sector emissions targets, and despite publishing a methodology and a promise to publish its energy supply finance ratio, has yet to release a number.

“The operating environment has changed significantly since we set 2030 interim emissions reduction targets in 2022 for the oil and gas [sectors],” said an RDC spokesperson in a statement to Sustainable views. “Shifts in government policy, regulatory frameworks, technological advancements, geopolitical developments, and energy demand and security have created an uncertain landscape.”

The metric is essential to measuring climate finance progress, says Francisca Quinn, founder of sustainable finance consultancy Quinn+Partners, who sits on the board of the Responsible Investment Association of Canada.

“To have sustainable finance goals, you need a standard in which you can measure your progress against,” she says.

An in-house number has the advantage of more extensive data than Bloomberg’s figure, says Amanda Carr, associate director at the Shareholder Association for Research and Education, a responsible investment organisation.

Publishing the ratio exposes the real balance of capital allocation among the Canadian financial institutions that continue to publish sustainability reports, Carr argues.

“The ratio supports our understanding of exposure to the transition and the opportunities being seized,” she says.

Still, Scotiabank’s and RBC’s climate target rollbacks are worrisome, and signal a decay in accountability, she adds. “The banks all say they’re still committed, but what are the drivers behind that commitment?”

Policy slide

The slide on climate-related policy in Canada has probably played a role in the banks’ decisions because green financing has become less attractive, says Quinn.

“The policy environment has slowed down, which means that there’s a reduction in the demand [for green financing],” she says. “There are more possible energy [projects] now than are getting financed.”

Only 58 megawatts of new corporate power purchase agreements for renewables in Alberta were announced in 2024 and 2025, representing a 99 per cent drop from 2023, notes think-tank Business Renewables Centre-Canada.

RBC was asked at its April 9 annual meeting about its commitment to publish the ratio and told investors to remain patient.

“We’re not refusing to disclose [the ratio],” said RBC chief executive Dave McKay at the meeting. “We’re making those calculations now and you will see us disclose that energy ratio.”

The CIBC has also published a methodology for the energy supply finance ratio but has yet to commit to publishing the number.

BloombergNEF has not updated figures for its 2025 energy supply ratios.