SpareBank 1 SR-Banks transition plan
SpareBank 1 SR-Bank's ambition is to be the customer's ally and contribute to financing the transition
SpareBank 1 SR-Bank's ambition is to be the customer's ally in the sustainability transition, and at the same time our goal is to achieve net-zero emissions from our loan portfolio by 2050.
lt is not enough to just set goals/targets. Our tansition plan will guide us and show us if we are on track or not. At the same time, we know that the path will change as we gain more knowledge and data quality improve. A good and credible transition plan will ensure that SpareBank 1 SR-Bank has a business model that stands strong today and in the future.
To limit climate change, we need to reduce emissions as quickly as possible and restructure society. By the end of 2050, emissions must be reduced by 90-95% compared with 1990 levels. This means that many industries need to get down to zero or must ensure a net sequestration of atmospheric CO2 since it is impossible to reduce emissions by that much.
The transition that society and our customers will have to undergo over the next few decades will certaintly be demanding, although it will also offer a number of opportunities. In this first version of our transition plan, the most material industries are included: Commercial Property, Shipping, Oil and Gas, and Agriculture.
The path to zero-emissions society will change in the years to come. The plan will be further developed and expanded to encompass an increasingly larger part of the loan portfolio. The important ting now, both for SpareBank 1 SR-Bank and our customer, is the direction we now are presenting in our transition plan.
As a bank, we cannot implement this transition alone and we will be dependent on a number of external factors, whether that be technological developments, policies, regulations or market changes.
SpareBank 1 SR-Bank will support all customers with the transition by providing good advice and offer financing.
Commercial Property
Commercial property accounts for about 13% of the total loan portfolio and is the largest industry with respect to our lending in the corporate market. Emissiosn related to energy consumption (scop 2) accounts for only 0.5% of emissions in the portfolio.
While Norway's buildings largely consume renewable energy and therefore generate relatively low emissions, it is important, from a climate perspective, to reduce such consumption in order to free up energy for the decarbonisation of other sectors.
The target trajectory is stated in KGCO2e per m2 and is based on the Carbon Risk Real Estate Monitor (CREEM), an EU funded project that has set targets trajectories for different categories of buildings in each country. The figure on the right shows the target trajectory for office buildings as an exampl, where emissions per m2 must be reduced by 44% from the 2020 level by 2030. This will be done by consuming less energy and decarbonising the power system.
Shipping
Shipping accounts for about 80% of the transport used in global trade and is the most effiicient transport method for greater distances. For SpareBank 1 SR-Bank,shipping includes ferries and offshore vessels and accounts for about 2.5 % of lending while also accounting for nearly 25% of total emissions in the portfolio. Shipping is an emission- intensive industry that needs to transition to meet the global emissions targets.
The shipping target trajectory is based on the Poseidon Principles, which SpareBank 1 SR-Bank signed in 2020 and has reported in line with since 2021. The Poseidon Principles is a global collaboration between banks designed to measure and disclouse emissions from finances shipping portfolios. Fuel consumption and distance sailed are reported annually for each vessels. These are used to calculate the vessels' CO2 emissions per tonne of cargo tansported per nautical mile.
Oil and gas
The oil-and gas industry is important in the global energy system and accounts for around 50% of the world's energy consumption.
Oil and gas combustion is one of the largest drivers of CO2 emissions to the atmosphere and the resulting global warming. Although the highest emissions come from combustion, production and extraction on the Norwegian continental shelf also generate significant emissions.
The target trajectory is based on the goals of Offshore Norway and the Norwegian Government for the Norwegian continental shelf, with a reduction of 50% by 2030 and a further 90-95% by 2050, again with 2005 as the benchmark, target SpareBank 1 SR-Bank also support.
Agriculture
Agriculture is greenhouse gas intensive and is one of the industries with the highest emissions in Norway at 7.2 million tCO2e. The industry has signed a climate agreement with the government on reducing greenhouse gas emissions. The agreed reduction for the agriculture industry combined is 5 million tCO2e in the period 2021-2030.
This entails an 11,5% reduction between 2020 and 2030.
For SpareBank 1 SR-Bank, loans to agricultural customers accounts for around 2.5 % of total lending and 22 % of total emissions in the portfolio.