A controversial way of measuring how much methane warms the planet has stirred debate in recent years – particularly around assessing the climate impact of livestock farming.
The metric – known as GWP* (global warming potential star) – was designed to more precisely account for the warming impact of short-lived greenhouse gases, such as methane.
No country so far has used GWP* to measure emissions, but New Zealand is currently considering its use.
In June, a group of climate scientists from around the world wrote an open letter advising against this.
They argued that the metric “creates the expectation that current high levels of methane emissions are allowed to continue”.
Climate experts tell Carbon Brief that there is “no strong debate” on the science behind GWP* and that it can accurately assess the global warming effect of methane.
But many experts also firmly caution against its use in national climate targets, believing it could allow countries to prolong high levels of emissions at a time when they should be drastically cut.
Some researchers tell Carbon Brief that GWP* is an “accounting trick” and a “get-out-of-jail-free card for methane emitters”. A 2021 Bloomberg article called the metric “fuzzy methane math”.
Prof Myles Allen, one of the scientists who created GWP*, tells Carbon Brief that the metric is “nothing more” than one way of better understanding the climate impact of different actions as part of efforts to limit warming under the Paris Agreement.
In this Q&A, Carbon Brief explains the science behind GWP*, why the metric is so divisive and the ways in which its use has been considered.
- What is GWP*?
- What are the main controversies around using GWP*?
- Do any countries currently use GWP* to measure methane emissions?
- What do experts think about the use of GWP*?
What is GWP*?
Global warming is caused by a build up of greenhouse gases – mainly from burning fossil fuels – trapping heat in the atmosphere.
Different gases cause differing levels of warming and remain in the atmosphere for varying lengths of time. For example, carbon dioxide (CO2), the main contributor to warming, lingers for centuries, whereas other gases last decades or even millennia.
To account for these variables, scientists use a metric known as global warming potential (GWP), which assesses the warming caused by different gases compared to CO2, which has a GWP of 1.
Using GWP, emissions of other gases are calculated in terms of their “CO2 equivalent” over a given amount of time.
In their reports, the Intergovernmental Panel on Climate Change (IPCC) set out three GWP variants measured over 20 years (GWP20), 100 years (GWP100) and 500 years (GWP500).
GWP100 is the most common approach and is used to calculate emissions under the Paris Agreement.
Methane is a short-lived gas that only remains in the atmosphere for around 12 years before breaking down. But it causes a large burst of initial warming that is around 80 times more powerful than CO2, according to the IPCC.
This means that one tonne of methane causes the same amount of warming as around 80 tonnes of CO2, when measured over a period of 20 years.
When calculated over 100 years, methane’s shorter lifetime means it causes around 30 times more warming than CO2.
Some experts have criticised the use of GWP100, saying it does not sufficiently account for the fact that methane leaves the atmosphere much more quickly than CO2 and does not actually last for 100 years. This is the issue that GWP* was designed to fix.
GWP* calculates the warming contributions of long- and short-lived gases at different rates, accounting for their varying lifetimes in the atmosphere.
One of the researchers behind GWP*, Dr Michelle Cain, explained in a 2018 Carbon Brief guest post that a constant rate of methane emissions can maintain stable atmospheric concentrations of the gas, assuming methane sinks remain constant as well.
In contrast, a constant rate of CO2 emissions “leads to year-on-year increases in warming, because the CO2 accumulates in the atmosphere”, Cain wrote. CO2 does not leave the atmosphere after a decade or so, as methane does, and continues to build over time until emissions stop.
Cain, formerly a researcher at the University of Oxford and now a senior lecturer at Cranfield University, added:
“For countries with high methane emissions – due to, say, agriculture – this can make a huge difference to how their progress in emission reductions is judged.”
Methane emissions that slowly decline or remain stable over time are calculated as contributing “no additional warming” to the planet, which is not the case with other GWP calculations.
The chart below shows simplified emissions scenarios for CO2 and methane, highlighting the different impacts they have on global warming over time.
The chart below shows how using the two different metrics – GWP* and GWP100 – affects the same emissions pathway throughout the 21st century, given the different warming impacts of greenhouse gases.
If, for example, a country emitted 4m tonnes of methane annually from 1990-2005, these emissions would now be considered “climate-neutral” using GWP*, as they are not actively contributing new warming to the atmosphere, but rather maintaining the existing levels of methane in the atmosphere in 1990.
This would not be the case under GWP100, which looks at the warming potential of emissions over the course of a century and does not account for their different atmospheric lifetimes.
GWP* can be used for other short-lived gases, such as some hydrofluorocarbons, but methane is the most significant short-lived gas when it comes to climate change.
The IPCC notes that converting methane emissions into CO2 equivalent using GWP100 “overstates the effect of constant methane emissions on global surface temperature by a factor of 3-4” and understates the impact of new methane emissions “by a factor of 4-5 over the 20 years following the introduction of the new source”.
GWP* was created by several researchers, including Prof Myles Allen, the head of atmospheric, oceanic and planetary physics at the University of Oxford. The concept was detailed in a 2016 study and first named in a 2018 study. It was further updated by the authors in 2019 and 2020.
Allen tells Carbon Brief that the researchers involved were “reluctant” to give their new metric a name, as it “was just a way of using reported numbers to calculate warming impact”. He adds:
“I think it’s really unfortunate that people have latched onto GWP*. It doesn’t matter. We could forget about GWP* entirely, we can just use a climate model to work out the warming impact…GWP* is a handy way of calculating the warming impact of activities. Nothing more.”
What are the main controversies around using GWP*?
Efforts to cut methane emissions are widely viewed as a “quick-win” to help limit the effects of climate change in the short term.
More than 100 countries signed a pledge, launched at COP26 in 2021, to cut global methane emissions by 30% by 2030.
Cutting methane would also help to counteract an acceleration in warming due to declining aerosol emissions, which are currently masking around half a degree of warming.
Experts Carbon Brief spoke to agree on the importance of cutting methane emissions, but disagree on whether GWP* helps or hinders these efforts.
The debate around the metric centres on the possible impacts of its use, rather than the soundness of the science behind it.
Prof Joeri Rogelj, a climate science and policy professor at Imperial College London, explains:
“At the global level, at any level, the method of GWP* actually provides a good, new way to translate the trajectory of methane emissions into equivalent emissions of CO2, or emissions of CO2 that would have an equivalent warming effect…The debate is on the application.”
Allen says he is a “little frustrated” that discussions around the use of GWP* have “become so emotive”. He tells Carbon Brief:
“Every action we take has both a temporary impact on global temperature and a permanent one. How much is in both areas depends on the action. We need to know those two things in order to make decisions about choices of action in pursuit of a temperature goal…GWP* gives you a handy way of doing that.”
Below, Carbon Brief details some of the main discussion points and controversies around GWP*.
Carbon cycle
A misleading claim frequently made about livestock is that cows do not contribute much to global warming because the methane they emit eventually returns to the land through the carbon cycle – the set of processes in which carbon is exchanged between the atmosphere, land and ocean, as well as the organisms they contain.
Those in favour of using GWP* to measure methane emissions often also stress the difference between methane emissions that come from animals – known as biogenic methane – and methane from fossil fuels.
Rogelj tells Carbon Brief that biogenic and fossil-sourced methane are “slightly different, but that difference is really second-order” when it comes to climate change.
Methane warms the planet while it is in the atmosphere, so the “climate effect is exactly the same, irrespective of which source the methane comes from”, Rogelj adds.
The differences become more significant when methane breaks down in the atmosphere and oxidises into water vapour and CO2.
CO2 that originated from a cow can be reabsorbed by plants and the land. But the CO2 resulting from fossil methane – which stems from sources such as flaring from oil and gas drilling – stays in the atmosphere. Although fossil methane has a “bit of a longer effect”, Rogelj says:
“This is a bit of a red herring, because the main effect is, of course, the effect that the methane has while it is methane and not what the carbon molecule of that methane has after [the] methane has been broken down or oxidised to CO2.”
He adds that there are ways of reducing agricultural methane, such as “diet change” or “management measures”, but no way to remove the emissions “100%”.
The graphic below shows the digestive process through which a cow emits methane.
Agriculture also causes other significant environmental harms. It is responsible for around 80% of global deforestation and is a key driver of biodiversity loss and water pollution.
Prof Frank Mitloehner, a professor and air-quality specialist at the University of California, Davis (UC Davis), is one of the main proponents of GWP*, frequently speaking about it in public presentations and discussions with the farming sector.
He tells Carbon Brief that, while animal agriculture can cause environmental harm, it is a “silly argument” to say these impacts are being ignored in carbon-cycle discussions.
He gives an example of discussions on deaths from car accidents excluding mentions of the emissions from cars, saying that these wider impacts are still important and can be discussed separately.
He adds that it is an “urban myth” that biogenic methane emissions are not a concern because of the carbon cycle.
‘No additional warming’
Under GWP*, methane emissions stop causing new warming once they reduce by 10% over the course of 30 years – around 3% each decade, or 0.3% each year.
These emissions are then described in research and policy as causing “no additional warming”.
For example, a 2021 study from Mitloehner and other UC Davis researchers, found that methane emissions from the US cattle industry “have not contributed additional warming since 1986”, based on GWP* calculations. It also said that the dairy industry in California “will approach climate neutrality” by the 2030s, if methane emissions are cut by just 1% annually.
(According to the US Environmental Protection Agency, methane emissions from enteric fermentation – the digestive process through which cows produce the greenhouse gas – increased by more than 5% over 1990-2022.)
However, many critics take issue with the “no additional warming” concept.
The main criticism is that, although a gradually reducing herd of cattle may stabilise methane emissions, it still emits the polluting gas. If animal numbers were instead drastically reduced, this would cut methane emissions and lower warming rather than maintaining current levels.
Dr Caspar Donnison, a postdoctoral researcher at Lawrence Livermore National Laboratory in the US, says the term no additional warming is “absolutely misleading” in the context of GWP*. He tells Carbon Brief:
“You just assume, on the face of it, that this means it has a neutral impact on the climate…But ‘no additional warming’ means that you’re still sustaining the warming that the herd is causing.”
Allen says that the debate focuses on the “stock of warming versus additional warming”. He compares it to accounting for historical emissions of CO2:
“If a country got rich by burning CO2, they’ve caused a lot of warming in the past. If they reduce their CO2 emissions to zero, then people are generally happy to call what they’re doing climate-neutral, even though they may be sitting on a huge heap of historical warming caused by their CO2 emissions while they were burning [fossil fuels].
“And yet, temperature-wise, that’s exactly the same thing as having a source of methane that’s declining by 3% per decade.”
Climate ambition
Another criticism around the use of GWP* is that countries or companies with high agricultural methane emissions could use the metric to make small emission reductions appear larger.
Dr Donal Murphy-Bokern, an independent agricultural and environmental scientist, believes that the metric can be used as a “get-out-of-jail-free card for methane emitters”. He adds:
“It’s all about saying carry on as we are; we’ll manage this by slightly reducing our emissions over a critical period in history, so as to appear at that critical period in history to be so-called ‘climate-neutral’.”
Mitloehner disagrees with this, noting that, while reductions in methane emissions appear significant under GWP*, increases also appear significant. He says:
“It is simply not true that GWP* is a get-out-of-jail-free card. It’s not. If you reduce emissions, it makes your contributions look less. If you increase emissions, it makes your contributions much worse.”
Rogelj says he has not seen GWP* being used to advocate for the “highest possible ambition” in cutting methane emissions.
However, Allen says that “no metric tells you what to do”. He adds:
“How you measure emissions and how you measure warming has absolutely no bearing on whether you think a country has an obligation to undo some of the damage to the climate they’ve caused in the past.
“This is where the ‘free-pass’ argument makes no sense to me, because the existence of a method to calculate the warming impact of your emissions allows you to make decisions about emissions in light of their warming impact, sure, but it doesn’t tell you what the outcomes of those decisions should be.”
Allen adds that the livestock sector is “unsustainable globally”, with animal numbers and methane levels still rising.
The chart below shows how atmospheric methane concentrations have increased in recent decades.
Allen tells Carbon Brief:
“Do we need to eliminate livestock agriculture to stop global warming? No…[but] we do need to start decreasing it. And if we can decrease it faster than 3% per decade then that would help reduce warming that’s caused by other sectors or, indeed, undo some of the warming that the livestock sector has caused in the past.”
Mitloehner says considerations on the fairness of using GWP* are “real from a policy standpoint and they have to be addressed from a policy standpoint”. He adds:
“But, from a scientific standpoint – and that’s where I’m coming from – I think it’s not controversial.”
Baseline and historical emissions
The baseline year from which emissions reduction targets are set is significant, as it helps form the scope of climate ambition.
For example, high-emitting countries, such as the UK, have set 1990 as their baseline year for emissions-cutting targets, whereas many low-emitting countries may choose further back or more recent years, depending on their needs. Rogelj says:
“Because GWP* translates a change in emissions into either an instantaneous emission or instantaneous removal of CO2, your starting point becomes really important.
“If you start with very high emissions of methane and you did not in any way account for this high starting point, then even very minor, unambitious reductions in methane would result in creating credits for high-polluting countries.”
However, he notes that this is just one way of applying the metric and that there could be ways to avoid this “inequitable outcome”, such as applying GWP* globally and allocating each country a per-capita methane budget, instead of assessing based on national current or past emissions. (Rogelj and Prof Carl-Friedrich Schleussner discussed other possible GWP* equity measures in a 2019 study.)
The chart below, adapted from that study, shows how GWP* can significantly change the per-capita methane emissions of different countries. Some countries with high agricultural methane emissions, such as New Zealand, change from high to low per-capita emitters.
A 2025 study used a climate model to quantify future national warming contributions for Ireland under different emissions scenarios and found that “no additional warming” approaches, such as GWP*, are “not a robust basis for fair and effective national climate policy”.
Discussing baseline concerns, Allen says these considerations are the same for any other metric:
“It depends on how much account you want to take of [the] warming you’ve caused in the past – and at what point you want to take responsibility for the warming your actions had caused.”
He believes that most climate experts agree that it is good to understand the impact emissions have on global temperatures, but “where the controversy arises is about what you consider someone’s nominal emissions to be today”. He adds:
“This is where everybody gets upset, because if you use GWP*, then a livestock sector that’s reducing its emissions by 3% per decade – which most global-north livestock sectors are doing – it looks like their emissions are quite small.
“But that’s only a problem if you think that the main issue is working out whose fault global warming is, rather than working out what we should do about it.”
Communication
Many experts Carbon Brief spoke to took issue with how GWP* has been discussed by some of its proponents.
Murphy-Bokern criticises how Mitloehner and other experts communicate the metric. He says:
“The confusion arises from the activities of Mitloehner, in particular, where he presents the farming community – and the industry in general – with the idea that you can magic away the warming effect of methane simply by looking at the rate of change of methane emissions.”
Mitloehner says he has no regrets about his communication of GWP*, adding that he has “always emphasised to the livestock sector that reductions of methane are important”. He tells Carbon Brief:
“I’m proud because I have been able to take the livestock sector along with the understanding that reductions are needed and that they can be part of a solution if they understand that.”
The New York Times reported in 2022 that the research centre led by Mitloehner at the University of California, Davis “receives almost all its funding from industry donations and coordinates with a major livestock lobby group on messaging campaigns”. Other reports note his discussions about GWP* with stakeholders in various countries.
In response to these reports, Mitloehner says he believes it is important to work with the sector you are researching, adding that he receives both public and private funding. He tells Carbon Brief:
“The problem is not that they [the meat industry] are investing in research and communications and extension. The problem is that they are not putting in enough, because the public sector is withdrawing from this.
“Climate research is being slashed…If the government is not paying into research to quantify and reduce emissions – and those people who are critical of what we do say ‘oh, industry shouldn’t do it’ – then, I ask you, who should?”
Colin Woodall, the chief executive of the National Cattlemen’s Beef Association, a US lobby group, said in 2022 that GWP* is the “methodology we need to make sure everybody is utilising in order to tell the true story of methane”, Unearthed reported. According to the outlet, he added:
“We’re working with our partners around the globe to ensure that everybody is working towards adoption of GWP*.”
Asked if he regrets anything about his communication of GWP*, Allen tells Carbon Brief:
“When we first introduced this – and, perhaps, this is one thing I do regret – I was, perhaps, a little naive in that I thought everybody would seize on focusing on [the] warming impact because it was, from a policy perspective, potentially much easier for the agricultural sector.
“I thought that this would actually be welcomed. But, sadly, it’s not been. And I think part of that is because of this narrative of blame.”
Do any countries currently use GWP* to measure methane emissions?
GWP* is not yet used by any country in methane emission reporting or targets. But it has been considered by New Zealand, Ireland and other nations with high agricultural emissions.
A 2024 statement from dozens of NGOs and environmental organisations called for countries and companies not to use GWP* in their greenhouse gas reporting or to guide their climate mitigation policies. They wrote:
“The risks of GWP* significantly outweigh the benefits.”
New Zealand
New Zealand is currently considering changing its biogenic methane target, including applying the “no additional warming” approach used in GWP*. If it does so, it could become the first country to adopt GWP*.
The nation is a major livestock producer and agriculture generates nearly half of all its greenhouse gas emissions.
The chart below shows that the agricultural sector is also responsible for more than 90% of the country’s methane emissions.
New Zealand has a legally binding target to reach net-zero greenhouse gas emissions by 2050. However, biogenic methane has separate targets to reduce by 10% by 2030 and by 24-47% by 2050, compared to a baseline of 2017 levels.
In late 2024, a review from the nation’s Climate Change Commission recommended that the government change its 2050 greenhouse gas targets, including to increase the biogenic methane goal to a 35-47% reduction by 2050.
At the same time, an independent panel commissioned by the New Zealand government reviewed how the country’s climate targets would look under the “no additional warming” approach.
The resulting report, which did not look specifically at GWP*, but used a similar concept, found that a 14-15% cut in biogenic methane by 2050 would be “consistent with meeting the ‘no additional warming’ condition”, under mid-range global emissions scenarios that keep temperatures below 2C.
The government is “currently considering” these findings, a spokesperson for the Ministry for the Environment tells Carbon Brief in a statement.
The spokesperson says that the report is “part of the body of evidence” that the government will use in its response to the Climate Change Commission’s review, which it must publish by November 2025.
Cain, the Cranfield University lecturer who co-created GWP*, wrote in Climate Home News in 2019 that New Zealand reducing biogenic methane by 24% would “offset the warming impact” of the rest of the country’s emissions, adding:
“New Zealand could declare itself climate-neutral almost immediately, well before 2050 and only because farmers were reducing their methane emissions. That’s a free pass to all the other sectors, courtesy of New Zealand’s farmers.”
A report on GWP* by the Changing Markets Foundation found that, in 2020, 16 industry groups in New Zealand and the UK “urged” the UN’s Intergovernmental Panel on Climate Change to use GWP* to assess warming impacts.
Australia
The Guardian reported in May 2024 that Cattle Australia, a cattle producer trade group, was “lobbying the red-meat sector to ditch its net-zero target in favour of a ‘climate-neutral’ goal that would require far more modest reductions in methane emissions”.
Cattle Australia’s senior adviser and former chief executive, Dr Chris Parker, tells Carbon Brief in a statement that the organisation is “working with the Australian government to ensure methane emissions within the biogenic carbon cycle are appropriately accounted for in our national accounting systems”. He adds:
“We believe GWP* offers a more accurate way of assessing methane’s temporary place in the atmosphere and its impact on the climate. Australian cattle producers are part of the climate solution and we need policy settings to enable them to participate in carbon markets.”
Australia’s Department of Climate Change, Energy, the Environment and Water did not respond to Carbon Brief’s request for comment.
Ireland
Internal documents assessed for the Changing Markets Foundation’s GWP* report “suggest” that Ireland’s Department of Agriculture, Food and the Marine has advocated for GWP* “at the international level”, including at the UN’s COP26 climate summit in 2021.
Allen and Mitloehner were involved in a 2022 Irish parliamentary discussion on methane, in which Allen advocated for the country to “be a policy pioneer” by using GWP* in its methane reporting alongside standard methods.
The country’s coalition government, formed earlier this year, pledged to “recognise the distinct characteristics of biogenic methane” and also “advocate for the accounting of this greenhouse gas to be re-classified at EU and international level”.
A spokesperson for Ireland’s Department of Agriculture, Food and the Marine tells Carbon Brief that this does not refer to using GWP* specifically. They say the country is “in favour of using accurate, scientifically validated and internationally accepted emission measurement metrics”, adding:
“It is important that the nature of how biogenic methane interacts in the environment is accurately reflected in how it is accounted for. This does not mean the use of the metric GWP*.”
In December 2024, Ireland’s Climate Change Advisory Council proposed temperature neutrality pathway options to the government that do not specifically refer to GWP*, but use the same concept of no “additional warming”.
The Irish Times reported that this was “in part to reduce potential disruption from Ireland’s legal commitment to achieve national ‘climate neutrality’ by 2050”.
The climate and energy minister, Darragh O’Brien, said he has “not formed a definitive view” on this, the newspaper noted, and that expert views will feed into ongoing discussions on the 2031-40 carbon budgets, which are due to be finalised later in 2025.
In an Irish Times opinion article, Prof Hannah Daly from University College Cork, described the temperature neutrality consideration as “one of the most consequential climate decisions this government will make”. She wrote that the approach “amounts to a free pass for continued high emissions” of livestock methane.
Paraguay
Paraguay mentioned GWP* in a national submission to the UN in 2023 after agribusiness representatives “pushed” to adopt the metric, according to Consenso, a Paraguayan online newsletter.
The country’s National Directorate of Climate Change told Consenso for a separate article related to GWP* that it is “aware” of questions around the metric, but that it “has the option of using other measurement systems” for emissions reporting.
UK
The National Farmers’ Union, the main farming representative group in England and Wales, is in favour of using GWP* to measure agricultural methane emissions.
Carbon Brief understands that the UK government is not currently considering using GWP* in addition to, or instead of, GWP100 in its emissions reporting.
What do experts think about the use of GWP*?
Most experts Carbon Brief spoke to agreed that GWP* could be a useful metric to apply to global methane emissions, but that it is difficult to apply equitably in individual countries or sectors. Rogelj believes that are are some contexts in which GWP* could be used, but adds:
“You cannot just take targets that were set and discussed historically with one greenhouse gas metric in mind – GWP100 under the UNFCCC [United Nations Framework on Climate Change] and the Paris Agreement and all that – [and] then simply apply a different metric to it. They change meaning entirely.
“So, if one would like to use GWP*, one should build the policy targets and frameworks from the ground up to take advantage of the strengths of that metric, but also put in place safeguards that ensure that the weaknesses and limitations of that metric do not result in unfair or undesirable outcomes.”
A 2022 study says that using GWP* in climate plans “would ask countries to start from scratch in terms of their political target setting processes”, calling it a “bold ask” for policymakers.
It adds that achieving net-zero emissions, as measured with GWP*, “would only lead to a stabilisation of temperatures at their peak level”.
However, a 2024 study found that GWP* gives a “dynamic” assessment of the warming impact of emissions that “better aligns with temperature goals” than GWP100, when measuring methane emissions from agriculture.
Allen believes that criticism over the use of GWP* is similar to “saying it’s a meaningless question” to consider the warming impact of a country or company’s actions. He adds:
“That seems a very strange position to me, because we need to know how different activities are contributing to global warming because we have a temperature target.
“In saying GWP* is a bad thing, what people are actually saying is it’s a bad thing to know the warming impact of our actions, which is a very strange thing to say.”
He says that such metrics help countries to make informed decisions on climate action, but that “we can’t expect metrics to make these decisions for us”.
Murphy-Bokern notes that GWP* could be useful in modelling global, rather than national, methane emissions to avoid high-emitting countries making small methane cuts to achieve “no additional warming”, rather than significantly reducing these emissions.
He says the metric would be particularly useful if global emissions were close to zero, as a way to target the final remaining emissions. But, he adds:
“We are so far away from that very happy situation, that the discussion now with GWP* is a huge distraction from the key objective, which is to reduce emissions.”
Mitloehner – and every expert Carbon Brief spoke with – agrees with this wider point. He says:
“The main point is we need to reduce emissions. In the case of livestock, we need to reduce methane emissions. And the question is how do we get it done? And how do we quantify the impacts that [that reduction] would have accurately and fairly? The other issues are issues that politicians have to answer.”
The post Q&A: What the ‘controversial’ GWP* methane metric means for farming emissions appeared first on Carbon Brief.
Q&A: What the ‘controversial’ GWP* methane metric means for farming emissions
Several major banks that helped set up the UN’s now-defunct Net-Zero Banking Alliance (NZBA) in 2021 have since continued to lend money to coal companies, a new report has revealed.
Bank of America, Barclays, Citibank, Deutsche Bank and Santander were heavily involved in the NZBA and the associated Glasgow Financial Alliance for Net Zero (GFANZ) when it was launched by Mark Carney, then a UN climate envoy and now Canada’s leader, in the run-up to the COP26 climate summit in Glasgow.
Despite their involvement, data released this week shows those banks and some others did not reduce the amount of money they lent, nor the value of their underwriting, to coal activities between 2022 and 2025. Around half of the NZBA members who were engaged in coal financing over that time increased it and half cut it, according to the report by German environmental research group Urgewald.
Ana Botín, executive chair of Santander, was a member of the GFANZ CEO principals’ group and said at the time of the NZBA launch that her Spanish bank was “proud to be part of the founding members of this new alliance and to accelerate progress towards net zero”.
Since then, the report’s data documents that Santander has provided loans and underwriting worth hundreds of millions of dollars each year to coal companies, particularly American coal-power plant operators Duke Energy and the Southern Company. Santander did not respond to a request for comment.
Urgewald’s research adjusts the value of loans and underwriting provided to coal companies based on how much of a company’s revenues come from the most polluting fossil fuel. So a hypothetical $100 million loan to German utility RWE is valued at $21 million, as 21% of RWE’s revenue is from coal.
The research does not take account of whether companies are expanding their coal business or phasing it out for greener alternatives. Some banks have said their coal clients need to put in place transition plans by a certain date. Some also say that, by a certain date, they will stop lending money to clients that get more than a set percentage of their revenue from coal.
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Most companies expanding coal are in Asian nations like China, India and Indonesia and are largely financed by banks from their own countries. But there are examples of NZBA founding members supporting companies that are actively prolonging the life of their coal businesses.
For example, Glencore, a Switzerland-based multinational that gets 4% of its revenue from coal, has just won preliminary regulatory approval to keep on coal mining in Australia’s Hunter Valley until 2045. Last year, the company was supported by loans and underwriting from Bank of America, Citigroup, Santander, Barclays, Deutsche Bank, HSBC and Standard Chartered.
Good and bad news
Some NZBA founding members like Swiss giant UBS have reduced their loans and underwriting for coal companies, the data suggests. Others – like Triodos and Kenya Commercial Bank – have provided no support for coal companies since at least 2021.
Urgewald researcher Hannah O’Neill told Climate Home News that “the banking sector is not moving in one direction. There is a growing divide between banks that are tightening their coal policies and reducing their exposure, and those where coal policies remain weak or where financing continues.”
Unlike the UN’s Race to Zero campaign, with which it partnered, the NZBA did not require its members to end financing for fossil fuels like coal, leading to accusations by climate campaigners that its rules were too weak.
Despite this, after Donald Trump’s re-election as US president in November 2024, several North American banks quit the alliance and the NZBA’s requirements were diluted in April 2025. After further withdrawals, the group shut itself down in October 2025.
Globally, the Urgewald report found that many banks in the European Union, Thailand, Malaysia, India and Taiwan have reduced their coal finance since governments agreed at COP26 to phase down coal power.
But with Chinese, American, Indonesian and South Korean banks increasing their support, total bank financing for the coal industry has remained broadly the same each year since 2022.
“Coal financing is not disappearing – but it is concentrating in banks and markets where coal policies are either missing or weak,” said Heffa Schücking, director of Urgewald.
Urgewald’s definition of coal companies includes firms and their subsidiaries that explore for, process, trade, transport and mine coal, or burn it in power plants to produce electricity, or manufacture equipment for the coal industry. It does not include companies that use coal to make cement or steel – and an adjustment is made to account for how much of the business model is coal-related.
Banks defend delays
At the time of publication, most of the banks named in the report for increasing their coal finance had not responded to requests for comment. But a spokesperson for Deutsche Bank pointed Climate Home News to its May 2026 announcement that it was delaying its requirement for existing clients to present it with transition plans and cut their coal exposure.
Instead of having to present these plans by the end of 2025, the bank has given them until the end of 2027. They will also have to ensure that their revenue share from thermal coal falls below half by then, the bank added. New clients need energy transition plans to access finance.
Deutsche Bank said at the time it was delaying its requirements because of the “increasingly complex regulatory environment as well as differing speeds of energy transition in various regions beyond what was anticipated by Deutsche Bank in 2023”.
Big banks’ lending to coal backers undermines Indonesia’s green plans
A spokesperson for Barclays told Climate Home News: “Many companies in this report are diversified energy or mining companies. We do not provide financing to companies that generate more than 30% of revenues from thermal coal mining or power generation, and we will phase out all financing by 2035.”
The Barclays spokesperson added: “Barclays is financing an energy sector in transition, providing finance to meet current energy needs and also financing the scaling of clean energy. Over the past three years, we have facilitated more than $300 billion of sustainable and transition finance, including billions to cleaner energy projects, and invested millions into climate tech.”
The post Big banks behind “net zero” alliance continued lending to coal firms appeared first on Climate Home News.
Big banks behind “net zero” alliance continued lending to coal firms
Harjeet Singh is the global convenor of the Fill the Fund campaign and founding director of the Satat Sampada Climate Foundation. Julie-Anne Richards is strategic campaign lead for the Make Big Polluters Pay campaign in Australia.
This year, a glacier collapse in Nepal’s Himalayan valleys swept away the lives of at least 1,500 people, with recovery costs of US$5 billion, or 10% of national GDP. But this was not a tragedy for which no one can be blamed. This was a crime with a balance sheet – one whose costs are paid by people who did nothing to cause it, and whose profits are booked by polluting corporations that did everything.
Across the Pacific, the calculation of injustice is now brutally clear. According to Oxfam Australia, the average yearly GDP loss of Pacific countries from climate disasters has increased four-fold over the last decade, reaching 14.3% of GDP. The number of Pacific people battered by climate disasters has risen by 700% in a decade. Whole villages are being packed up and moved as the sea takes the land beneath them.
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What’s on the climate calendar for October 2026?
Brazilians are heading to the polls, diplomats are gathering in the Pacific for Pre-COP, and it’s crunch time for the IPCC
Let’s look at the other ledger. This year, as climate change and an oil shock drove up the cost of living for ordinary families, Woodside – touted as “one of Australia’s biggest winners” from the war in the Middle East – reported revenues jumping nearly 30% to AUD$6 billion in just three months.
In Australia, Oxfam finds that in 2023-2024, fossil fuel corporations paid only AUD$22.8 billion in corporate income tax – just 5% of their AUD$436 billion in total reported income – while 26 out of 80, or one in every three large fossil fuel corporations, did not pay corporate income tax at all.
The polluters are not struggling to pay for the damage they cause. They are choosing not to.
This is the moral obscenity at the heart of the climate crisis: the money exists. It is simply flowing in the wrong direction. And nowhere is that clearer than in the funds the world built to protect the vulnerable, now left to languish.
Funds struggle to fill their coffers
The Fund for Responding to Loss and Damage (FRLD) has received US$2.8 billion in requests from 119 countries. And Nepal has sought an urgent US$20 million for immediate needs. Yet the Fund has only US$342 million in total to give.
The Pacific Resilience Facility – a fund the Pacific designed for itself, to prepare its own communities – sits well short of even its modest US$500 million capitalisation target. And the Adaptation Fund is running on empty. While adaptation needs in developing countries could reach US$387 billion a year by 2030, according to the latest UNEP Adaptation Gap report, the Fund’s resource mobilisation target of a modest US$300 million for 2025 fell far short, with only US$135 million pledged.
This is a matter of priorities, not of resources. For decades, the world has accepted a simple principle – the polluter pays principle – whether through the OECD, of which Australia is a member, or Europe’s carbon pricing. New York and Vermont have already passed laws to make Big Oil pay into climate superfunds, and ten more US states are moving to follow.
The idea is neither radical nor new. It’s time to make big polluters pay.
Comment: After Hormuz, Nepal and wildfires, people want action to make polluters pay
What is urgently needed is the courage to apply it to the fossil fuel corporations that have spent decades avoiding it. In November, Australia takes up the presidency of the COP31 negotiations, committing to stand shoulder to shoulder with its Pacific neighbours.
Australia, together with the Turkish COP31 Presidency, must guide and inspire progress at the upcoming climate conference, including on new climate finance pledges by developed countries (which agreed to mobilise at least $300 billion by 2035) and triple the funds available to the FRLD, the Adaptation Fund and the other UN climate funds.
Rich countries agreed to these goals two years ago at COP29. Yet, the reality is that developing countries’ need for climate finance is in the trillions annually, while developed countries continue to delay providing even what they have already committed. A clear signal recognising the importance of delivering the promised climate finance must come at next week’s Pre-COP in the Pacific, and COP31 in Antalya must go on to deliver against existing promises or risk an irreparable breakdown in trust.
Time for a climate pollution levy
Countries must also ensure funding for loss and damage takes its rightful place as the third pillar of climate finance, alongside mitigation and adaptation, in negotiations regarding the UNFCCC climate finance work programme and Article 9 on shifting finance flows towards a low-carbon, resilient world.
Australia, as President of Negotiations and as a Pacific nation, cannot ask the world to fill these funds while it lets its own coal and gas giants off the hook. Australia should not only stop approving new and expanded coal and gas mines, it should also introduce a Climate Pollution Levy on big coal, oil and gas corporations – a charge on every tonne of carbon pollution they extract and profit from. Independent analysis shows such a levy could raise tens of billions of dollars a year, and can be designed so the cost falls on the corporations, not on households.
This is not charity – it is compensation. It is the beginning of accountability. And the public is far ahead of its leaders: eight in 10 people worldwide, and a clear majority of Australians, want fossil fuel firms taxed to pay for the damage they cause.
Fossil fuel expansion threatens COP31 hosts’ credibility, experts warn
The money must go where the harm lands. A Climate Pollution Levy should feed the funds frontline communities are relying on – fully capitalising the Pacific Resilience Facility this year, replenishing the Adaptation Fund, and delivering the billions the loss and damage fund needs.
It is essential for these funds to be able to provide grant-based finance that reaches communities directly, not more loans that push drowning nations deeper into debt. With Nepal’s recovery costs estimated at around 10% of the country’s GDP, if we leave it to fend for itself without loss and damage funding, Nepal will likely be saddled with debt and could fail to recover adequately, increasing poverty and inequality.
We have heard enough empty pledges. We have watched enough funds announced with fanfare, only then to be starved in silence. The era of asking polluters politely is over. Australia, as COP31 president, has a rare chance to prove that the polluter pays principle means something and apply it to those who have profited the most.
The post As COP31 co-host, Australia should make its polluters pay for climate damage appeared first on Climate Home News.
As COP31 co-host, Australia should make its polluters pay for climate damage
This is a republication of October’s edition of The Climate Agenda – a subscriber-only newsletter designed to keep you informed of the key events, negotiations and announcements happening every month. If you want to receive The Climate Agenda straight to your inbox at the start of each month, sign up as a subscriber today.
This month, we’ll be on the ground reporting from the Convention on Biological Diversity summit in Yerevan, Armenia later this month and following all the developments as we build towards COP31 in Antalya, Türkiye next month. Here’s what you need to know for October, why it matters and what to expect.
Brazilian Election
First round: Sunday 4 October – Second round: Sunday 25 October
This poll is being closely watched by Brazilian environmentalists as it’s likely to make a big difference to Brazil’s international climate politics and the health of the Amazon rainforest.
The two clear front-runners are current left-wing President Lula and right-wing Flávio Bolsonaro. Flávio is the son of Jair Bolsonaro, who ruled from 2019 to 2023 but was declared ineligible to hold public office because of his attacks on the electoral system and is now under house arrest.
In the unlikely event that either candidate wins more than half the votes in the first round, they will be elected as the country’s leader. Latest polls have Lula on 39% and Bolsonaro on 35% (though the numbers are shifting) with several minor candidates in the single-digits. If none of them get a majority, there will be a one-on-one run-off on October 25.
The Latin American nation is set to record its lowest-ever level of deforestation, as efforts to rein in illegal clearing and restore Indigenous rights progressed under Lula. But Brazilian experts are warning that the huge agribusiness lobby in Congress, whose interests shape what happens in the Amazon, will be emboldened if Bolsonaro takes power, with the Supreme Court also risking a turn to the right.
As for climate politics, some seasoned watchers fear that Flávio – a climate change denier like his dad – could even try to pull Brazil out of the Paris Agreement. That would leave other countries to take forward Brazil’s COP30 global roadmaps on transitioning away from fossil fuels (TAFF) and ending deforestation – both of which are due to be delivered by COP31.
For Brazil’s own TAFF roadmap – commissioned earlier this year but so far nowhere to be seen – the election may have less of an impact, given Lula is as keen as any other politician to extract oil and gas from the Amazon, amid cross-party support for fossil fuel production.
Read more: Brazil leads “encouraging” decline in global rainforest destruction in 2025
Pre-COP
Monday 5 October – Thursday 8 October – Fiji and Tuvalu
The annual Pre-COP meeting is usually a business-like gathering of government negotiators, sounding out each other’s positions and laying the groundwork for deals at the main COP summit. But this year’s “pre” has been jazzed up by Australia’s partnership with Pacific governments keen to elevate their climate issues on the international stage.
“We will bring the eyes of the world to our region, highlight the threat that climate change poses to it, and show how Pacific voices are shaping global action to counter it,” Australian PM Anthony Albanese said of the event.
On Monday, before the Pre-COP officially starts, a group of senior government figures – including a handful of leaders – will visit the world’s second lowest-lying nation Tuvalu, as UN boss Antonio Guterres did in 2019.
They will visit areas affected by sea level rise, see climate resilience projects and meet local communities before flying 2.5 hours south to Fiji to join up with the Pre-COP – which starts on Tuesday – and speak at a “Leaders’ plenary session” that evening.
The Pre-COP runs until Thursday. Governments are expected to try to advance on some kind of a roadmap for protecting oceans from climate change, while Fiji says Pacific nations will emphasise the need to follow science and step up efforts to limit warming to 1.5C.
Australia is also due to present an action plan to improve access to climate finance for small island nations and least-developed countries, so that governments, development banks and climate funds can endorse it ahead of the Antalya summit.
Alongside the official Pre-COP discussions, a “green zone” will host talks organised by civil society on topics like public transport, carbon markets and the International Court of Justice advisory opinion. Unfortunately, these events won’t be available to follow online.
Read more: Threatened by rising seas, small islands secure right to keep their statehood
Read more: At regional summit, Pacific islands ask for COP31 support for clean energy and finance
Article 6.4 Supervisory Body
Monday 5 October – Friday 9 October – Bonn, Germany
The UN carbon market’s rule-making body meets for one last jam-packed session ahead of COP31, with decisions pending on several high-stakes issues that could shape the future of the new crediting mechanism.
Top of the agenda is a rulebook for clean cooking projects, which aim to cut greenhouse gas emissions by distributing more efficient cookstoves. These projects generate some of the most popular carbon credits but have also drawn some of the heaviest criticism for overstating their climate benefits through lax accounting.
Technical experts have recommended the Supervisory Body tighten the rules compared to existing crediting programmes, including by forcing cookstove project developers for the first time to guard against the risk of the climate benefits of their credits – the trees saved from becoming cooking fuel – being wiped out by fire, drought or logging.
The proposal on the so-called reversal risk assessment has sparked a “coordinated” lobbying campaign from the industry, some conservation NGOs and UNEP, arguing that stronger protections could hike project costs and restrict the supply of credits.
Read more: Industry and NGOs lobby to weaken UN carbon credit rules in “coordinated” push
Intergovernmental Panel on Climate Change (IPCC) plenary
Monday 12 October – Friday 16 October – Addis Ababa, Ethiopia
Scientists and government officials will try, once again, to agree on a timeline to produce the highly influential AR7 assessment report from the UN’s climate science body.
The faultlines that have blocked a deal at several previous sessions are well established: a large group of predominantly developed countries, small island and progressive Latin American states and the poorest nations want the reports to be ready in time to inform the UN’s next global assessment of climate action, due to be completed in November 2028.
A small group of primarily big emerging economies disagree, claiming this timeline would put a burden on developing countries with limited resources and restrict their ability to provide scientific input into the process.
Three options will be on the table in Addis Ababa. Two of them would see all three flagship assessment reports approved by July 2028 and September 2028 respectively, just in time to feed into the second Global Stocktake.
The third, based on proposals from Saudi Arabia and India, would deliver only the Working Group 1 report, on the physical science of climate change, by May 2028. The reports from Working Groups 2 and 3, covering climate impacts and ways to cut emissions, would not be approved until mid-2029, well after the stocktake concludes at COP33.
Delegates are also expected to discuss the IPCC’s increasingly strained budget, made worse by a funding gap left by the withdrawal of the United States. The panel has warned that, without a sustained increase in contributions, its trust fund’s cash balance would run out by the end of 2028, putting the delivery of the AR7 set of reports at risk and forcing cuts to in-person meetings, translation and outreach.
Read more: Science ‘under attack’ from fossil fuel interests at UN climate talks
Read more: As science comes under attack at UN talks, climate movement splits over how to respond
World Bank & IMF Annual Meetings
Tuesday 12 October – Sunday 18 October – Bangkok, Thailand
With their biggest shareholder – the US – resolutely opposed to climate action, the World Bank and International Monetary Fund (IMF) are likely to try to avoid mentioning climate change at their annual meetings in Bangkok – and there are no headline events on the subject.
But they aren’t in complete control of the agenda. Thailand will host a discussion on financing a green resilient economy and World Bank President Ajay Banga is likely to be challenged on climate at a live-streamed civil society townhall on October 12.
With tricky negotiations on the World Bank’s climate finance target concluded earlier this year (it was dropped), talks are moving on to the sustainability framework of the World Bank’s International Finance Corporation, which invests in the private sector. Civil society is calling for its rules on protecting people and the planet to be maintained and strengthened.
The IMF’s guidance note to staff – which shapes the circumstances under which climate can be included in IMF programmes – will also be negotiated. Longer term, the Resilience and Sustainability Trust, which channels funding to green projects, will be reviewed but not before 2028 at the earliest.
Read more: World Bank’s climate work can endure without finance target, experts say
Convention on Biological Diversity (CBD) COP17
Monday 19 October – Friday 30 October – Yerevan, Armenia
The biodiversity COP – a sister convention to the UN climate process – will for the first time take stock of progress towards key goals in its 2022 landmark agreement, the Global Biodiversity Framework (GBF). These include a headline target to protect and conserve at least 30% of the planet’s land and marine ecosystems by 2030.
A draft report prepared by a scientific panel warns that “unless collective implementation accelerates rapidly, the 2030 targets and mission will not be achieved”. In fact, governments are failing on 22 out of 23 targets. The final report is expected to be published ahead of COP17, where governments are expected to react strongly.
UN biodiversity chief Astrid Schomaker told journalists earlier this month that the most significant progress is expected to occur towards the end of the decade, as 174 countries took the first four years to develop national targets.
Finance, meanwhile, is set to become a contentious issue, as the draft report says developed countries fell short on a target to provide $20bn per year in international public finance for nature protection, reaching only about $17bn per year from 2020 to 2023. They have also yet to meet a wider goal to mobilise $200bn per year counting all kinds of finance.
Much like in climate talks, the EU has proposed to broaden the base of donors to include emerging economies who want to “voluntarily assume the obligations” of developed countries. Saudi Arabia and Qatar want nothing to do with this proposal. China has said bringing in new contributors should not weaken the obligations of developed countries. Expect a fight in Yerevan.
A preliminary meeting in Nairobi in August resulted in a heavily bracketed text that delegates will have to unravel in Armenia. One observer said countries had “overall missed the level of urgency” needed.
Keep an eye out for our webinar live from Yerevan later this month, where we’ll provide an update on the talks and how governments are responding to science’s demands for quicker action.
Read more: Mombasa ocean summit drives progress on marine protection, but threats persist
Read more: UN biodiversity talks agree finance roadmap, postponing decision on a new fund
European Climate Resilience & Risk Management Framework
Wednesday 28 October – Brussels, Belgium
Following a torrid summer beset by recurring heatwaves, drought and outbreaks of forest fires across the continent, the European Commission will present its keenly awaited climate resilience and risk management framework to help member states protect their populations from worsening climate change impacts.
As part of the policy package, the Commission will identify 100 of Europe’s most climate-vulnerable territories. And alongside an assessment of the risks, there will be guidance at which level they should be managed – regional, national or by the EU. Currently, confusion often arises over who is responsible for preventing, preparing for and managing disasters across the bloc.
The framework will also aim to make Europe a “champion in adaptation technologies” – such as drought-resistant crops, flood prevention or energy-efficient cooling – which have been described by EU President Ursula von der Leyen as “a huge emerging market”.
With only around a quarter of catastrophe losses in Europe covered by private insurance, the Commission also plans to set up a Climate Insurance Alliance to boost that figure.
READ MORE: WHO issues new guidance on heat-health action plans, as El Niño sets in
The post What’s on the climate calendar for October 2026? appeared first on Climate Home News.
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