Commonwealth Bank CEO Asserts They Are Not Against Gas in Climate Change Policy
CEO Matt Comyn emphasized that while the bank supported the gas industry, it was crucial to uphold its net-zero commitments.
Australia’s largest commercial bank clarified that it was not “anti-gas” in response to concerns about the impact of its climate change policy on the country’s gas supply.
During a parliamentary inquiry on Aug. 29, representatives from the Commonwealth Bank of Australia (CBA) faced questions regarding the change in its lending policy for energy companies.
In addition, the bank stated that it would only provide loans to coal, oil, or gas companies committed to the goals of the Paris Agreement on climate change and who had plans to transition away from fossil fuels.
Concerns Over Impacts of CBA’s Climate Change Policy
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“Is the intent of your policy a reduction of investment in gas in Australia?”
In response, CBA CEO Matt Comyn assured that was not the case.
“It’s certainly not the intent. We believe that gas is going to play a very important role for a long period of time,” he said.
Additionally, Comyn acknowledged his company’s awareness of the risk of gas shortages in Australia.
“One of the stakeholders that we meet with is the Australian Energy Market Operator (AEMO). They’ve been calling risks around gas shortfalls [and] the need for [more] infrastructure,” he said.
Pointing to sharp rises (33 percent) in gas prices in the past two years, Hamilton also questioned whether CBA’s climate change policy was out of touch with Australia’s cost of living crisis.
“Should the priority now be more towards reducing the cost of gas in a household?” he asked.
“Should the priority be more towards further investment in gas as is requested by AEMO’s 2024 statement?”
While Comyn acknowledged the need for Australia to ensure energy security and meet its net-zero commitments, he emphasized that these goals were not always aligned.
At the same time, the CEO reiterated that the CBA had the most appropriate policy.
“We are not anti-gas. We are very constructive,” he said.
“We would be prepared to continue to finance that industry, but it has to be consistent.
“We can’t simply waive other commitments that we’ve made, which I think would erode trust.”
A man enters a branch of the Commonwealth Bank of Australia (CBA) in Melbourne, Australia, on Aug. 11, 2021.
William West/AFP via Getty Images
Gas Shortage Forecasts
Comyn’s remarks follow a recent report by the Australian Competition and Consumer Commission (ACCC) indicating that the country could experience gas shortages as early as 2027 if it does not secure new supply sources.
While the report predicted that there would be sufficient supply to meet demand in the east coast gas market in the short term, it expected the situation to worsen significantly by 2027.
“Forecasts indicate that the East Coast gas market may experience gas supply shortfalls as early as 2027 unless new sources of supply are made available,” the report said.
“This predicted shortfall is likely to take place one year earlier than what previous reports have forecast, with the extended operation of Eraring Power Station improving the outlook for 2027 but not altering the fundamental trajectory of supply.”
The consumer watchdog attributed this to an increase in forecast gas consumption for power generation and a fall in forecast supply due to delays in new gas projects and production issues in legacy gas fields.
With the imminent threat of a gas shortfall, the ACCC urged the government to take immediate action to develop new supply sources.
