The energy supply financing ratio is a key metric to assess banks’ real support to the energy transition. It compares financing allocated to fossil fuels with financing allocated to sustainable power supply and is expressed in the format “X:1”, where X indicates the amount of monetary units allocated to sustainable power supply for each monetary unit allocated to fossil fuels. A credible energy financing ratio should cover the entire value chain of fossil fuels and include direct financing (such as loans) and indirect financing (such as bond emissions).

For instance, if a bank allocated US$ 210 million to fossil fuels and US$ 420 million to sustainable power supply over the same period, its energy supply financing ratio is 2:1.

Find out more about the 6:1 energy supply financing ratio.