Wall Street Banks Are Activists’ New Weapon To Stop Mountaintop Removal In Its Tracks

Environmental activists have had slow going in trying to stop the devastation of mountaintop removal coal mining. For years, they’ve tried to convince investors to divest themselves of shares in the fossil fuel industry in order to slow coal companies down. But a new tactic has recently ratcheted up the level of success activism is achieving.

Mountaintop removal involves bulldozing a mountainside and then planting explosives to completely blow the top off. The deep coal seams that are exposed are much easier to mine than getting at them by digging shafts into the middle of the earth and hauling chunks of coal out in carts. Of course, the denuded mountaintops will remain forever barren. Forests don’t grow on rock.

Appalachia is being literally torn apart by the practice, and has been for decades. Compounding the damage is the method coal companies use to dispose of the “debris” — the rock and earth — from the explosion. They simply bulldoze it into rivers and streams, fouling the water supply and filling in river beds. Earthjustice, a non-profit public interest law group, estimates that more than 2,000 miles of streams and headwaters have been buried.

Lawsuits to enforce the Clean Water Act and pressure on investors to divest are laboriously slow. All the while, mountaintops continue to be blown apart. Recently, however, activists have grown in their sophistication. They’ve taken the battle to Wall Street banks. Massive operations like mountaintop mining involve massive financing. Drying up the companies’ money source is proving to be far more effective — sort of like depriving a tumor of oxygen so that it strangles and dies.

Last week, after five years of pressure from the Earth Quaker Action Team, PNC Bank announced that it would stop funding mountaintop removal. PNC isn’t the largest bank in the country. It’s actually the seventh largest, but it’s one of the largest remaining financiers of coal companies.

Most large banks had already succumbed to the pressure from activists and agreed to stop funding mountaintop removal. According to the New York Times, those in agreement include Bank of America, Citigroup, Morgan Stanley, JPMorgan Chase, Wells Fargo, and Credit Suisse. The only holdouts left are GE Capital and UBS.

Scott Wisor, deputy director of the Center for the Study of Global Ethics at England’s University of Birmingham, described the difference it makes to directly cut off the money rather than work on divestment. Cutting off the money means these companies can’t efficiently mine a large percentage of the coal in the earth. Wiser said:

“The threat to share price from announcing that 80 percent of reserves will not be extracted is exponentially greater than the minor threat posed by a few universities and churches selling their shares in these companies.”

Banks have reputations to protect. When activists took evidence of the destruction, the pollution, and the devastation to people’s lives to the governing boards, banks had to decide whether to be associated with dangerous, morally repugnant practices that would continue to attract publicity. Most of the major banks have replied “No.”

As the funding dries up, the search for new money sources, and the time spent on obtaining them, make mountaintop removal coal mining less and less profitable.

At last, a new day is dawning in Appalachia.

 

Feature photo by Lou Gold, used under Creative Commons 2.o Generic license.