Bank of America Cuts Mountaintop Coal Loans
Bank of America has given in to pressure from one of the nation’s most powerful environmental groups. After bank executives were taken for a tour of the mountaintops by the Natural Resources Defense Council, the bank pledged to cut off financing for the coal operations.
“Bank of America is particularly concerned about surface mining conducted through mountain top removal in locations such as central Appalachia.,” the bank said in a statement. “We therefore will phase out financing of companies whose predominant method of extracting coal is through mountain top removal.”
This move by the top U.S. bank comes as a financial blow to the coal mining industry just after the Bush administration made it easier for coal companies to dump debris from mountaintop mining into nearby valleys and streams.
“I think it will send a shock wave through the coal industry, because they’ve been able to do this for a long time on the cheap,” said National Resources Defense Council campaign director Robert Perks.
Mountaintop mining accounts for about 10% of U.S. coal production.
The bank acknowledged the effect it may have on jobs in the industry, “while we acknowledge that surface mining is economically efficient and creates jobs, it can be conducted in a way that minimizes environmental impacts in certain geographies,” the bank added in its statement.
National Mining Association spokesman Luke Popovich said U.S. coal production, stoked by overseas demand, had been set to hit a record in 2008, before the economy soured.
“It would be hard for me to believe the bank fully appreciates the employment that depends on mountaintop mining in Appalachia,” he said.