Banking in Climate Chaos

Every $1,000 kept in a savings account by Americans each year indirectly produces greenhouse gas emissions equivalent to a flight from New York to Seattle, according to 2023 analysis. When money is deposited into a bank as savings, banks make money by lending these personal deposits to projects by fossil fuel companies, emissions-heavy manufacturing industries and agriculture. In fact, for eleven of the largest US banks, almost 20% of their loans go to carbon-intensive industries.

Atmos Financial, a technology company offering green banking solutions, guarantees that one hundred percent of your savings are used to help finance climate-positive initiatives, such as renewable energy, electric vehicles and environmental conservation. Newsweek's Better Planet spotlights Atmos Financial as a change-making company fighting for a greener future.

Bad Banking

Across the world, major commercial and retail banks use their customers' money to provide loans. This can be for individuals, such as mortgages or private student loans, or loans for big businesses that require large-scale funding for a new project.

In fact, for the top 10 banks in North America, each of them lends between $20 billion and $40 billion to fund fossil fuel projects each year. Within the United States, examples include Plaquemines LNG, a proposed fracked gas export terminal in southern Louisiana that would produce the equivalent greenhouse gas emissions as 42 coal plants, according to The Sierra Club. This project is being funded by major American, Japanese and Canadian banks.

In Virginia, the Mountain Valley Pipeline project is a proposed 303-mile natural gas pipeline system. Oil Change International estimates that the total emissions produced each year by the Mountain Valley Pipeline would be the equivalent to the annual emissions of 26 coal plants. This project is being underwritten by four major American banks.

"We all want to be a part of creating a more beautiful tomorrow," said Pete Hellwig, co-founder of Atmos Financial. "But that's pretty hard if our individual solutions are limited to riding a bike to work."

Since the 2015 Paris Climate deal, the world's biggest 60 banks have provided at least $3.8 trillion in financing for fossil fuel companies, who are by far the largest global contributor to climate change.

A Warming Planet

Research shows that there is no time to waste when it comes to the climate crisis. If we do not keep global temperature rise under 2.7 degrees Fahrenheit – the limit scientists say is necessary for abating the worst effects of a warming climate – the United States risks destabilizing its agricultural industry and water supplies, as well as increasing instances of heat-related illness and intensifying air pollution.

However, President Biden's goal of reducing the US' greenhouse gas emissions to half the levels of 2005 by 2030 looks unlikely to be met.

Despite recent historic investments in renewable energy, which overtook coal and nuclear power in electricity generation in 2022, the United States continues to invest in new fossil fuel projects. Climate Action Tracker notes that reducing the country's emissions to half of their 2005 level would not be sufficient for keeping global temperatures below a 2.7 degrees Fahrenheit increase, and that their current actions and policy changes are "insufficient" for reaching even these national targets.

In particular, US attention towards climate finance – meaning the financial resources that are used to support climate action including "financial flows" of banks – has been labeled as "critically insufficient."

The International Monetary Fund estimates that climate finance globally will have to reach $5 trillion annually by 2030 if we are to achieve goals of net zero emissions by 2050.

"Realistically, only the banking sector has that money to deploy," said Ravi Mikkelsen, fellow co-founder of Atmos Financial.

A Cleaner, Greener Economy

"That's why we created Atmos," said Hellwig, "to really give people the opportunity to create the action they want to see in the economy." Atmos Financial offers individuals the opportunity to decide on the impact their money will have in the global economy. "Though something as simple as everyday banking," Hellwig said, "With few barriers to open an account, Atmos makes climate action attainable for more people."

Savings deposited into Atmos Financial are exclusively used to fund climate-positive initiatives, such as renewable energy and energy efficiency projects. Partnering with over 120 nonprofits and companies, Atmos also supports work by Greenbelt Alliance, Amazon Watch and Organic Farming Research Foundation, among others.

Compared to other green financial solutions, Atmos Financial is the only company of its kind to put 100% of their deposits towards funding decarbonization projects. "We're not greenwashing, we're not saying we're doing this awesome thing, and it turns out we're not," said Hellwig. "We as a society do not have time for that."

Instead, Atmos Financial offers clients the ability to see the individual impact of their savings on the planet. Using the Environmental Protection Agency's Avoided Emissions and Generation Tool AVERT, Atmos can estimate the total amount of carbon emissions saved per dollar deposited in Atmos. As of January 25th, over 153 million pounds of carbon dioxide or equivalent greenhouse gasses have avoided entering the atmosphere due to clean energy projects funded by Atmos' customers. Atmos continues to improve its impact tracking, working on real-time production and local emissions data collection now — giving customers even more insights into the power of their money.

"You don't have to be a homeowner, you don't have to own a car, you don't have to be able to install solar heat pumps," said Mikkelsen. "If you've got $20 in your savings account, we can put those $20 to work."

Atmos Financial has now been recognized by the Global Footprint Network as a "Top 100 Solution to Climate Change." They have expanded their climate initiatives to include a 5% cash-back program when you make a purchase at any one of hundreds of sustainable businesses, as well as the opportunity to double your savings rate when you donate to any one of Atmos' approved climate charities.

Atmos also has a low-cost solar loans program that makes it more affordable to install solar panels on your property. Launched a little more than a year ago, Atmos deposits funded the installation of nearly 12 MW of solar generating capacity in their first seven states of operation.

A Hopeful Future

If you're looking to make a positive change for a positive future, "Atmos is the world's most climate positive banking product," said Hellwig. "Nothing else like this exists." "There is a big problem ahead of us and the solution is a mile out. We're just trying to make it easy for people to take the baby steps," he said.

Baby steps together can create dramatic change. In the United States, Indigenous-led resistance groups, like those supported by Atmos Financial, are stopping pipelines. In the decade leading up to 2019, 21 pipeline projects were prevented or delayed by work from Indigenous groups, saving the equivalent of 400 coal-fired power plants' worth of pollution being released into the atmosphere.

In 2020, solar and wind energy became the cheapest forms of new electricity in most of the world. By 2023, wind and solar energy were cheaper than fossil fuels, according to The Global Electricity Review.

For Atmos Financial, positive initiatives are continuing to be developed. In 2024, they will begin offering a commercial banking product for businesses looking to make a greener impact. "Thinking about the impact of our money on the planet, that is just sitting in the banking sector," said Hellwig, "that's really one of the most powerful things we can do."