Russia central bank to ease requirements for banks backing green projects
MOSCOW, Nov 30 (Reuters) - Russia's central bank plans to ease capital requirements for banks that lend money to eco-friendly projects and raise them for those giving loans to firms that do not disclose their ecological impact, First Deputy Governor Ksenia Yudaeva said.
Russia is the world's fourth-largest emitter of greenhouse gases and relies heavily on fossil fuel exports - but President Vladimir Putin has ordered the government to work towards cutting emissions.
The Bank of Russia will take climate risks into account when making regulatory decisions on so-called green and less eco-friendly "brown" projects, Yudaeva told Reuters in an interview.
The proposed adjustments to banks' capital requirements would be the first step in a series of regulatory changes, Yudaeva said without giving more details or saying when any of them would come into effect.
The development of green financing instruments should help Russian companies attract extra investment, including from abroad, Yudaeva said.
"We see aspiration from Russian companies to increase their ecological performance as they understand that it gives more options to sell their produce," she said.
Russia's plan to reduce its carbon footprint by 2050 will require investments of between 1 trillion roubles and 4 trillion roubles a year ($13.4 billion to $53.6 billion), the central bank has said.
Russia's largest companies on average channel less than 1% of revenues into ecology-related projects, compared with more than 2% invested by their foreign peers, Yudaeva said.
The central bank has recommended companies disclose information on their environmental progress and is now planning to send similar recommendations to banks, she added.
Climate change poses a serious challenge for the Russian economy which relies heavily on oil and gas production, as well as mining. Some of that infrastructure is built on permafrost, which is vulnerable to rising temperatures.
Reporting by Elena Fabrichnaya; Writing by Andrey Ostroukh; Editing by Andrew Heavens
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