BBVA Expands Decarbonisation Goals to Real Estate, Aluminium

BBVA is increasing its efforts to combat climate change by establishing emission reduction targets for two new sectors: Spanish real estate and global aluminium.

These targets supplement BBVA's existing goals for eight other high-impact industries, such as oil & gas and steel.

"Real estate and aluminum are critical for economic development," said BBVA's Sustainability Head Javier Rodríguez Soler. "In the case of the real estate sector in Spain, it will be essential to advance and effectively implement adequate incentives to support both businesses and individuals in the process of decarbonizing the sectors."

Real Estate: A Big Sector, A Big Challenge

Buildings account for a whopping 37% of global CO2 emissions. Decarbonising this sector is vital to meet Paris Agreement goals. However, it is a complex task because emission reduction depends on multiple factors. These include improving energy efficiency, switching to electric power, and boosting renewable energy use.

Reaching these goals requires teamwork from various players. Government climate policies and incentives are particularly important for decarbonising homes. Spain's National Energy and Climate Plan (PNIEC) outlines a roadmap for emission reduction, renewable energy growth, and energy efficiency. BBVA's strategy hinges on this plan's success.

For both residential and commercial real estate, BBVA supports clients with advice and solutions that enhance energy efficiency and maximise savings.

Aluminium: A Key Metal with a Carbon Footprint

Aluminum is a vital industrial metal with demand expected to surge 40% by 2030 due to factors like electric vehicles and construction. Transitioning this sector to net-zero emissions is crucial for climate goals.

Aluminium production creates about 2% of global greenhouse gas emissions. This is because making aluminium requires a lot of energy. While some aluminium producers are self-generating power, a significant portion of emissions come from the industry itself.

To measure progress, BBVA uses the Sustainable Aluminum Finance Framework developed by the Rocky Mountain Institute (RMI). This framework helps banks assess and disclose how aligned their aluminium loans are with a 1.5°C climate scenario. Leaders in the aluminium industry are developing ambitious plans, many focused on new clean technologies to achieve zero-emission aluminium production by 2050.

BBVA's Decarbonisation Progress

As part of the Net-Zero Banking Alliance (NZBA), BBVA is committed to setting 2030 emission reduction targets for key sectors. In March, BBVA reported substantial progress in decarbonising its financing portfolio, particularly in power generation and oil & gas (with a 24% reduction).

BBVA also has sector-specific plans to guide portfolio alignment. These plans consider risk, assess client transition plans, and identify business opportunities to achieve goals. Beyond financing, BBVA supports the development of clean technologies through investments in climate funds like Fifth Wall, which focuses on reducing emissions in construction and real estate.

By expanding its decarbonisation targets and actively supporting its clients, BBVA is demonstrating its commitment to a more sustainable future.

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Source: BBVA