Report: US$800 Billion in Mining Finance Could Derail Clean Energy Transition

Concentrated financial power

The research shows a highly concentrated sector, with just 10 mining companies receiving 53 percent of all bank credit and 10 investors holding 82 percent of all equity and debt in transition minerals producers.

Glencore (LSE:GLEN,OTC Pink:GLCNF) tops the list, securing US$64 billion in financing from 2016 to 2024; that's double the amount received by Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO), the second largest recipient.

Aluminum Corporation of China (HKEX:2600,SHA:601600), US-based Freeport-McMoRan (NYSE:FCX) and Brazil’s Vale (NYSE:VALE) round out the top five for the period.

On the investment side, US funds dominate. As of June of this year, BlackRock held US$29 billion worth of mining securities, followed by Vanguard (US$27 billion) and Capital Group (US$21 billion).

Together, the top 10 investors controlled US$118 billion.

Banks in just five countries — China, the US, France, Canada and Japan — accounted for 63 percent of all lending.

“This geographic concentration reinforces existing imbalances in who controls and profits from the energy transition,” the report explains.

Weak safeguards and mounting risks

Despite their central role in mining, the report says most financial institutions have inadequate or vague policies.

In an assessment of 30 banks and investors, the average score was just 22 percent against international benchmarks for environmental, social and governance (ESG) standards.

For instance, the Norwegian Government Pension Fund, often cited as a global leader in sustainability, scored highest at 48 percent, but still lacks policies on mine reclamation, tailings waste and Indigenous land rights.

At the bottom were Vanguard and China’s CITIC, each scoring just 3 percent.

Eighty percent of institutions have no safeguards for human rights defenders, despite documented violence against activists opposing mining projects. No institution have protections for Indigenous peoples living in voluntary isolation.

Since 2010, researchers have logged 835 allegations of abuse tied to transition mineral mining, from pollution to attacks on environmental defenders.

Case studies: Indonesia, Brazil and the DRC

The report from the Forests & Finance Coalition connects these financial flows to real-world harms by highlighting regions where investments are driving severe consequences.

For example, in Indonesia, a surge of nickel projects financed largely by Chinese capital has transformed regions such as Obi Island and Sulawesi. These operations have cleared forests, polluted rivers and entrenched dependence on coal-powered smelters, undermining the promise of a “green” supply chain.

Harita Group, cited in the report as receiving US$5.1 billion in bank credit, has faced allegations of attempting to conceal water contamination containing carcinogenic chromium.

In Brazil, mining giant Vale was at the center of two of the country’s worst industrial disasters.

The 2015 Samarco dam failure and the 2019 Brumadinho collapse together claimed nearly 300 lives and caused devastation across surrounding communities. In Pará state, home to the world’s largest open-pit iron mine, local residents continue to grapple with pollution and social conflict.

The Democratic Republic of Congo (DRC), which supplies roughly 70 percent of the world’s cobalt, is another region that illustrates the problem. Communities living near major mining operations report polluted waterways, declining fish stocks and widespread health problems tied to industrial activity.

Investment without accountability

The International Energy Agency estimates that meeting projected mineral demand could require US$800 billion in new mining investment by 2030. Forests & Finance Coalition warns that without stronger regulation, this capital will fuel more “high-risk, environmentally destructive and socially harmful practices.”

South America has already emerged as the top destination for mineral finance, attracting 30 percent of all credit (US$151 billion) and 36 percent of investment (US$105 billion), largely for copper and lithium projects.

Oceania ranks second, driven by Australia’s role in supplying iron, copper, and lithium.

The findings echo concerns raised last month by the Fraser Institute, whose 2024 survey of mining executives cites policy instability, regulatory burdens and social conflict as growing deterrents to investment.

Civil society groups argue that reforming mining finance is as critical as reforming mining itself.

They call for binding safeguards on deforestation, tailings, Indigenous rights and human rights defenders, alongside greater transparency in how banks and investors allocate capital.

The United Nations (UN) has also weighed in. In 2024, the UN secretary-general convened a high-level panel on critical energy transition minerals, urging states and companies to align mineral supply chains with human rights and sustainability standards. However, the Forests & Finance Coalition argues the bar must be raised further.

"A truly just energy transition depends on just finance that reduces harm, upholds rights, protects nature and supports equitable clean energy access,” the report concludes.