Mining industry suppliers and mining, engineering and technology services businesses also told the inquiry - which is being chaired by Dawson MP George Christensen - they were unfairly targeted by changes to insurance premiums.
Resource Industry Network general manager Dean Kirkwood said to deny METS businesses access to insurance and lending based on their supply connections to coal did nothing to mitigate climate change.
"METS businesses work across a diverse range of sectors including renewables," he said.
"They are the key to the development of technology critical in reducing emissions.
"They also are actively pursuing, creating and deploying solutions across the entire resources value chain to provide the building blocks of low-emission technologies and are well entrenched in the decarbonising journey."
RIN chairman David Hartigan added to the hearing by offering his business' experience on the issue.
He said Field Engineers Professional Indemnity insurance had changed dramatically in the past six years.
"The annual increase compounding every year has been 61%," Hartigan said.
"If you contrast this to the CPI, it's 1.5% for the rest of the economy.
"It's 18 times higher now than it was six years ago, and we now spend more on this intangible risk management tool than we do on IT or diesel for our fleet of vehicles. Our insurance is now our biggest single cost other than wages.
"What's troubling us even more is the fact that an arbitrary cap has been placed on a proportion of the business' income that can be derived from working with thermal coal companies.
"A cap like this hits small regional businesses because their book is more likely to be comprised largely of mining operations in which they are located in close proximity. It does not affect big businesses, transnational, or multinationals because their order book is much bigger, and they have more options when it comes to accessing international finance."
Queensland Resources Council CEO Ian Macfarlane echoed RIN's concerns on the effect the actions of the banks and insurance companies will have on METS and regional businesses that supply the coal mining industry.
He said Queensland businesses that supported the state's $82.6 billion resources sector, particularly the all-important METS sector, were being disadvantaged.
"Insurers and banks are increasingly trying to appease activist shareholders by reducing or cutting ties with operators connected to resources," he said.
"In some cases, insurance premiums are tripling, and the cost of credit is skyrocketing simply because a business is supplying goods or services to the resources sector.
"The irony is that by restricting the ability of METS businesses to renew their insurance policies and access finance, these lenders and insurers are threatening the viability on the very sector that will play a leading role in Queensland's transition to a low-emissions future."
Macfarlane told the committee jobs would be lost if resources-related businesses could not get finance or insurance at reasonable rates.
"Through our submission, the QRC is giving a voice to service companies, many of which are based in regional areas, to send a message that jobs will be lost because of increasingly unfair banking and insurance practices," he said.
Macfarlane said the QRC supported the Paris Agreement and emissions' reductions targets, and that Australia's well-regulated and environmentally sustainable resources sector could continue to thrive while meeting these targets.
"Queensland is abundant in resources and has the potential to become a global renewable and low-emissions' energy superpower, but resources companies need a viable METS sector to provide technical expertise and innovation to support our operations," he said.
"The QRC hopes this inquiry will encourage the banking and insurance sectors to work with their regional clients to implement practical reforms that will lower emissions and help keep exports rolling."
In its submission to the inquiry Whitehaven Coal said allowing this targeting of businesses based on their exposure to coal to continue unchecked had the potential to inflict significant damage on Australia's valuable export industries and the economy more broadly, particularly in regional areas.
"It would represent an especially savage blow to regional Australia, where many of our resources and export industries are based, not only shutting down direct investment and jobs but causing multiplier effects across suppliers and other businesses dependent on Australia's large export industries," it said.
"In effect, restrictive lending policies would act as a deterrent to investment in regional Australia, without consideration for alternative jobs or economic prospects in regional towns.
"While to date the coal mining sector has been the target of the banks' restrictive policies, it is likely every extractive industry in the resources sector will be subject to similar pressures, as well as beef, lamb and other agriculture exports that generate methane emissions."
Whitehaven said the climate-related policies of Australia's "Big Four" banks in particular were at odds with the energy transition framework favoured by the Australian government.
"The funding restrictions being imposed are having the effect of putting the banks ahead of government and industry on policy timeframes, which has the potential to cause further uncertainty for industry and put Australian jobs at risk - particularly in regional areas," the miner said.
"The banks have been the subject of considerable pressure exerted by a small but vocal and active constituency, which is leading to a disproportionate response untethered from considerations around our national economic interest or even whether such actions have meaningful benefits for global CO2 reduction.
"While the banks have so far been the most responsive to this pressure, and their actions are having the biggest impact on the export industry, there is no doubt the superannuation and insurance industries are also facing increasing pressure from activist campaigns."
Bravus Mining and Resources told the inquiry that at a time when Australia's major political parties had acknowledged the critical contribution the thermal coal industry would play in the national recovery post the COVID 19 pandemic, there was a substantial misalignment between this recognition at a political and governmental level and the conduct of Australia's major banks and insurance companies which were actively pursuing a divestment agenda that would lead to a complete withdrawal of banking relationships and insurance coverage with the sector from 2030.
"It is our submission that these decisions by the banks and insurance companies, when aggregated, will create a dramatic and adverse impact on one of the nation's significant export industries, will erode the industry's competitive position, curtail investment, and limit the industry's ability to capitalise on the market gains and efficiencies that has been achieved over past decades," Bravus stated.
"In short - by withdrawing services form the Australian thermal coal sector the finance and insurance sectors are exporting Australian livelihoods offshore.
"Removing Australian coal from the global seaborne market will only see other jurisdictions with poorer quality coals and less stringent environmental regulations fill the gap. The end result being that Australians are disadvantaged and the world sees increased emissions on the back of poorer quality coals replacing Australian high-quality coals."
Bravus said the major banks' climate statements started with a reference to climate objectives of the Paris Climate Agreement, which came into force in 2016.
It said the respective statements then outlined their support for a transition to net zero emissions by 2050, followed by actions that would be pursued by each bank, under headings such as "engaging constructively and transparently with stakeholders", "the need for an orderly and just transition", "continuing to support existing customers across the mining and energy sectors to facilitate an orderly transition to a low carbon economy", "engage responsibly on climate policy" and "help customers and communities respond to climate change continue to support our existing thermal coal mining customers".
"While the senior executives of the major banks may talk about transitioning the thermal coal industry, it is our observation there is little evidence of transitioning occurring, if anything, bank officials are displaying a zealot like enthusiasm to withdraw from the industry," Bravus said.
"We submit to the committee that our industry is confronting an acceleration of the withdrawal from the coal industry - a withdrawal that only seeks to punish hardworking Australian miners.
"Australian banks are not only abandoning a key industry sector, they stand to also abandon the principles of prudent risk management where banking risks are managed objectively and quantitatively directly with the individual customer, not through ‘group think', supposition, pressure from anti-fossil fuel activist groups or some other qualitative evaluation."
Bravus said that similar to the banks, Australia's major general insurance companies, which dominated the insurance market, had, through their respective climate policies, announced a withdrawal from underwriting the thermal coal industry.
"The companies representing much of the Australian market, Insurance Australia Group, Suncorp Group, and QBE, have announced the phasing out of coverage by 2023 and 2030," it said.
"These Australian insurance companies appear to have followed a global divestment push led by European insurance companies with little to no regard to their national responsibilities to the workers and companies of Australia.
"The consequence of the banking and insurance sectors removing support for the thermal coal sector has the immediate impact of increasing financing costs associated with developing new projects or maintaining existing operations.
"Ultimately this results in increased costs of development or operations, meaning that Australian thermal coal producers become less competitive in what is a globally competitive market."
Bravus said making the Australian thermal coal sector less commercially competitive in a global market would only result in poorer quality coal being exported from other international jurisdictions such as Indonesia, meaning Australia suffered.
In its submission the New Hope Group said a number of insurance companies had become reluctant to insure businesses in the coal industry due to concerted campaigns by activist groups.
"The current stance of these insurance companies is particularly evident for Liability and Property [also known as Industrial Special Risks insurance]," it said.
"Some limited appetite remains for mobile plant and equipment insurance.
"Over the past four years New Hope's insurance has more than doubled and it is becoming increasingly difficult to secure directors' insurance.
"It has been widely reported that the following insurers have withdrawn from insuring coal mines in the past three years: Allianz, Chubb, Liberty, QBE, CGU, Vero, Zurich, certain Lloyds syndicates, Swiss Re, Munich Re. Sterling, FM Global, Axis and AXA."
New Hope said financial institutions were also withdrawing support to businesses associated with the coal industry, again making it difficult to secure finance for capital expenditure.
"One recent example is the February 2021 decision by ANZ to withdraw from the financing syndicate for the Port of Newcastle, Australia's largest coal port," New Hope said.
"This was reported to be a consequence of ANZ having adopted policies in 2020 that prohibit it from entering new finance deals for customers with significant exposure to fossil fuel.
"Superannuation funds have also made a big deal out of divesting their shares in coal companies, largely to pacify the vocal minority of activists."
In New Hope's case, superannuation funds and major investment firms have taken a small position in the company only to sell the shares in a very public announcement to create the perception of being a responsible investor.
"If the financial institutions continue on their current course of rejecting the business of coal companies, the consequences will be dire," it said.
"Costs of doing business in Australia is already becoming prohibitive and, for the resources sector, increased government regulation is making it increasingly difficult to keep projects viable.
"The actions of these financial institutions have already significantly added to the cost of doing business, elevated business risk and stifled capital investment, as prudence dictates that vastly increased cash must be retained within the business to cover uninsurable property risks.
"The flow on effects of this on the communities in which we operate is equally significant. Reduced profits will lead to less cash circulating in local communities, impacts on wage increases and a lower probability of mine expansions or new mine developments."
New Hope said this ultimately resulted in a reduction in regional employment opportunities and opportunities for skills development.
"Local contractors, who make up a huge part of our business, will lose work as projects are slowed or put on hold and support for local community organisations and sporting groups will reduce," it said.
"The resources sector has been, and will continue to be, a major contributor to the economic recovery post COVID-19. Despite the reduced dependence of coal as a power source in Australia, thermal coal will continue to be in demand across South East Asia.
"The value of our coal exports to the Australian economy cannot be underestimated and should not be put at risk through the anticompetitive actions of our financial institutions and the misguided objections of a vocal minority."
