BDO Unibank Inc. has pledged to cut its coal exposure by as much as 50% in the next decade as it shifts to funding renewable energy projects.
BDO senior vice president and head of compliance group Federico Tancongco said that the company is set to continue its current practice of not funding new coal-fired power plant projects.
Furthermore, Tancongco said that BDO has also committed that its coal exposure will not exceed two percent of the bank’s total loan portfolio by 2033. However, BDO is considering extending capital to coal projects as the national government implements provisional emergency measures to address the energy crisis.
Tancongco added that they acknowledge what the country’s energy experts and economists “have been sharing for the past two years on energy security and how it may impact the economy and our people.”
BDO said that it has been actively funding renewable energy projects like solar, geothermal, wind, hydropower, and biomass, as well as green buildings. Tancongo said that this is BDO’s way of supporting the country’s “ambitious goal for 75% coal reduction and avoidance of greenhouse emissions by 2030.”
Earlier, BDO expressed its openness to funding RE projects in the country, as well as nuclear power projects.
Apart from BDO, the Yuchengco-led Rizal Commercial Banking Corporation (RCBC) will also stop funding coal-fired power plants by 2031. Security Bank will also cease funding coal projects by 2023.
Under the Philippine Energy Plan 2020-2040, the country aims to have a 35% share of renewable energy in the power generation mix by 2030 and 50% by 2040.
In 2021, the Bangko Sentral ng Pilipinas called on banks to support the country’s energy transition following Asian Development Bank and the Philippine government’s partnership for the energy transition mechanism launched during the United Nations Climate Change Conference (COP26).