The Department of Finance (DOF) said it will seek funding sources and come up with programs aimed at attracting investments, as the country seeks to shift away from carbon-based power generation.
Based on a BusinessWorld report, Finance Asec. Paola Alvarez noted that her department is establishing a sustainable financing ecosystem to integrate public and private sector investments. She added that the DOF looks forward to help build environment-friendly energy projects very soon.
While she recognized the importance of the Department of Energy’s moratorium on the building of new coal power plants, Alvarez stressed the need to provide foundational policies to help the environment be more conducive to investment.
Alvarez said that the government is working with the Asian Development Bank (ADB) on a Coal Replacement Fund that will support the acquisition of coal-fired power plants in Mindanao and eventually elsewhere in the country to provide momentum to the shift to renewable energy (RE).
The initial goal is to set up a fund to buy all plants in Mindanao specifically and eventually close them while raising the Agus-Pulangi Hydropower Complex’s generation capacity.
Aside from financing, Alvarez said the government will also collaborate more with foreign partners and the private sector to reach the country’s climate change mitigation goals.
She said around $121 billion in total investments would be needed between 2020 and 2040.
In a related development, the Center for Energy, Ecology, and Development (CEED) expressed support for the ADB’s exploration of ways to encourage early retirement of the country’s coal facilities. However, it questioned the plan to purchase the coal plants, under which the facilities would wind down their operations within 15 years while the country shifts to RE.
“We hope to understand why [ADB] intends to [do a] buy-out scheme which, on first impression, is incompatible with its no-coal policy. With it, ADB is effectively going to finance and even take part in the operations and share in the profits of these projects for another 15 years,” CEED Executive Director Gerry Arances said in a statement.
The Philippines aims to reduce greenhouse gas emissions by 75% come 2030 based on its Nationally Determined Contribution under the Paris Agreement on Climate Change.