Yuchengco-led Rizal Commercial Banking Corporation (RCBC) said it will zero out its exposure to coal-fired power plant projects by 2031 and instead, focus its lending services on renewable energy projects.
RCBC President and CEO Eugene Acevedo said the move is part of the bank’s “net zero revolution,” adding that businesses need to double their efforts to achieve it.
The bank had announced in December 2020 that it will stop funding new coal plants in the country, though no date was mentioned back then. RCBC’s pronouncement followed the Department of Energy’s moratorium on the construction of new coal plants, which it imposed in October that year.
RCBC Corporate Banking Group head Elizabeth Coronel said that the bank is in the process of closing funding deals for solar, hydro, and geothermal projects with a combined capacity of 1.6 gigawatts (GW). These are expected to be completed in the next two years. The bank has funded a total of 3.06GW of RE projects since 2012.
In February, the bank raised Php14.8 billion by offering sustainability bonds. Proceeds will be used for purposes connected with RCBC’s sustainable finance framework. In the same month, it launched green time deposits, which have a minimum investment of Php5,000.
The funds raised will finance sustainability projects related to RE, energy efficiency, and pollution prevention and control, among others.
RCBC also said that it will be funding at least 1,600 megawatts (MW) of RE projects over the next two years. 70% of the bank’s loan projects will be allotted to solar farms, while the balance will be for wind, geothermal, and hydropower projects.
The Asian Development Bank in May last year said it would stop funding coal plants. Come November, it partnered with the Philippines and Indonesia to back the energy transition mechanism (ETM) for the two countries. Under the ETM, coal plants would be closed in favor of developing RE facilities.
