Energy Secretary Raphael P.M. Lotilla has praised the recent initiatives undertaken by the Bangko Sentral ng Pilipinas (BSP) to encourage increased financing for sustainable energy projects, including support for decarbonization transition efforts.
The BSP’s move involves expanding the Single Borrower’s Limit (SBL) for green loans by 15 percent and gradually reducing the applicable reserve requirement for green bonds from 3 percent to 0 percent within two years.
These measures align with the Department of Energy’s (DOE) strategies to accelerate the Philippine Energy Transition Program, following the directives of President Ferdinand R. Marcos Jr.
Among these strategies is the deployment of renewable energy (RE) projects to reach targets of 35 percent RE share in electricity generation by 2030 and 50 percent by 2040. Additionally, there is the development of a green and smart grid, expansion of port infrastructure to support offshore wind and marine-based energy projects, and facilitating voluntary early decommissioning or repurposing of existing coal-fired power plants.
Secretary Lotilla highlighted the need for substantial private sector investments, such as equity investments, green bonds, or loans to achieve these objectives. He expressed delight, citing that energy investments in the coming decade will be spearheaded by private developers.
The BSP’s actions are part of its 11-point Sustainable Central Banking Strategy, aimed at merging sustainable finance into mainstream banking practices and aiding the country in meeting its climate commitments and sustainable development goals.
