Ayala-led Bank of the Philippine Islands (BPI) aims to stop by 2033 all lending to coal-fired power projects—which form 45 percent of its current power generation portfolio—and channel more funds to renewable energy projects moving forward.
BPI, which is celebrating its 170th anniversary this year, has identified sustainability among its four key priorities under its new president, Teodoro Limcaoco, along with digitalization, customer services and consumer banking.
In a press briefing on Monday, Limcaoco said while BPI’s original commitment was to halve coal financing by 2026 and go down to zero by 2037, in line with the Paris accord to decarbonize, it was possible to totally phase out all remaining coal lending by 2033.
“We believe energy is still an important component, a big need of this country. My belief is renewable power is getting cheaper and cheaper to produce, is getting more economically feasible and I think storage technology will improve very rapidly,” he said.
In a couple of years, Limcaoco said wind and solar could become baseload power sources, or the plants that could generate a minimum amount of electric power needed by the grid at any given time.
“We are looking to finance renewable power moving forward because that’s what the country needs,” Limcaoco said.
To date, renewables account for 45 percent of BPI’s power generation loan portfolio, same as the proportion devoted to coal. The remaining 10 percent is devoted to gas-fired projects.
The country still relies on coal for 58 percent of its energy needs, while renewables account for 21 percent, same as the ratio for gas, which is still seen necessary during the world’s transition to a “net zero” carbon future.