MUFG open to financing PH nuclear projects backed by Japan

MANILA, Philippines – MUFG Bank Ltd. is open to financing nuclear energy projects in the Philippines, should the country pursue them as part of its energy diversification strategy, provided that the Japanese government and Japanese developers support them.

At a media briefing, MUFG managing director Colin Chen said the bank, Japan’s largest, would follow the Japanese government’s lead on nuclear energy even as it continues to support the Philippines’ renewable energy transition.

READ: PH is ready for responsible nuclear energy use – Dy

“The answer is yes, we are, but under certain circumstances,” Chen said when asked whether MUFG would finance nuclear power projects in the Philippines.

“As a bank, we will support the Japanese government’s initiative to do nuclear plants,” he added. “So as long as the Japanese government is pushing that initiative … we will do it.”

Chen, who leads MUFG’s sustainable finance department for Asia-Pacific, said the bank would consider financing projects supported by the Japan International Cooperation Agency, the Japan Bank for International Cooperation, or Japanese contractors involved in nuclear development.

While interest remains in large-scale nuclear facilities, Chen noted that growing interest in small modular reactors is seen as safer and more flexible than conventional nuclear plants.

“Those will be a lot more attractive, and presumably safer to put into place,” he said.

Under the Philippine Energy Plan 2023-2050, the government targets at least 1,200 megawatts of nuclear capacity by 2032. This is expected to rise to 2,400 MW by 2035 and 4,800 MW by 2050.

Last week, the Department of Energy said it was studying potential nuclear power plant sites in the country, including the possibility of reviving the mothballed Bataan Nuclear Power Plant (BNPP).

Beyond nuclear power, MUFG said it continues to see strong opportunities in Philippine sustainable infrastructure and energy projects.

Global finance target

The bank aims to provide 100 trillion yen ($680 billion) in sustainable finance by 2030, with about half allocated to green projects.

As of last year, 43.6 percent of that target had already been achieved, according to Jonathan Win, vice president for the sustainable finance department APAC.

Chen said the Philippines ranks relatively high within MUFG’s sustainability financing pipeline due to strong demand from large corporations pursuing environmental and decarbonization goals.

“It’s safe to say that the Philippines figures pretty high in our sort of list of groups because there is a good corporate market for sustainable deals,” he said.

Across Asia, India, Indonesia and Hong Kong currently account for some of MUFG’s largest sustainable finance markets, driven by renewable energy, project finance and corporate sustainability transactions.

In the Philippines, MUFG has financed several renewable energy and sustainability-linked projects, including ventures by Prime Infra, San Miguel Global Power, SN Aboitiz Power, Ayala Corp., and ACEN. /pai INQ