Philippine Banks Move Away from Financing Coal Power Plants

Leading Philippine banks, like BDO and BPI, are moving away from coal financing, aligning with the push for renewable energy and a greener future. Image Credit : Steve Buissinne via Pixabay

At least four major domestic banks in the Philippines have reaffirmed their commitment to not supporting the construction of new coal plants, according to Philippine Star News. This aligns with the policies of the Withdraw from Coal: End Fossil Fuels (WFC:EFF) coalition, a group of environmentalists, faith leaders, and other sectoral organizations advocating for the reduction of fossil fuel dependence.

BDO, BPI, Security Bank, and DBP Stand Firm

BDO Unibank, the Bank of the Philippine Islands (BPI), the Security Bank, and the Development Bank of the Philippines (DBP) all support limiting coal financing.

Marla Alvarez, BDO Unibank’s Vice President and Chief Sustainability Officer, shared that the bank stopped lending for new coal capacity in 2022. She added that BDO aims to keep its coal exposure below 2% by 2033.

MGen Plans to Convert Stranded Coal Plants to Gas-Fired Facilities

BPI, the first domestic private bank to announce a commitment to halt new greenfield coal projects, reiterated its stance. BPI’s Chief Financial Officer and Chief Sustainability Officer, Eric Luchangco, said the bank’s policy includes not only new coal plants but also expansions at existing plants. BPI is committed to reducing its coal exposure to zero by 2032.

Security Bank restated its 2022 policy, confirming it will no longer finance new coal generation projects. It also plans to wind down existing coal investments by 2033.

Energy Giant Ørsted Shuts Down Its Last Coal-Fired Power Plant

DBP, a state-owned institution, reaffirmed its 2017 policy of placing coal power projects on its "negative list." This means DBP will not finance coal facilities.

Land Bank and Other Financial Institutions Following Suit

In 2023, Land Bank of the Philippines also placed new greenfield coal plants on its exclusion list. However, the bank clarified that its coal financing policy would follow the Department of Energy’s coal moratorium.

These moves by top banks signal a broader trend within the financial community, where institutions are stepping back from supporting the expansion of coal power generation.

The Need for a Shift Toward Renewable Energy

Bishop Gerardo Alminaza, the lead convenor of EcoConvergence National Hub, stressed that the disappointing outcome of COP29 underscores the urgency for the financial sector to pivot away from coal and gas. He highlighted the need for financial institutions to redirect resources into renewable energy (RE) projects, particularly in climate-vulnerable nations like the Philippines.

The Philippines, already facing frequent climate-related disasters, is in critical need of a transition to renewable energy sources. Financial institutions backing away from coal are sending a clear message to the industry: it’s time to invest in a cleaner, more sustainable future.