now loading...
Wealth Asia Connect Middle East Treasury & Capital Markets Europe ESG Forum TechTalk

Green Finance
CIF backs Philippine energy transition plan
Multilateral invests US$500 million to help coal-dependent nation move to renewables
Tom King 5 Jun 2024

The multilateral Climate Investment Funds (CIF) has endorsed an investment plan proposed by the Philippines government and allocated US$500 million to help the Southeast Asian nation in its renewable energy push and move away from its dependency on coal.

The CIF will provide US$475 million in loans and US$25 million in grants to support the country’s coal transition. The total co-financing is expected to exceed US$2.3 billion, with investments from the Asian Development Bank (ADB), the World Bank Group and the public and private sector.

In 2022, coal accounted for 44% of total installed capacity and 60% of total power generation in the Philippines. The import-reliant energy source emits over 55% of the country’s greenhouse gas (GHG) emissions, generates air pollution and is costly.  

As a first step, the Philippines’ Accelerating Coal Transition (ACT) investment plan will use the CIF’s capital to facilitate the early retirement or repurposing of the Mindanao coal-fired power plant and others that are privately owned.

In total, under its ACT plan, the Philippines plans to accelerate the retirement of up to 900 megawatts (MW) of existing coal generation capacity by 2027. To ensure a just transition of affected employees, 80% are projected to gain access to sustainable income.  

The CIF capital will also support efforts to add 1500 megawatts (MW) of renewable energy capacity by 2030, which could include battery systems, offshore wind, floating solar and pumped hydro projects.

Overall, the ACT investment plan is expected to deliver 33 million tonnes of CO2 in GHG emissions reduction by 2030 and improve the health and livelihoods of affected communities.

In the Philippines, 90% of national energy capacity is produced by the private sector. The ACT investment plan will facilitate the implementation of a private sector decarbonization and repowering programme designed to incentivize the transition away from coal and expedite the creation of the country’s renewable energy capacity.

“The Philippines government’s commitment to energy transition through the CIF ACT Investment plan is commendable,” says Ndiame Diop, the World Bank’s country director for Brunei, Malaysia, Philippines and Thailand. “The bank looks forward to supporting the government’s efforts to establish the enabling policy and regulatory environment and scale up investments for a just, sustainable energy transition.”

 

Conversation
Markus Thielen
Markus Thielen
head of research & strategy
Matrixport
- JOINED THE EVENT -
In-person roundtable
What next for digital assets
View Highlights
Conversation
Cora G. Dizon
Cora G. Dizon
CFO and treasurer compliance officer
AC Energy
- JOINED THE EVENT -
4th ESG Summit - Webinar series
Rising Expectations
Part 2 - Towards a green recovery
View Highlights