Green financing eyed for renewable energy

Cebu City  , Philippines  — Government-run Development Bank of the Philippines (DBP) still sees continued opportunity in green financing with upcoming measures to support renewable energy (RE) development, an official said.

The state-run bank is looking into opportunities to fund green energy projects with the implementation of the Renewable Portfolio Standards (RPS), DBP first vice president Paul Lazaro said in an interview with reporters during the 2nd Philippine Environment Summit here.

“We look into those developments. If there is a need that we craft certain projects to support these types of investments, we do it,” Lazaro said. “There are a lot (of applications) as far as renewable energy is concerned.”

The RPS would be a driving factor for lending to green energy projects after the feed-in tariff (FIT) installation target for solar and wind have already been taken up. Meanwhile, the Department of Energy (DOE) is only extending the FIT installation target for run-of-river hydro and biomass technologies.

 “The DOE has given an extension for run-of-river and biomass. There’s no more for solar and wind. We still have to look at the market right now if there is still appetite,” he said.

A provision of Renewable Energy (RE) Act of 2008, RPS mandates power industry players to produce and source a certain percentage of electricity from RE sources such as biomass, waste-to-energy technology, wind energy, solar energy, run-of-river hydroelectric power systems, impounding hydroelectric power systems, ocean energy, and geothermal energy.

The DOE has issued in December a circular which prescribes the rules and guidelines in the establishment of RPS for On-Grid Areas which mandates distribution utilities (DUs), retail electricity suppliers including those power generation companies serving directly-connection customers to source or produce a certain percentage of their electricity requirements from eligible RE resources.

The agency has set 2018 and 2019 as transition years for to prepare the power industry in developing their compliance plans to the minimum RPS requirements.

DBP has lending programs for green and clean projects, which is in line with the bank’s adoption of an environment policy in 1997.

“Even if you have a lot of requirement from other sectors, we take into consideration the projects we finance, and if these are green ones, we are always supportive of these,” Lazaro said.

Part of the bank’s consideration is the environmental and social aspects of the projects. “It’s not only the environmental side when we assess projects but also social aspects,” the DBP official said.

So far, DBP has disbursed P37.92 billion to 72 borrowers under its Financing Utilities for Sustainable Energy Development (FUSED).