International International Finance Corp., the private sector lending arm of the World Bank group, on Monday signed a P3.5-billion risk-sharing facility with the Bank of the Philippine Islands to expand the sustainable energy finance program.
Under the agreement, IFC and BPI will share the risk for up to P3.5 billion of the bank’s portfolio in distributed energy projects, service companies projects and green building construction.
“BPI has always been at the forefront of sustainable energy finance in the country,” said BPI president and chief executive Cezar Consing.
“We prioritize creating sustainable shared value in our business, and our partnership with IFC will enable us to carry on this commitment for the environment, our clients, and stakeholders,” he said.
The program will provide loans and technical advice to clients investing in energy projects to reduce energy costs and cut greenhouse gas emissions.
Greenhouse gas emissions are the main contributors to climate change, which has been blamed for severe weather events that cause massive loss of human lives and damage to property and livelihoods.
IFC will provide risk sharing facilities and technical advice to partner banks who wish to lend to sustainable energy projects.
BPI released P35.3 billion worth of loans with P24.7 billion for energy efficiency, renewable energy and climate resilience projects from 2009 to October 2015.
IFC said these projects helped reduce greenhouse gas emissions by up to 1.9 million tons a year, or equivalent to taking 362,000 cars off the road.
“BPI’s SEF program has enabled companies to invest in new technologies aimed at improving the efficiency of energy generation, distribution and use, thereby cutting costs,” IFC said.
Among the renewable energy projects supported by BPI are two wind power projects with 51-megawatt combined capacity, six mini-hydropower plants with 31.59 MW and 13 biomass projects.
BPI-supported energy efficiency projects include the construction of 55 energy-efficient buildings, such as hotels, hospitals and shopping malls. Climate resilience projects financed include 11 projects related to food security and a bulk water supply project.
“IFC is pleased to continue to work with BPI in the area of climate finance. We look forward to supporting the emerging sectors in the sustainable energy market under this expanded facility,” said Marcos Brujis, IFC financial institutions group global director.