The International Finance Corp. (IFC) has signed a risk-sharing agreement with the Bank of the Philippine Islands (BPI) that broadens the bank’s successful Sustainable Energy Finance (SEF) program.
The program provides loans and technical advice to clients investing in energy projects to help reduce energy costs and cut greenhouse gas emissions, The World Bank Group’s private sector financing arm said in a statement Monday.
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 said it provides risk sharing facilities and technical advice to partner banks that intend to give loans to sustainable energy projects.
The new agreement allows IFC and BPI to share the risk for up to P3.5 billion of the bank’s portfolio in distributed energy projects, Energy Service Companies (ESCO) projects, and green building construction, it said.
Since 2009, BPI has released P35.3 billion worth of loans —P24.7 billion outstanding as of October 2015—for energy efficiency, renewable energy and climate resilience projects.
IFC said these projects help reduce greenhouse gas emissions by up to 1.9 million tons a year, which is roughly 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, it added.
Among the renewable energy projects supported by BPI are two wind power projects with a 51 megawatt (MW) combined capacity, six mini-hydropower plants with 31.59 MW combined capacity, and 13 biomass projects.
BPI-supported energy efficiency projects so far include the construction of 55 energy-efficient buildings, such as hotels, hospitals, and shopping malls.
Climate resilience projects include 11 projects related to food security and a bulk water supply project.
BPI President and Chief Executive Officer Cezar Consing said the bank has always been at the forefront of sustainable energy finance in the country.