banks in the Philippines

RCBC’s Acevedo: No more funding for dirty coal

Ralf Rivas

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RCBC’s Acevedo: No more funding for dirty coal
The Yuchengco Group takes a hard stance against coal power plants, but notes that the shift toward renewable energy will be very challenging

“No more coal, no more coal. I’ll say that slowly: no more coal!”

Rizal Commercial Banking Corporation (RCBC) president and chief executive officer Eugene Acevedo made it clear that the Yuchengco-led bank will no longer fund coal energy projects, as the Philippines moves to cleaner energy sources.

Acevedo’s statement comes months after the Department of Energy announced that it will no longer accept new applications for greenfield coal power plants.

However, he noted that coal projects that were funded before will be on their balance sheets “for a while,” and admitted that it would be difficult for the country to rely entirely on renewables.

“It’s not to say that it will be all renewables, because the clouds can come, the waves can stop…to create a robust energy grid, there has to be a combination of renewables plus a few power plants that are rapidly ratcheted up…and those plants are usually gas-fired,” Acevedo said in a forum by the Yuchengco Group on Thursday, December 10.

PetroEnergy Resources president and chief executive officer Milagros Reyes added that while the coronavirus pandemic underscored problems with fossil fuels, particularly price volatility, the shift to green energy will remain challenging.

For instance, Reyes said that while funding for coal will be taken out, it will not necessarily go to wind, solar, or geothermal energy projects.

“It’s going to be mostly natural gas, that’s ‘deplete-able.’ But it’s clean. It’s not like coal. So like what Eugene is saying, they’ll probably be funding a lot of the LNG projects,” she said.

“However, and this is a big however, we do not expect immediate change because the fossil fuel and its products still have a big demand, but the demand will eventually scale down especially here in the Philippines.”

PetroEnergy has interests in oil exploration, geothermal, wind, and solar energy.

Reyes also noted that there are various coal-fired power plants under construction now, which will be up and running by as early as 2022.

Some Philippine banks have started to move away from funding coal projects and have set milestones in sustainable finance.

In the case of RCBC, it issued its first green bonds in 2019 amounting to $290 million or around P15 billion. It also raised P8 billion from its first peso-denominated sustainability bonds, and another $300 million in September 2019.

These bond issuances have funded a total of 9,797 green and social projects amounting to more than P56 billion.

RCBC’s sustainable lending portfolio comprised 10% of total loans as of end-September 2020. –

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Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.