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May 27, 2024

Security Bank to stop funding coal-fired power plants by 2033

Security Bank Corp. led by bankero Sanjiv Vohra is ending the financing of coal-fired power projects in the Philippines by 2033 as it aims to shift to cleaner renewable energy projects.

Security Bank chief financial officer Eduardo Olbes said that the commitment is in line with the country’s pledge during the 2021 United Nations Climate Change Conference of the Parties (COP26) and the 2015 Paris climate agreement to cut greenhouse gas emissions and limit global warming for a more sustainable future.

Olbes, who is also chairs the bank’s sustainability committee, added that the listed bank approved a sustainability framework in 2020 to address environmental, social, and governance issues.

Security Bank also approved it Environmental and Social Risk Management System (ESRMS) in 2021 detailing the policies and enhanced due diligence required for identifying, addressing, and mitigating environmental and social risks in the Bank’s operations, lending and investing practices, and supply chain.

“A key aspect of the ESRMS is our coal policy, which specifies our commitment to discontinue financing the construction of new coal-fueled power generation plants, with a view to exit funding coal generation by 2033,” Olbes said.

As it starts to move away from coal-fueled energy generation projects, Security Bank aims to work with its clients in the energy sector who are committed to sustainable development by supporting the use of low carbon energy sources and financing new technologies to help in the transition to a low-carbon economy.

The listed bank will also provide affected clients with support, both from a lending and capital market perspective.

Market and consumer research company Statista said coal remains the main source of energy in the Philippines accounting for 57 percent of the country’s energy needs.

On the other hand, renewable energy sources such as hydro, wind, solar, and geothermal energy make up only 21 percent of the country’s energy resources.

“Security Bank is committed to long-term sustainability by advocating lending, investment, and procurement activities that will help the country transition to a lower carbon economy and build resilience to climate change,” Olbes said.