Security Bank announced that it would no longer provide financing to coal-fired power plants in its attempt to align its project financing strategy with the objectives of the Paris Agreement and climate change diplomacy based on the 26th Conference of Parties (COP26) on reducing the risks associated with climate change.

In a statement to the media, Security Bank said it will stop financing coal projects by 2033 – about a decade from now, so it can contribute to the global goal “to reduce greenhouse gas emissions”. greenhouse and limit global warming for a more sustainable future”. .”

Security Bank clarified that in moving away from coal-fired power generation projects, “it will work with its customers in the energy sector who are committed to sustainable development by supporting the use of energy sources low-carbon economy and funding new technologies to help transition to a low-carbon economy.

He stressed that “the bank will provide these customers with support, both from a lending and capital market perspective.”

According to Eduardo Olbes, Chief Financial Officer and Chairman of the Security Bank’s Sustainability Committee, the plan to cease financing coal projects had been anchored on its Environmental and Social Risk Management System (ESRMS) which was approved by the board. of directors of the bank last year.

“A key aspect of the ESRMS is our coal policy, which outlines our commitment to stop funding the construction of new coal-fired power plants, with a view to no longer funding coal generation by 2033,” he said. -He underlines.

The bank’s self-designed ESRMS sets out “the policies and enhanced due diligence necessary to identify, address and mitigate environmental and social risks in (its) operations, lending and investment practices and supply chain “.

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

Although the updated Philippine Energy Plan (PEP) 2020-2040 already targets shifting investment towards renewable energy (RE), the realistic situation for the country is that it may still need to rely on power plants to coal in the short and medium term due to recurring problems. electricity shortage problems.

The Security Bank also cited market research conducted by Statista that “the Philippines still relies heavily on coal as its main source of energy, with 57% of the country’s energy needs coming from it”, while 21% of energy resources are supplied by renewable energy technologies. which include hydro, wind, solar and geothermal.

In addition to removing coal financing from its loan portfolio, the Security Bank has indicated that it will also pursue other initiatives rooted in the United Nations Sustainable Development Goals.

These will include the promotion of “decent work and economic growth”, as well as the development of industry, innovation and infrastructure – which will be integrated into its mission “to enrich lives, empower businesses and build communities in a sustainable way”.