The Center for Energy, Ecology, and Development (CEED) has called on BDO Unibank, Inc. to abandon its financing of fossil fuels and commit fully to renewable energy (RE) projects during BDO’s annual shareholders’ meeting last week.
BDO, the largest bank in the Philippines, has been identified by CEED’s recent report as the top financier of fossil gas expansion in the nation, directing USD 356.18 million into the industry since 2021. The bank has also invested a substantial USD 3 billion in coal since 2009. This extensive financing of fossil fuels placed BDO second on this year’s Fossil Fuel Divestment Scorecard.
San Carlos Diocese Bishop Gerardo Alminaza, part of the Withdraw From Coal: End Fossil Fuels coalition, addressed BDO’s moral duty to Filipinos in a letter, urging the bank to leverage its significant influence for the country’s renewable energy transition, in light of the climate emergency.
Bishop Alminaza also expressed his disappointment with BDO’s Annual Stakeholders’ Meeting for not addressing his concerns about the bank’s timeline to include fossil gas in its Energy Transition Finance statement.
BDO’s financing of RE totals USD 1.7 billion from 2009 to 2023, yet the bank has allocated double that amount to non-renewable sources, highlighting a funding paradox within domestic banks.
Avril de Torres, deputy executive director of CEED, criticized the practice, stating that while banks are investing in RE, their significant contributions to fossil fuel projects are aggravating climate change and rising electricity prices. She emphasized the need for banks to abandon fossil fuel financing in favor of RE to aid the country’s energy transition.
BDO has declared in its 2023 Sustainability Report its intention to reduce coal exposure to below 2% by 2033. However, CEED’s research indicates that the bank’s measures only align with natural maturities rather than proactive efforts to curtail coal financing.
Data from Climate Analytics suggests that to maintain alignment with the 1.5°C target, the Philippines must phase out coal between 2030 and 2035 and fossil gas between 2035 and 2040. Reinforcing this, multiple studies, including one by the International Energy Agency, assert that no new fossil fuel developments are compatible with the 1.5°C target.
Bishop Alminaza during the launch highlighted the need for banks to expedite their RE investments to surpass fossil fuel financing, thereby guiding the country towards a clean energy transition.
While acknowledging banks’ legal commitments to coal and gas companies, Alminaza underlined the moral imperative to assist clients in moving away from fossil fuels, given the current climate emergency.
