Green Infrastructure
Investment Opportunities
PHILIPPINES
2020 REPORT

Philippines GIIO Report Climate Bonds Initiative

Supported by the ASEAN Catalytic Green Finance Facility, the Asian Development Bankand the Securities and Exchange Commission Philippines1This report highlights green infrastructure investment
opportunities in the Philippines
This report has been prepared to help
meet the growing demand for green
investment opportunities in the Philippines
and to support the country’s transition to a
low carbon economy.
It aims to facilitate greater engagementon this topic between project owners anddevelopers, and institutional investors.
Green infrastructure and corresponding
green finance instruments are exploredin the report, with sector-by-sector
investment options presented.
The report is intended for a wide rangeof stakeholders, including domestic
investors, offshore pension funds andasset managers, potential issuers,
infrastructure owners and developers, aswell as relevant government ministries.
In developing this report, the Climate
Bonds Initiative (CBI) consulted with key
Government bodies, industry, the financial
sector, peak bodies, NGOs and think

Green Infrastructure Investment
Opportunities (GIIO) Report Series
Green infrastructure presents a hugeinvestment opportunity globally, with anestimated USD100tn worth of climate
compatible infrastructure required from now
to 2030, in order to meet Paris Agreement
emissions reduction targets. However, there
remains a lack of identifiable, investmentready and bankable projects. There is also alack of understanding of what types of assets
and projects qualify for green financing.
In response to this challenge, CBI isdeveloping a series of reports that aim to
identify and demonstrate green infrastructure
investment opportunities around the world.
By so doing, it aims to raise awareness ofwhat is green and where to invest, as well as
to promote green bond issuance as a tool tofinance green infrastructure.
The report series commenced with the
GIIO Indonesia report, launched in May
2018, followed by five other reports –Climate Bonds Initiative
The Climate Bonds Initiative is aninternational investor-focused not-forprofit organisation working to mobilise
the USD100tn bond market for climatechange solutions.
It promotes investment in projects andassets needed for a rapid transition to a low
carbon and climate resilient economy. The

2

Table of contents

tanks – in partnership with the Securities
and Exchange Commission (SEC) of thePhilippines and the Asian Development
Bank (ADB). We would like to thank thesepartners along with the other organisations
that contributed to the report: The Philippines
Department of Finance, the Public-Private
Partnership Center of the Philippines;
National Economic and Development
Authority (NEDA), Development Bank of thePhilippines, BDO Unibank, Rizal Commercial
Banking Corporation (RCBC), Thomas Lloyd
Group, AC Energy, and BioPower Group.

3

SEC Foreword

4

ADB Foreword

5

Green infrastructure: anopportunity for growth

679• Snapshot: Macroeconomic outlook• Snapshot: Infrastructure spending• Snapshot: Climate policy

10 Green finance trends andopportunities
10 • Global demand for green is growing
11 • Green finance is growing in thePhilippines
12 • Snapshot: The Philippines Green
Bond Market
20 • Brown to green transition in thePhilippines

CBI also acknowledges the contributions madefrom members of the ADB Southeast Asia
Innovation Hub and ASEAN Catalytic Green
Finance Facility (ACGF) teams, including
Joven Balbosa, Advisor, ADB Southeast
Asia Department; Anouj Mehta, Unit Head,Green and Innovative Finance and the ACGF;
Camille Bautista-Laguda (consultant, ACGF);
Lianne De La Paz (consultant, ACGF), andMarina López Andrich (consultant ACGF).

24 Green infrastructure investment
opportunities

the latest being the GIIO Vietnam report,
launched in April 2020. Future GIIO reports
will include further exploration of opportunities
in Asia-Pacific as well as in Latin America.1

25
28
31
35
38

• Renewable energy• Low carbon transport• Sustainable water management• Sustainable waste management• Other green opportunities

39 Measures for growing green
infrastructure
40 Annexes
40 • Annex I: Green debt instruments
43 • Annex II: Green equity instruments
44 • Annex III: Credit enhancement
mechanisms
46 • Annex IV: Risk transfer
instruments
47 • Annex V: Green standards
applicable in the Philippines
49 • Annex VI: Sample Green Pipeline

Green Infrastructure
Investment Opportunities
VIETNAM
2019 REPORTSupported by European Climate Foundation

54 Endnotes
Green Infrastructure
Investment Opportunities
AUSTRALIA 2019

Green Infrastructure
Investment Opportunities
INDONESIAUPDATE REPORT

Exchange Rate September 30, 2020
1 USD = 48.48 PHP
1 PHP = 0.0206 USD
Sponsors

Supported by European Climate Foundation

mission is to help drive down the cost of capitalfor large-scale climate and infrastructure
projects and to support governments seeking
increased access to capital markets to meetclimate and greenhouse gas (GHG) emission
reduction goals.
CBI carries out market analysis, policy research,market development; advises governments
and regulators; and administers a global green

bond standard and certification scheme. CBIscreens green finance instruments against
its Climate Bonds Taxonomy to determinealignment and uses sector specific criteria
for certification.
A simplified version of the Climate Bonds
Taxonomy is on page 59. More information on
the Climate Bonds Standard and Certification
Scheme can be found on page 21.

Philippines GIIO Report Climate Bonds Initiative

SEC Foreword
As an archipelago in South East Asia situated on both the“Typhoon Belt” and “Pacific Ring of Fire,” the Philippines has long
been exposed to environmental challenges. In fact, the country is
considered among the most vulnerable to the effects of climatechange – the nation’s 100+ million people which are spread acrossmore than 7,000 islands, regularly face powerful – and increasingly
more frequent – typhoons, earthquakes and volcanic eruptions.
In more recent years, the country also had to deal with rising sea
levels, and periods of droughts and floods caused by the “El Nino”
and “La Nina” weather phenomena.
Armed with first-hand experience in dealing with the overwhelming
impact of climate change on the economy, Philippine authorities
worked toward establishing a supportive enabling environment
for the development of a sustainable financial market. Amongthe measures taken by the Philippine Securities and Exchange
Commission (SEC), in conjunction with fellow ASEAN regulators,
was the adoption of the ASEAN Green Bond Standards (GBS),ASEAN Social Bond Standards (SBS) and the ASEAN Sustainability
Bond Standards (SUS).
These ASEAN Standards were developed by the ASEAN CapitalMarkets Forum (ACMF) and were intentionally aligned with theInternational Capital Market Association’s Green, Social andSustainability Bond Principles, as well as the Climate Bond Initiative’s(CBI) criteria. The ASEAN Standards were intended to provide clear
guidance for issuers as well as a measure of assurance to investors
that bonds carrying the ASEAN Green and Sustainability labels
adhere to international best practice. Notably, the ASEAN GBS goesa step further than the ICMA Green Bond Principles by expressly
prohibiting fossil fuel power generation-related projects.
Since the adoption of the ASEAN Standards, we have seen the rapid
growth of the Philippine green bond market led mainly by the private
sector. To date, total Philippine sustainable bond issuances stands at
US$3.4 billion equivalent – both on and offshore – 90% of which havebeen issued by Philippine banks, renewable energy, infrastructure andreal estate companies. This active and primary role of private sector
green bond issuers distinguishes the Philippines from other nascentgreen markets, where sovereign borrowers have played a more
prominent first mover role. Indeed, in 2019, 10.6% of the total loan
portfolio of the Philippine banking system went to finance green andsocial projects that were in line with the Sustainable Development
Goals of the United Nations.
The currencies in which our firms raised funds have been diverse,
from Philippine Pesos, to US Dollars, and even a Swiss Francplacement – that last transaction, by one of the top three Philippine
banks, resulted in a negative yield. This diversity has been crucial
for it exposed our issuers to a wide and diverse range of investors
and their specific concerns and expectations. This diversity – raisingbonds locally, in the region and in Europe, and in multiple currencies –provides a strong foundation for additional issuance and investment.

Philippines GIIO Report Climate Bonds Initiative

While green finance is relatively new in the Philippines, the firstmovers in our market have been instrumental in introducing theconcept to our domestic investor base and making other local firms
aware of the potential for green finance. Importantly, most Philippine
green and sustainability bonds (roughly US$2.99 billion worth) havecarried the ASEAN Green or Sustainability label, with all ASEAN
labeled bonds also carrying second party opinions from noted
providers, such as Sustainalytics and Vigeo-Eiris. However, it should
be noted that one transaction which did not carry the ASEAN label– as it was issued prior to the implementation of the ASEAN GBS– was the very first labeled green bond issuance in the Philippines:
a nearly US$300 million geothermal transaction in 2016 that was
CBI certified. On that note, we thank CBI for playing a critical role injumpstarting our green market.
The continued development of the green and sustainability bondmarkets is also supported by the Philippines’ “whole of government”
approach to sustainable/ green finance. Recently, the Departmentof Finance established the Interagency Task Force on Green Financewhich consists of different government agencies to work toward
developing a Philippine Sustainable Finance Roadmap. The SEC also
instituted sustainability reporting for all listed corporations, and isa staunch supporter of the principles of the Task Force on Climaterelated Financial Disclosures (TCFD). The Bangko Sentral ng Pilipinas(BSP), recently published its sustainability framework for banks;
joined the Network of Central Banks and Supervisors for Greening
the Financial System (NGFS); and invested in $350 million of green
bonds for its own portfolio.2 The BSP also recently proposed theinclusion of green projects under an existing regulation that requires
banks to lend to targeted sectors.3 Most recently, President Dutertesigned the Energy Efficiency and Conservation Act of 2019 that callsfor 46,000 MW of energy savings by 2040.
This report will help the Philippines’ green market grow even fasterand build on what has already been accomplished. Hopefully, it
will also enable us to reach the next US$3 billion equivalent ingreen bond issuances. In addition to investment opportunities inrenewable energy and water management, this report identifies new
projects in untapped sectors, such as mass transport and solid waste
management. This detailed research coupled with the private sector’s
demonstrated engagement to date and the authorities’ commitment
to building a truly transparent green and sustainable financial market
make the Philippines an undeniably attractive destination for green
investments.
Mabuhay and welcome, Green Investors!
Sincerely,
Ephyro Luis B. Amatong
Commissioner
Securities and Exchange Commission

3

ADB Foreword
Asia and the Pacific’s economic progress in recent decades has beenremarkable, but there has been a price to pay: the region has become
the world’s leading source of greenhouse gas emissions. Asia andthe Pacific have a pivotal role to play in ensuring the attainment of
the Paris Agreement goals and mitigating global warming.
The Asian Development Bank (ADB) in committed to supporting
its developing member countries in tackling climate change.
ADB’s Strategy 2030 includes targets to build climate and disaster
resilience, address gender equality, and mobilize long-term private
financing. ADB is making good on its 2014 pledge to double
its annual climate commitments from $3 billion, mobilizing $7
billion total climate finance in 2019. $5.5 billion of this support willcontribute to mitigating climate change, and the $1.5 billion will
support adaptation.
As Asia and the Pacific begins to bounce back from the global
COVID-19 pandemic, it is imperative that the region’s recovery
strategies do not undermine achievements to date in reducing
dependency on fossil fuels and protecting the environment. There isbroad consensus that infrastructure plays a vital role in economic
growth and social development. To give real meaning to the term
“Build Back Better,” green and sustainable infrastructure needs to bemainstreamed in national renewal strategies.
In these uncertain times, access to financing to pay for reconstruction
is likely to remain challenging, as capital shies away from emerging
economies. ADB is working with governments across Asia and thePacific to address this shortfall by supporting strategies that catalyze
green finance from both the public and private sectors. To increase
green infrastructure, and help developing Asia achieve UN Sustainable
Development Goal targets by 2030, vast amounts of finance are
required. The growing global green bond market has been crucial ingenerating some of the financing required, but it must expand.

About the Asian Development BankADB is committed to achieving a prosperous, inclusive,
resilient, and sustainable Asia and the Pacific, while sustaining
its efforts to eradicate extreme poverty. Established in 1966,
it is owned by 68 members—49 from the region. Its main
instruments for helping its developing member countries arepolicy dialogue, loans, equity investments, guarantees, grants,
and technical assistance.

4

ADB has supported the green finance market in the Philippinesfrom its earliest days, facilitating the first project climate bondin the region through the AP Renewables green bond for the Tiwi
MakBan geothermal energy facility in 2016. To attract financiers
looking for green investment, the Philippines needs a prominent
pipeline of infrastructure investment opportunities that align withinternationally accepted definitions of green financing. This GreenInfrastructure Investment Opportunities report aims to showcase
this project pipeline, and highlight examples of the breadth anddepth of possible green investment opportunities in the Philippines.
ADB, is proud to support this important and timely report, throughtechnical assistance for the ASEAN Catalytic Green Finance Facility(ACGF), as part of a longstanding relationship with the Climate
Bonds Initiative in the region. We will continue to work together togrow green finance markets in the Philippines and the wider region
as we seek to meet our common goals of a prosperous region and asustainable planet.

Ramesh Subramaniam
Director General
Southeast Asia Regional Department
Asian Development Bank

About the ASEAN Catalytic
Green Finance Facility
The ACGF is an innovative finance facility under the
ASEAN Infrastructure Fund dedicated to accelerating green
infrastructure investments in Southeast Asia. It supports
ASEAN governments to prepare and source public and private
financing for infrastructure projects that promote environmental
sustainability and contribute to climate change goals. The
ACGF is owned by the 10 ASEAN member states and the AsianDevelopment Bank, which also administers the facility.

Philippines GIIO Report Climate Bonds Initiative

Green infrastructure: an opportunity for growth

The Philippines is one of the most vulnerable
countries to climate change, due to its highexposure to natural hazards, dependence
on climate-sensitive natural resources, andvast coastlines. According to the World Risk
Report in 2019, the Philippines ranks as theninth most vulnerable country to disasterand climate change-related risk among the
180 countries examined.6 On average, 20
tropical cyclones enter the Philippines region
every year, and about 8 or 9 of them directly
cross the Philippines.7 These numbers are
the highest in the world, and are expected
to increase in frequency and severity due
to climate change.8,9 In 2013, one such
destructive cyclone, Typhoon Haiyan, cost
4.7% of the country’s GDP.10
The significant scaling-up of investment
in green infrastructure is critical for thePhilippines to meet its climate commitments–including meeting global emission reduction
pathways under the Paris Climate Change
Agreement–and build resilience to the impactsof climate change as well as to achieve rapid
economic development. As a top priority
for the current Philippine administration,
infrastructure development is being heavily
supported and promoted in the Philippines.

Currently, much of the Philippines’ investment
in infrastructure is being carried out throughpublic funding and public– private partnership(PPP) ventures. However, public funding is
not sufficient to meet the growing demand
for green infrastructure; new channels will
be necessary to mobilise private capital.
Further, existing funding commitments madeby the government may be challenged by thecurrent COVID-19 pandemic and ensuingeconomic crisis, so looking to the market for
additional investment will be key to growing
green pipelines.
Globally, there is significant demand forgreen investments. Green debt instruments,
including green bonds and green loans— withproceeds used for climate-compatible andenvironmentally sustainable projects—provide
useful tools for private investors looking toinvest in green assets and projects. The firstever green bond from an ASEAN entity wasissued in 2016 by Philippine corporate, AP
Renewables. The Philippines’ bond market
now stands at USD 2.6bn and it is growing.
Due to the low interest rate environment
in developed markets, many international
investors have a strong appetite for

The post COVID-19 recovery should focus on sustainability
The world is in the midst of a major
crisis. In ASEAN, the global COVID-19
pandemic has triggered economic
recession that is impacting the livesof millions across the region - withprotective measures taken to prevent thevirus’s transmission shutting shut downlarge parts of the region’s economy.

blue bonds, depending on the type ofinvestment that supports the recovery.
Project inclusion for COVID-19 recovery
bond programmes could draw on green
taxonomies such as those developed in
the EU, ASEAN, and by the Climate Bonds
Initiative, augmented to include assetsthat explicitly enhance resilience.

Once this health crisis comes undercontrol, governments will need tofind ways to stimulate growth to get
economies moving again. All future
economic stimulus packages should aim
to contribute to building a healthier, more
resilient, and more sustainable economy.

As part of improving economic
resilience, bond programmes should
exclude activities which are at risk fromfuture shocks, for instance assets that
could become stranded as a result ofclimate policy changes, or which are
not resilient to climate physical risks.
Investor confidence can be built by using
available taxonomies with a high degree ofinternational recognition.

An opportunity exists to use green financeto fund COVID-19 recovery efforts. Bonds
could be issued as green, resilience orPhilippines GIIO Report Climate Bonds Initiative

better yield while at the same time being
constrained by either currency or credit rating
restrictions11 (below BBB). Even under the
pandemic, the Philippines has been able tomaintain its sovereign ratings at well above
investment grade (BBB+/BBB/Baa2) andstable outlooks from the three major ratings
agencies. Recently, the country received an
upgrade from the Japan Credit Rating Agency
to A- in June 2020.12 This offers an attractive
opportunity for investors to meet theirdemand for additional yield while still being
within credit rating constraints.

Country facts
Population: 109 million(July-2020)14
Population growth rate: 1.52%(2020)15
Urban population: 47.7% of the
population is urban (2020)16
GDP: USD376.80bn(Annual, 2019)17
GDP growth rate: 0.6% (Q1 2020)18
vs. 5.9% (Annual, 2019)19
Interest rate (cash rate): 2.75%(as of August, 2020)20 vs. 4.0%
(as at Dec, 2019)21
Inflation: 2.5%
(January to June 2020)22
vs. 2.6% (as at Feb, 2020)23
Net inflow FDI: USD507m(as of March, 2020)24
Government 10Y Yield: 2.64%(Daily, August 20, 2020)25 vs.
3.6% (Daily, June 23, 2020)26
Balance of trade: USD1.3bn(as of June, 2020)27
Government debt to GDP: 39.6%(Annual, 2019)28
Rating:
BBB+, stable (S&P)
Baa2, stable (Moody’s)
BBB (Fitch)© Climate Bonds initiative

The Philippines has been one of the fastest growing economies in
ASEAN (Association of Southeast Asian Nations) and is considered
the new tiger in Asia.4 The coronavirus disease (COVID-19) pandemic
has put some pressure on the country’s prospects in 2020; however,
economic growth is expected to rebound gradually in 2021–2022,
as global conditions improve.5 The process of recovery from the
COVID-19 crisis needs to focus on building back better, by prioritisinggreen infrastructure and nurturing a regulatory environment thatfacilitates green and innovative investment.

A-, stable(Japan Credit Rating Agency)
5In order to attract investors looking for green,
the Philippines needs to be sure that there is
a visible pipeline of infrastructure investment
opportunities that align with internationallyaccepted definitions of green.
There is often limited awareness andappreciation among some market
participants of ‘what are green investments’beyond solar and wind energy. The lack ofunderstanding of what are green investments
makes it difficult for governments to develop
pipelines of commercially viable, green
infrastructure investment opportunities thatare able to support the nation’s transition toa low carbon economy.
Green infrastructure has positiveenvironmental and economic benefits.
It can create prosperity by increasing

competitiveness, productivity, andemployment opportunities; extending thereach, reliability, and efficiency of the national
electricity grid without creating air pollution;broadening the economic base; creating
new markets; and providing inclusion andconnectivity across the Philippines.13
The identification of green infrastructure
investment opportunities in the Philippines
can help investors understand that there is asufficiently large pool of financially attractive
investments that are also green.
Knowledge of a large pool of green investments
available means that investors can realise there
are viable alternatives to non-green assets andprojects, and they can make their preferencesfor green heard, which will in turn spur thecreation of a larger pool of green investments.

Improving the general investment
environment as well as promoting
more green finance will help to fund theinfrastructure necessary to meet climate
targets. This means continuing to open up
to investors looking for green and ensuring
there is a pipeline of bankable, investmentready opportunities. These measures will
ensure the Philippines is on the path totransitioning to a low carbon economy andbecoming more resilient to the impact ofclimate change and other global shocks.
Delayed action in transitioning to a low
carbon economy increases the cost ofchange as well as the volatility and structuralrisks to the finance sector and underlying
asset values.

Snapshot: Macroeconomic outlook

Prior to the pandemic, the economy of thePhilippines was doing well. The Philippines
has been one of the fastest and largest
growing economies in ASEAN, with anaverage GDP growth of 6.6% from 2016
to 2019.32 Despite challenging global
circumstances, such as the U.S.–China
trade uncertainties, the Philippines grewat a moderate and steady pace in 2019:the country’s annual GDP growth in 2019was 6%.33
The growth in 2019 was largely driven
by private consumption, which regained
momentum with lower inflation.34
The Central Bank of the Philippines
successfully adopted an accommodative
policy stance that stabilized the prices
for food and energy, which led to thePhilippines’ lowest rate of inflation inalmost three years: 1.7%, as at August
2019.35 The government also prioritizedreform that opened new sectors to foreign
investment and improved competition.36
In 2019, the government implemented

6

In late 2019, predictions were made that
there would be an annual GDP growthof about 6.5% in 2020,38 and that theheadline inflation was to remain stablebetween 2.5%–3.3%.39 Public investment
in infrastructure was anticipated to be thedriving force of economic growth in 2020,
as nearly a quarter of the 2020 budget
was allocated to infrastructure.40 By 2022

infrastructure was expected to reach 7%
of GDP compared to 2% of GDP before
President Duterte took office in 2017.41
As the economy is put under pressureduring this crisis and public spending isredirected to priority areas for recovery,
there is the risk that this predicted
infrastructure growth will stall. However,infrastructure is necessary for a return toeconomic growth.
Ensuring this infrastructure in green
would aid in increasing the nation’s
resilience to future shocks and help tobuild a more sustainable society.

Infrastructure investment forecast 2016-2040,
sector breakdown in terms of GDP
400
350
300
250
Source: tradingeconomics.com World Bank

The Philippine economy is expected tocontract by 1.9% in 2020 due to theeconomic fallout triggered by recent
natural disasters and the COVID-19
pandemic, according to the World Bank.29
The economy already contracted by 0.2%
year-on-year in the first quarter of 2020,
the first contraction in over two decades.30
However, the economic outlook for thePhilippines is optimistic, with the WorldBank suggesting the country could bounceback in the next two years.31

the Ease of Doing Business Act, aimed
at reducing red tape and streamlining
business approval processes.37 Further,President Rodrigo Duterte’s 2019 Build
Build Build campaign significantly increased
infrastructure funding.

150
100
USD billions

Green finance presents an opportunity inpromising macroeconomic conditions.

50
0
2010

2012

2014

2018

2020

Philippines GIIO Report Climate Bonds Initiative

The Philippines ramped up public infrastructure spending in recent
years, with another spending surge planned during 2021-22

Infrastructure pipelines have been
growing, with more opportunities
emerging for outside investment.

Issues such as poor transport facilities andlimited access to reliable water supply andsanitation have hindered economic andsocial development over the last decade.
On average, drivers in the Manila Metroarea spend up to 71% extra travel time
due to the traffic.42 The problem of traffic
congestion in the Philippines has become
increasingly urgent for the government toresolve, as it has caused economic losses
and otherwise negatively affected thoseliving in the Greater Metro Area.
According to the Japan International
Cooperation Agency (JICA), in 2018,
At the end of 2019, the Philippines
Investment Coordination Committee (ICC)
and the Committee on Infrastructure(INFRACOM) jointly identified 100 big-ticket
infrastructure projects to be added to thenational project pipeline.47 However, since
the pandemic, the list of flagship projects has
been revised to reflect COVID-19 response
better. The Build, Build, Build (BBB) program
now consists of 104 big-ticket infrastructure
projects worth PHP4.1tn (USD84.46bn),
instead of the initial 100 projects prior to thepandemic.48 In the revised list of projects, 8
projects were replaced by 13 priority projects
that are responsive to the pandemic.49 These
additional 13 projects are aimed at the ICT,
water, transportation, digital economy andthe health care sector.50
Despite the setback from the reallocation
public infrastructure budget for COVID-19
emergency response in Q1, the total spending
for infrastructure is expected to bounce backin 2021 as the National Expenditure Program(NEP) has recently approved an infrastructurebudget of PHP1.107tn (USD22.8bn) for
FY2021. This total approved budget amounts
to 5.4% of the GDP, a significant increase
from the public infrastructure budget of 4.6%of the GDP in 2020.51

54
3
2% of GDP

Infrastructure planning and spending
in the Philippines has been among themost ambitious in the Southeast Asian
region. The Government of the Philippines
dubbed 2019 as the ‘The Golden Year of
Infrastructure.’ In President Duterte’s 2017
State of the Nation Address, he highlighted
that the Philippines’ poor quality of
infrastructure and heavy traffic congestion
are major challenges to be overcome, which
he intended to do through massive andambitious infrastructure development.

6

10
2011-16

2017

2018

2019

it is estimated that the Philippines loses
USD70m (PHP3.5bn) per day due to heavy
traffic congestion. If this remains unresolved,
the country is estimated to lose USD107m(PHP5.4bn) per day in 2035.43 Further, thelack of sufficient infrastructure is significantly
undermining its competitiveness globally, as
warned by the World Economic Forum.
In response, the government has been
investing more in infrastructure. In 2017,
the government hit a record with an
infrastructure-spending-to-GDP ratio of
5%, the first time it hit such a record in
the past 30 years.44 The ambitious Build,
The administration has set the BBB programas the central driver for economic recoveryof the country.52 This approach was echoedby the IMF, who said that the Philippines’
government realignment of its flagshipinfrastructure projects will help the country’s
economy to recover faster.53 Secretary Mark
Villar from the Department of Public Worksand Highways (DPWH) noted that evenunder the pandemic the BBB program will
generate estimated 1.5 million jobs by theend of 2020.54
To boost the state budget and allow forsuch ambitious infrastructure spending,the government had committed to an
expansionary fiscal strategy which includes
enforcing tax reform and increasing its
total debt to meet the funding needs.55
This included a policy from the BBB
funding strategy, to increase in the fiscal
deficit from 2% to 3% of GDP until 2022,
and increase in the tax revenue throughthe Comprehensive Tax Reform Program(CTRP).56 This economic reform is expected
to generate an estimate of USD2.6bn(PHP126bn) in tax revenue.57 In light of the
COVID-19 pandemic, Package 2 of the CTRP
was recalibrated to make it more relevant
and responsive to the needs of businesses,

Philippines GIIO Report Climate Bonds Initiative

2020

2021

2022

Source: Department of Budget and Management; IMF staff estimates61

Snapshot: Infrastructure
spending

Build, Build programme, put forward by
President Duterte, aimed to have raised
infrastructure spending to 7% of GDP by
the end of 2019.
PHP9tn (USD185.4bn) is required toachieve the infrastructure development
targets between 2017 and 2022, coveringtransport (as a priority), water resources,and energy, as detailed in the Philippine
Development Plan.45 If the government
can meet its targets, specifically fortransport, there could be an estimatedsaving of up to USD47.4m (PHP2.29bn)
per day from reduced traffic congestion.46
especially those facing financial difficulties,
and to increase the ability of the Philippines
to attract investments that will benefit the
public interest.
During the Development Budget
Coordination Committee (DBCC) FY 2021
Proposed Budget Briefing, NEDA’s Acting
Secretary Karl Kendrick Chua indicated that
it will continue to pursue the liberalizationof the economy to attract more investment
and jobs through the amendments of PublicService Act, Foreign Investment Act, and the
Retail Trade Liberalization Act.58
In addition, to help attract private investors,
the government is accepting moreunsolicited public-private partnership (PPP)
proposals from the private sector, according
to a statement by the Presidential Adviser
for Flagship Programs and Projects, Vivencio
Dizon.59 Based on NEDA estimates, about
USD25.3bn (PHP1.23tn) could be available
via PPPs.
Ideally, the government’s infrastructure
investment prioritization and its economic
reforms will attract greater private
investment into the country, despite the
COVID crisis.60

7

“The government plays a central role incatalyzing strategic climate-resilient actions,particularly in harnessing private sector
engagement. While the public sector
takes most of the responsibility to drive
climate change solutions, it has become
increasingly clear that the private sector
is an essential partner in preparing forand responding to the impacts of thisphenomenon. In other words, public
private partnerships (PPPs) are key inbuilding a green and resilient economy. The
private sector can contribute not only inbridging the infrastructure gap but also
in implementing and innovating climatechange solutions that encompass technicaland sector-specific expertise, greater levelsof financing, and efficiency, making it anindispensable ally.

to the changing climate. Recognizingthat the country is also trying to close theinfrastructure gap, our efforts and callto action toward this goal to accelerate
infrastructure spending must also take into
account the need to develop and make theseinfrastructures climate resilient. This isnecessary in order to avoid costly damage
to properties and to minimize the potential
negative impacts of climate change bymaking our infrastructure responsive andclimate adaptive. To help address thisconcern, PPPs will be critical. Under awell-designed regulatory environment, PPPs
can be one of the most viable options tomaximize the innovation and resources ofthe private sector, while the government
orchestrates collective action throughprograms, projects, and policies.”

Efforts toward climate change adaptationand mitigation are crucial, as the Philippines
is classified as one of the most vulnerable

Maria Lerma L. Advincula, Director of
Project Development Service, Public Private
Partnership Center63

Accelerating the development of
the green PPP project pipeline

200 participants. This forum enabled theIAs and LGUs to learn new climate change
technologies and systems, best practices
in adaptation and mitigation, and provided
interaction with private sector developers
and sponsors. Aside from providing technicalassistance on traditional infrastructure
projects, the PPP Center also provides
assistance in emerging and non-traditional
sectors such as health, tourism, verticalinfrastructure or green buildings, waste-toenergy, water and sanitation, solid waste
management, and projects with climatechange adaptation features.

In strengthening the Philippines’
commitment to a sustainable and resilient
economy, the Public-Private Partnership(PPP) Center of the Philippines further
intensified its technical assistance in thedevelopment and implementation of climatechange-resilient PPP projects, particularly at
the local and regional levels outside Metro
Manila. Supported by ADB’s Urban Climate
Change Resilience Trust Fund (UCCRTF),
the PPP Center helps assist the capacities
of local implementing agencies (IAs) toprepare and identify projects that can beconsidered as green.
Generally, these are projects that contributeto climate change mitigation and adaptation
solutions. To provide a pool of experts forthese projects, the PPP Center establisheda new Project Development and Monitoring
Facility (PDMF) Panel of Consultantsfor Resilient PPP Projects of Local
Implementing Agencies. Through this panelof consulting firms, local IAs may accessa pool of PPP experts with proficiency inclimate change resiliency which will provide
assistance in developing and implementing
their PPP projects.
The PPP Center, with the support of ADB,
held major fora for local and national IAs,
local government units (LGUs), and theprivate sector to enhance the capacities of
IAs and LGUs to respond to climate change
adaptation in their PPP projects, one of whichis the Renewable Energy and Waste-toEnergy Forum, held in August 2019, with over8

“Green investment is increasingly being
embraced as key to maintaining the
integrity of our natural capital and establish
measures that will reduce environmental andclimate risks. When our nature collapses,
revenue losses are inevitable, which could
result in major socioeconomic setbackin the long run. Given this, the National
Economic and Development Authority
ensures that environmental and climateparameters are integrated in our nationaland sub-national development plans, andin the design of public investments andportfolios, to ensure our achieving a more
resilient and sustainable economy. The
Philippine Development Plan 2017-2022,
in this regard, already gives priority to theinstitutionalization of green finance policies
to help both the public and private sectors
improve their access to available green
finance facilities, scale up investments
and facilitate more partnerships andcollaboration. We need to strengthen thatshared commitments and actions between
the government and the private sector toredefine and leverage investments that will
propel green and sustainable economic
growth. We need that same sharedcommitment to accelerate efforts to effect a
positive behavioral change towards a moresustainable and climate -smart lifestyle
towards a healthy and resilient Philippines.”
Nieva T. Natural, Director of Agriculture,
Natural Resources and Environment
Staff, National Economic andDevelopment Authority62

To enhance the policy framework within
which PPPs operate, the PPP Governing Board(PPPGB) passed a resolution in 2018 that aims
to integrate environmental and other safeguards
into the entire PPP project cycle.64 Suchintegration can serve as a robust benchmark
for the Philippines’ effort in accelerating thedevelopment of green infrastructure projects. In
the future, the Philippines could potentially use
a sectoral approach to identify how different
infrastructure sectors contribute to reducing
GHG emission and to further align the growth ofgreen projects with its national climate targets.

Philippines Public Investment
Program
The 2017-2022 Public Investment Program(PIP) is a rolling list of priority programs andprojects (PAPs) to be implemented by thenational government, government-owned
and controlled corporations (GOCCs),
government financial institutions, andother national government offices andinstrumentalities. The PIP, which is anaccompanying document of the Philippine
Development Plan (PDP), is aimed atcontributing to the achievement of thesocietal goal and targets of the PDP and
responsive to the outcomes and outputsof its Results Matrices (RM). The PAPs
are chosen and prioritized based on theirability to contribute to these targets,
outcomes and goal of the Plan. These may
be financed using national government
funds, including internal revenue generated
by GOCCs, in partnership with the private
sector or through Official Development
Assistance (ODA).65
NEDA will facilitate the issuance of the Joint
Call for the updating and revalidation of the
2017-2022 PIP and the formulation of theThree-Year Rolling Infrastructure Program(TRIP) for FY 2022-2024 as input to the FY
2022 budget preparation. The TRIP contains
the priority infrastructure PAPs requiring
national government funding and aims tosynchronize the infrastructure planning,
programming, budgeting and execution
processes of the government.66

Philippines GIIO Report Climate Bonds Initiative

Philippine Action Plan for Sustainable Consumption and Production (PAP4SCP)The National Economic and Development
Authority (NEDA) developed the Philippine
Action Plan for Sustainable Consumption
and Production (PAP4SCP) with support
from the Asian Development Bank
(ADB). The PAP4SCP will serve as a
guiding framework to influence and steer
sustainable practices and behaviour
across sectors and levels of government
by implementing programmatic policy
reforms and actions over the short(2020-2022), medium- (2022-2030),
and long-term (2030-2040). It will

also contribute to achieving the country’s
Ambisyon Natin 2040 by laying down
the policy reforms and actions to ensurethat the present and future generationsof Filipinos will enjoy a “matatag (strongly
rooted), maginhawa (comfortable) at panatag
na buhay (secure life).” The overall goal of
the Plan is for more Filipinos to consume andproduce green goods and services toward
more sustainable and climate-smart lifestyles.
One of the four action nodes in the PAP4SCP
is infrastructure. The plan intends to pursue

green infrastructure development that will
facilitate timely environmental monitoring(e.g. ICT infrastructure), improve waste
management (e.g. sanitary landfills,
recovery/reuse, recycling and repair
facilities, wastewater and sewage/septage
treatment facilities), scale-up sustainableurban mobility solutions (e.g. car sharing,bike lanes/sharing, walkways), andpromote resource-efficient and climatesmart practices and lifestyles (e.g. green
buildings/facilities, off-grid renewableenergy systems), among others.

Snapshot: Climate policy
The Government of the Philippines isfirmly committed to the Paris Climate
Agreement.
The effects of climate change and therisks associated with a greater than 2°C
rise in global temperatures by the endof the century are significant: rising sea
levels, increased frequency and severityof hurricanes, droughts, wildfires andtyphoons, and changes in agricultural
patterns and yields. The Global Climate
Risk Index 2020 also places thePhilippines in the top five most vulnerable
nations in the world.67
As a country so vulnerable to the impactsof climate change, when the Philippines
ratified the Paris Agreement on March
2017, they were sure to set an ambitious
emission reduction target: committing to
cut its emissions by 70% below businessas-usual (BAU) by 2030.68 This target
was preceded by years of policy andregulation striving to curb the effects ofclimate change.
As early as 2009, the Government of
the Philippines had identified thenecessity to mainstream climatechange into development, as detailed
in its Climate Change Act 2009.69
Then, in 2010, the country’s Climate
Change Commission (CCC) formulated
the 2010-2022 National Framework
Strategy on Climate Change, which
identified the long-term mitigationand low-carbon sustainable growthtargets for the Philippines. The National
Climate Change Action Plan (NCCAP)
2011-2018, introduced in 2011, detailed
specific activities and outputs in different
sectors such as developing a national
renewable energy program for the energy
sector and developing climate resilience
infrastructure for the water sector.70

Other key programs developed by the CCC
include:2016: Development of The Green Jobs
Assessment And Certification System And
Guidelines71
2017: Development of A National
Framework And Plan Of Action For
Philippine Climate Smart Hospitals72
2019: The Communities for Resilience(CORE)The Comprehensive Integrated Climate
Change Adaptation and Resilience
Program for the Indigenous Peoples73
Monitoring Of Climate Change Related
General Appropriations Act Provisions 74
National Climate Risk Management
Framework75
2020: Development of Standards
For Climate Smart Buildings (underdevelopment)76
In 2019, the government introduced
an interagency green task force led by
the Department of Finance (DOF) tofacilitate the harmonization of climate
policies across government agencies. The
green inter-agency task force will seek toharmonize existing sustainability policies
by identifying policy or technical gaps
then allocating the appropriate resources
to address these gaps. At the moment,
the task force is working with the SEC andCentral Bank to create a green taxonomy
that outlines what projects constitute as
green and ensure that these definitions areamenable to all government agencies.77
The green interagency task force aligns
with President Duterte’s instruction to
involve all relevant ministry agencies toharmonize climate change and disasterrelated risk solutions across the whole

Philippines GIIO Report Climate Bonds Initiative

government.78 Further, the President
has also urged to further accelerate thePhilippines transition into a sustainableeconomy as he notably raised in
his 2019 fourth State of the Nation
Address. The President stated that to“fast-track renewable energy projects
to reduce dependence on coal is thesignal policymakers need to hear.”79 The
country’s dependency on coal remains oneof the challenges in reducing the country’s
overall GHG emissions.
In 2019, the Philippines passed the Energy
Efficiency and Conservation Act into
law, which aims to reduce overall GHG
emission demand by 24% below BAU
by 2040.80 This Act requires all local
government units (LGUs) to implement
their own local energy efficiency plansby 2022.81 It is anticipated that the Act
will result in 46,000 MW in energy
savings by 2040. There is also ongoingwork to improve the climate ambitionin the country’s Nationally Determined
Contributions (NDC), which is planned to
be updated by 2020.82,83

The Philippines’
climate goals
As part of its NDCs under theParis Agreement, the Philippines has
defined the following
mitigation targets/ GHG emission
reduction targets:• 70% reduction by 2030, compared
to business-as-usual scenario of
2000-2030
Reduction of CO2 emissions will comefrom energy, transport, waste, forestry,
and industry sectors.

9

Green finance trends and opportunities
Global demand for green
is growing
There is a strong green financemomentum globally and significant
further growth potential.
Green-labelled products have become
globally recognised as an effective meansof directing investment capital towards
climate change mitigation and climate change
resilience and adaptation projects, including
green infrastructure. The growing level ofinterest from investors in green projects has
resulted in the development and growth ofinnovative financial products including green,social, ESG and sustainability bonds andloans; and green index products. In the future,green COVID-19 bonds may find a place inthis list of themed green instruments.
Green bonds are currently the most developed
segment of thematic instruments, carrying
greater recognition from the investor base.
To combat the effects of climate change, it isestimated that green bond issuance needs toreach USD1tn per annum by the early 2020s. A
significant amount is expected to finance green
infrastructure and assets in emerging markets.

“As ASEAN grows and steadily fulfils its
economic potential, opportunities exist
across a wide range of industries. For
example, ASEAN has over USD2tn worthof infrastructure investment opportunities– not just traditional ports, roads, andbridges, but support in ICT, education,
agriculture, and healthcare.”“We have some very long-term horizons.
If you’re a long-term investor, you canfocus on specific areas, like Southeast
Asia funds... [where] there is a sourceof growth.”
Ted Lee, Senior Portfolio Manager,
Canadian Pension Plan Investment Board86

Alexander Feldman, President & CEO,US-ASEAN Business Council84

ASEAN is increasingly appealing to investors
Several foreign entities, including
development banks as well as foreigncommercial banks, have issued green bonds inlocal ASEAN currency bonds demonstratinginterest in these domestic markets. Other
green bond issuers such as BNP Paribas,
Société Générale, Bank of America and NAB
have issued vanilla bonds in at least oneof the local ASEAN currencies. Issuance inlocal currency allows foreign issuers to tap
domestic investors for capital. Interest in
ASEAN markets continues to grow.

“In recent years there has beensignificantly more engagement frominstitutional investors for integrating ESG
in their investment process [in ASEAN]
and the wealth management industry is
now following.”
Valentin Laiseca, Head of ASEAN Index
Sales, MSCI85

CBI’s Green Bond European Investor Survey shows interest in investment in emerging markets
CBI’s Green Bond European Investor
Survey shows interest in investment
in emerging markets.
Outstanding emerging markets (EM)green bonds, as of 30 April 2019,
amounted to USD114bn, or around 20%of the green bond market. Meanwhile, EM
currently contribute 63% to global GHG
emissions.87 It is thus critical to determine
how investors can support the expansionof EM green bonds.
Respondents of CBI’s Green Bond European
Investor Survey were asked to describe theirappetite for EM green bonds and to outline
what they could be receptive to buying.
Most respondents (82%) can buy EM debt,
with exposure limits at country and issuer
level tending to apply more to respondents
that have a greater degree of integration ofgreen bonds. However, the most common
restrictions are credit rating (69%),
currency (65%) and deal size (58%).88
As most respondents can and would liketo buy EM green bonds, EM issuers must
consider how these requirements can bereconciled. Respondents expressed that10

they would like to increase their holdings in
EM sovereigns. Countries such as Indonesia(two bonds in USD), Seychelles (USD) and
Lithuania (EUR) have issued green bonds
and were met with a positive reception frominvestors. The Philippines has USD issuers ofgreen and sustainable bonds.89
Three quarters of respondents able to buy
EM green bonds treat EM differently fromdeveloped market green bonds, statingthat they require more evidence of integrity
to invest in green bonds from EM. So,
respondents were also asked to rank factorsthat could make investing in EM green
bonds more attractive and bring scale to themarket. Credit enhancements available frommultilaterals and/or public sector entities
was the most frequently selected option,with more than half considering it importantor very important.90

2. Reliability, e.g. external reviews (SPO,
audit, certification, etc) (48%),
3. Risk, e.g. insurance/CDS/guarantees,
size of issue, currency (25%).
More information on this topic canbe found in the Green Bond European
Investor Survey, on the CBI website.

2019dGreen Bon vestor
In
n
a
e
p
Euro
y
e
Surv

When respondents were then asked
which features would give them more
confidence to invest in EM green bonds,
they listed the following:91
This repor

1. Transparency, e.g. adherence to GBP,
reporting Use of Proceeds (65%),

red by thet was prepa

Sponsoredby Luxembourg

Climate Bonds

Initiative, witht Suisse, Lyxornge, Credi

Stock Exchartanalysis suppoy Businessfrom Henle

gement andAsset Mana

School.

Danske Bank.

Philippines GIIO Report Climate Bonds Initiative

Green finance is growing
in the Philippines
The Philippines is a leader in green
finance in ASEAN.
The Philippines has been increasingly
exploring the use of green debt as well as
equity instruments and has been expanding
credit enhancement mechanisms and risk
sharing options. This includes green bonds
and green loans, credit guarantees, andguarantee funds, as well as specialty funds
for green infrastructure and renewableenergy (see Annex I through IV for more
information on green financial instruments
and mechanisms in the Philippines). There
has also been some ‘greening’ of the stock
exchange and domestic banking.
To date, four domestic banks, the Bank of thePhilippine Islands (BPI), Rizal Commercial
Banking Corporation (RCBC), China Bank
and BDO Unibank, have issued green bondsin three currencies: US Dollar, Philippines
Peso and Swiss Frank with issuance in eachcurrency amounting to USD600m, PHP15bn(USD309m), and CHF100m (USD108.6m)
worth of green bonds. It is worth notingthat the BPI CHF bond had a negative yieldand is an example of a green bond thatmeets investor Emerging Market’s (EM)appetite for EM exposure with low credit
risk (BBB+). The Development Bank of thePhilippines (DBP) also issued a PHP18.12bn
Sustainability bond, in which some proceeds
were allocated for green projects.93
The government has also been developing
national and regional policies for facilitating
further growth in green finance. In 2019, thePhilippines became members to the new
Coalition of Finance Ministers for Climate
Action and its Helsinki Principles, which
promote national climate action through fiscal
policy and the use of public finance. Prior to thiscommitment, the government and regulators
have long been moving in this direction.
The Securities and Exchange Commission (SEC)
Philippines has been leading the country’s workin green finance at the ASEAN Capital Markets
Forum (ACMF), as the co-chair to the ACMF
Sustainable Finance Working Group. In thisrole they have been central to the developmentof the ASEAN Green Bond Standards, ASEAN
Social Bond Standards, and ASEAN Sustainable
Bond Standards as well as the Roadmap for
ASEAN Sustainable Capital Markets. They
have also represented ACMF at the Advisory
Council of the Green Bond Principles andSocial Bond Principles Executive Committeeof the International Capital Markets
Association (ICMA).

“European industry still overwhelmingly
sees ASEAN as an attractive region forgrowth and investment, as our 2017
Business Sentiment Survey showed. Butthat survey also showed a strong call for
more progress on government initiatives toreach trade agreements, reduce barriers totrade, and realise the vision of the ASEAN
Economic Community.”
Donald Kanak, Chairman, EU-ASEAN
Business Council92“ThomasLloyd has been an investor andpromoter of renewable energy in thePhilippines for 10 years. Our work on
Negros Island shows the huge opportunity
to develop further its renewable energy
and sustainable infrastructure capacity, todeliver the triple benefits of environmental
protection, social improvement andfinancial returns.”
Tony Coveney, Managing Director, Headof Project Finance and CEO Americas,
ThomasLloyd GroupThe ASEAN Green Bond Standards
The ASEAN Green Bond Standards94 arebased on the ICMA Green Bond Principles
and seek to enhance transparency,
consistency, and uniformity to help
reduce issuance and investment costs.
Key elements of the standards include
the following:• the issuer or issuance of the green
bond must have a geographical or
economic connection to the region;• fossil fuel power generation projects
are explicitly excluded;• information on the process for project
selection and on the use of proceeds
allocation, as well as the external
review report must be made publicly
available on a designated website;• recommendation to obtain an external
review for the green bond framework,
and is particularly recommended for the
management of proceeds and annual
reports; and• recommendation for the external
review providers to disclose theirrelevant credentials and expertise andthe scope of the review conducted.

Led by the SEC, the Philippines has developed
complimentary Guidelines on the Issuance ofGreen Bonds Under the ASEAN Green Bonds
Standards in the Philippines (SEC MC. No. 12,
s. 2018). It has also developed the Guidelines
on the Issuance of Social Bonds Under
the ASEAN Social Bonds Standards in thePhilippines (SEC MC. No. 9, s. 2019) and the
Guidelines on the Issuance of Sustainability
Bonds Under the ASEAN Sustainability Bonds
Standards in the Philippines (SEC MC. No.
9, s. 2019). Using these guidelines, the firstgreen bond from the Philippines, under the
ASEAN Green Bond Standards, was issued
by Rizal Commercial Banking Corporation(RCBC) who is also the first entity to haverelease a Green and Sustainability Bonds
Impact Report in the Philippines.
“We hope to build on our rapid, private
sector-led entry into the green andsustainable market to become one of theleaders in ASEAN. We’ve received a lot of
positive feedback from existing green bondissuers in the Philippines. They found theprocess to work well, particularly when using
the ASEAN Green Bond Standards. Whenwe created and adopted this standard it
provided people with a clear reference point

Philippines GIIO Report Climate Bonds Initiative

to help them along to issue a green bond.
The market really sees the importance ofusing a defined standard.” Commissioner
Ephyro Luis B. Amatong, Securities andExchange Commission (SEC)The SEC are also representing the country
in another body for green finance: becoming
a member of the UK Prosperity FundASEAN Low Carbon Energy Programme(LCEP) Green Force in 2019. This is a
4-year programme of policy support,
capacity building and technical assistanceto the participating governments. Thisaims to facilitate green finance flows andimprove the regulatory, policy and practicalconditions for energy efficiency measures.95
The Government of the Philippines iscommitted to greening the economy, as
evidenced by the establishment of theGreen Task Force, led by the Departmentof Finance (DOF). Policies encouraging
public investment in green infrastructure
have the potential to set the Philippines ona sustainable development pathway for thelong run - sending an important signal tothe market and providing an opportunity forthe country to access new capital.

11

Snapshot: The Philippines green bond market opportunity
The first green bond from ASEAN was
issued in February 2016 by AP Renewables,
Inc., a wholly owned subsidiary of Aboitiz
Renewables, in the Philippines. Since then,Southeast Asian green bond issuance hasgrown, and the ASEAN market continues tohave significant growth potential.
Globally, the volume of green bond andloan issuance rose sharply, from USD171bn
in 2018 to USD259bn in 2019, buoyed
by strong interest from both investors
and issuers. Mirroring this trend, ASEAN
issuance, supported by new regulation, also
grew strongly, reaching USD8.1bn in 2019from USD4.1bn in 2018, representing 3% of
the global total and 12% of the Asia Pacificregion. As at August 2020, the cumulative
ASEAN issuance stood at USD15.4bn.96

huge infrastructure opportunity could see
the Philippines accounting for a greater
share of the green bond market than its
share of emissions.
Despite the economic pressures of the
COVID-19 crisis, green bond issuance
continues in most of the world. It is
expected that this trend will be reflectedby the ASEAN market, so the outlook forthe region is optimistic.
For more information on the ASEAN green
bond market, please see the Climate
Bonds report: ASEAN Green Finance Stateof the Market 2019.

Globally, it is estimated that green bondissuance needs to exceed USD1trn perannum to meet the goals of the Paris
Agreement.97,98 With the Philippines
accounting for 0.35% of global emissions,this could translate into USD3.5bn
per annum – or just over double 2019issuance. Given that the global green bondmarket has to quadruple in size to meet
the USD1trn target (2019 issuance was
USD257bn), the Philippines is already on
track. But the potential is far greater - thelevel of capital market development anden Finance
ASEAN Gree Market
State of th
2019

Sovereign

green bondWorld’s firstgreen sukuk
te Bond

Certified Clima

USD27mVietnam,Thailand,Philippines,

USD947m

USD2.02bn“We have been active both locally, andinternationally, the DOF is a member ofdifferent international working groups
that are focused on mainstreaming green
finance. Internally, what the DOF has
been doing is to call on different agencies
through an inter-agency group that wecall Green Force, which we are trying towork with the UK government through theprosperity fund. The goal of the interagency panel is to harmonize different
government policies related to green or
sustainability, and how finance can help
them. Without the DOF actually steppingin to promote green finance [through thegreen task force], it was hard for
the Climate Change Commission (CCC)
alone to work with other government
agencies on how you can craft aworkable NDC target that is acceptable
to all line agencies. “Assistant Secretary Paola Alvarez,
Head of the Green Task Force,
Department of Finance.

n

USD1.34b
Malaysia,

Indonesia,

USD2.88bn

USD6.20bn
Singapore,

Data as of

31 December

2019

Supportedby HSBCe by the1With a featur
opment Bank
Asian Develive
ive
Bonds Initiat
te Bonds Initiat
the Climate
t 2019 Clima
Prepared byof the MarkeASEAN StateASEAN Green Bond market (as at August 2020)

Vietnam USD27m

Thailand USD947m

Sovereign green bondCertified Climate BondFirst global green sukuk
Philippines USD2.02bn

Malaysia USD1.34bn
Singapore USD6.20bn

Philippines first Certified Climate Bond
Issuer: AP Renewables
Instrument: Green bond
Sector: Energy Geothermal
Issuer type: Non-Financial Corporate
Amount: 10,700m
Currency: PHP
Date issued: 29 February 2016

External review: Certified Climate Bond,certified under the criteria for Geothermal,
verification by DNV GL

Indonesia USD2.88bn

12

Use of proceeds: Tiwi-Mak Ban
geothermal power plant

Philippines GIIO Report Climate Bonds Initiative© Climate Bonds initiative

Maturity: 28 February 2026

The Philippines is the 3rd largest
green bond issuer in ASEAN
The Philippines is a leader in the ASEAN
green bond market. In addition to issuing
the very first green bond in the region - theAP Renewables’ USD226m deal in early2016 - it also issued the first Climate Bonds
Certified green bond, a sign of best practicein the market in terms of climate ambition.
The growth of the green bond market in thePhilippines is notably driven by the private
sector. To date, only one government entity
has issued a green bond.
As of August 2020, Philippine entities had
issued over USD2.6bn of green bonds (seemethodology notes on Page 14), the majorityof which were issued in 2019. 2019 wasa record year for green bond issuance byPhilippine entities, mostly in USD. Most of
the proceeds were allocated to renewableenergy. The largest issuer of green bonds in
the Philippines is AC Energy, with four green
bonds outstanding, ranging in size from
USD75m to USD400m.
In 2020, two more bonds by Arthalandand AC Energy were issued. Arthaland, apublicly listed company developing green
properties in the Philippines, issued a
PHP3bn (USD59.1m) issuance with the useof-proceeds for green buildings. AC Energy
issued a USD60m green bond with theuse-of-proceeds for renewable energy. This
brings the cumulative green bond issuance in
the Philippines to USD2.6bn.
In addition to the 13 green bonds, 2
sustainability bonds have also been issued
amounting to USD796m.99 We note herethat green bonds in the Climate Bonds
database are screened to ensure alignment
with the Climate Bonds Taxonomy. As there
is no established social taxonomy yet, bonds

with proceeds allocated to social projects(Sustainability and Social Bonds) are not yet
included in the Climate Bonds Initiative (SeeMethodology box below).
Four banks have issued green bonds in thePhilippines, with RCBC and, BBB+- rated,
Bank of the Philippine Islands (BPI) making their debuts in 2019. The issue by
BPI was particularly noteworthy, as it was
the first CHF-denominated, offshore green
bond for the Swiss market and achieved anegative yield of -0.02%, which was inside
the initial price guidance. This issuancereceived significant interest from investors,
being heavily oversubscribed in a shorttimeframe, and, according to some market
participants, achieved the largest issuancediscount for a Southeast Asian bank since2016.100 It was also followed five days laterby the issuance of a USD300m seniorunsecured five-year green bond. The Green
Finance Framework published by BPI is inline with the ASEAN Green Bond Standards
and the use of proceeds includes
renewable energy, energy efficiency,
sustainable water and wastewater
management, pollution prevention andcontrol, and green buildings.101
RCBC issued in February 2019 PHP15bn of
1.5-year green bonds, a three-fold increase
from the PHP5bn, initially planned in
response to “overwhelming” demand frominvestors. It also carried the ASEAN GBS
label. The proceeds from the issuance were
earmarked for the refinancing of loans andnew lending in renewable energy, green
buildings, clean transportation, energy
efficiency, and pollution prevention andcontrol. Later in the year, it issued its firstsustainability bond, a USD300m five-year
deal to finance energy, buildings, transport
and waste projects.102

Philippines GIIO Report Climate Bonds Initiative

AC Energy, a subsidiary of Ayala Corporation,
first issued a total of USD300m five-year
green bond in two tranches in January 2019,and recently in June 2020 issued a USD60m
tap issue from the January issuance. The
January 2019 issuance was supported by
the International Finance Corporation (IFC),
acting as an anchor investor (USD75m).
Proceeds are allocated to 5 GW of renewableenergy projects in East Asia and the Pacific.103
It was the first Certified Climate Bond listedon the Singapore Exchange, qualifying under
the Thermal, Solar, Wind, and Geothermal
Criteria of the Climate Bonds Standard.
Following this was a private placement of
USD110m with a ten-year term, of which
USD20m was invested by ADB. The issuance
was also Certified under the Climate Bonds
Standard. The energy producer issued a
USD400m perpetual green bond under the
ASEAN Green Bond Standards. Finally, in
2020, AC Energy also issued a USD60m
green bond, with the use-of-proceeds ofrenewable energy, in compliance with theASEAN Green Bond Standards.104“Our green bond issuance was in line withthe company’s goal of achieving 5,000
MW of renewables capacity by 2025.
Issuing the green bond was a smoothprocess. The green bond label and the
Climate Bonds Certification helped withmarketing our issuance. Our roadshows inHong Kong, China; and Singapore gained
traction not just from investors within Asia
but green investors from Europe as well.
The green bond issuance also strengthened
the AC Energy organization’s commitment
towards sustainability.”
AC Energy

13Philippines green bond issuance
IssuerAmountIssue dateIssuer typeUse of proceeds

Manila Water Company Inc.

USD500m

Jul-20Non-Financial Corporate

Water

Ayala Corporation (AC Energy
Finance International Ltd.)USD60mJun-20Non-Financial Corporate

EnergyArthaland

PHP3bn(USD61.8m)

Feb-20Non-Financial Corporate

Buildings

Ayala Corporation (AC Energy
Finance International Ltd.)USD400m

Dec-19Non-Financial Corporate

EnergyBPICHF100m(USD108.6m)

Aug-19Financial Corporate

Energy, Buildings, Water, Waste

BPI

USD300m

Sep-19Financial Corporate

Energy, Buildings, Water, Waste

Ayala Corporation (AC Energy
Finance International Ltd.)USD110m

Feb-19Non-Financial Corporate

EnergyRCBC

PHP15bn(USD309m)

Feb-19Financial Corporate

Energy, Buildings, Transport, Waste

Ayala Corporation (AC Energy
Finance International Ltd.)USD75mJan-19Non-Financial Corporate

EnergyAyala Corporation (AC Energy
Finance International Ltd.)USD225m

Jan-19Non-Financial Corporate

EnergyChina Banking Corp

USD150m

Oct-18Financial Corporate

Energy, Buildings, Water, Waste

BDO Unibank

USD150m

Dec-17

Financial Corporate

Energy, Buildings, Water

Aboitiz Equity Ventures(AP Renewables)

PHP10.7bn(USD220.4m)

Feb-16

Non-Financial Corporate

EnergyNote: This list is based on the CBI Green Bond Database

CBI Database methodology
The Climate Bonds Initiative Database105
screens labelled green debt instrumentsby reference to the Climate Bonds
Taxonomy to identify debt instruments
such as bond, loans and ABS as eligible for
the CBI Green Bond Database. CBI goes
through a three-step process to include or
exclude a green bond in the database:First, CBI identifies the green debt
instruments. The issuer of a greenthemed bond, for example, must
declare that the bond is intended to
be environmentally beneficial throughlabelling the bond. The most commonlyused label is ‘green’, but other labels
are also considered such as Climateawareness, Solar, Sustainable, Energy
efficiency, and SDG.
Second, CBI screens the projects orassets for alignment with the Climate
Bonds Taxonomy. Each debt instrument isreviewed based on the green credentialsof the use of proceeds. The methodology
for inclusion in the database is alignedwith the Climate Bonds Taxonomy.106
The taxonomy is grounded in the latest

14

climate science that is consistent withthe 2°C warming limit set in the Paris
Agreement, and has been developed throughan extensive multi-stakeholder approach,leveraging the work of CBI’s Technical andIndustry Working Groups.
Third, CBI evaluates the allocation ofproceeds to aligned projects and assets.
Climate Bonds’ focus is on climate change
mitigation, adaptation and resilience. Only
bonds or similar debt instruments which are
expected to allocate 100% of net proceeds toaligned green assets, projects and activities
are included in the Climate Bonds Initiative
Green Bond Database. Note that if the
instrument is labelled ‘SDG’ or ‘Sustainable’
but meets the project/asset screen (i.e. 100%of proceeds are allocated to eligible projects),
then these are also included.
Notes:• Social bonds: At present, bonds withproceeds allocated to social projects(Social bonds and some Sustainability
bonds) are not included in the green bonddatabase as there is no social taxonomy

to assess them against. These arecollected in a separate database.
• Sustainability bonds: Refers tobonds where the proceeds will be
exclusively applied to finance or
re-finance a combination of bothGreen and Social Projects.
• Occasionally, there is lack of sufficient
information to determine the alignmentof use-of-proceeds which results in its
exclusion. Excluded deals may be included
retroactively if new information is available.
• Country classification: Bonds are given
a country classification based on the‘Country of risk’ of the issuing entity. Thismeans that not all bonds denominatedin a local currency are included in the
country tally. For example, the PHPdenominated IFC bond is categorized as‘Supranational’ and not included in thePhilippines figures.

Philippines GIIO Report Climate Bonds InitiativeOther labelled and COVID-19 bonds
Beyond green bonds, there is a wide rangeof different labelled bonds intended toachieve other goals, such as social andsustainability bonds. Under the ICMA
and ACMF, a sustainability bond isdefined as a bond where the proceeds
will be exclusively applied to finance or
re-finance a combination of both climate
mitigation and adaptation (green) andsocial projects that respectively offer
environmental and social benefits.107
Social bonds focus solely on social
projects that will generate positive social
impacts, such as proceeds toward SME
financing and microfinance, or providing
access to essential services such as
healthcare. A recent example of a social
bond in the Philippines is the Bank ofPhilippine Island’s (BPI) social bondwith proceeds to finance or refinanceeligible micro, small, and medium-sized

Potential green bond issuers
Based on the Climate Bonds’ research, there
are many potential green bond issuers in thePhilippines—with most renewable energy
providers as potential green bond issuers.
The Energy Development Corporation has
been identified as a potential issuer which
could boost the country’s green bondvolume since the last issuance in 2016.
They also have a track record of having
issued a bond in hard currency. They havealso borrowed the proceeds of IFC’s peso
green bond issued in 2018.112
Two state-owned Enterprises also havethe opportunity to give a new impetus togreen finance, having tapped both domestic
and international markets for vanilla bondsin the past. The first is Land Bank, which
was awarded a Green Leadership award
for its Environmental Due Diligence (EDD)
system in 2015. Its renewable energy
lending program covers a wide range oftechnologies and eligible borrowers. The
bank offers financing support to low carbon
building initiatives.
The second is the Development Bankof the Philippines. It has already issued
Sustainability Bonds and has a Green
Financing Program designed primarily toassist strategic sectors, industries and LGUs
in adapting environment-friendly processes
and technologies and incorporating climatechange adaptation, mitigation and disasterrisk reduction measures, by providing
financing and technical assistance. LGUs in
the Philippines are also potential issuers ofgreen municipal bonds.113

enterprises (MSMEs).108 Globally, themarkets have seen a surge in the issuanceof both social and sustainability bonds in
response to the pandemic.
Government and development banks
globally have been actively issuing bonds toprovide immediate relief in the midst of thedevastating impacts of COVID-19. In the firstseven months of 2020, sustainable bonds
issuance surpassed USD270bn, up by 5%from 2019.109 This includes the issuance of‘pandemic bonds’ largely driven by China(USD67bn issued up to July 2020), and as
previously mentioned BPI’s Social Bond.110
China’s pandemic bonds finance projects
that provide immediate relief and response
to COVID-19 such as medical waste
management for quarantine centres, rent
reductions, and an update and replacementof power generation equipment for epidemic
prevention and control.

Opportunities for local
government green bond issuance
Although there has not yet been any
issuance of local government green bondsin the Philippines, there may be potential
for the future. There is political will, andopportunities for credit enhancement
through Philguarantee.
The LGU Guarantee Corporation (LGUGC)
previously provided credit enhancement
opportunities for local government but wasdissolved in December 2019.114 The Electric
Cooperative-Partial Credit Guarantee
Program from the LGUGC was absorbed byPhilguarantee.115 Philguarantee is a result of
the merger and consolidation of five Philippine
guarantee programs and agencies, and it
could potentially provide credit enhancement
to LGUs.116 In the past, the LGUGC had
several successes providing guarantees forthe funding of LGU infrastructure projects,
including climate mitigation projects.

While initial pandemic-related spending
has focused on short-term emergency
response, as the global economy shifts
towards post-COVID-19 recovery, spending
priorities (and associated bond issuance)
will also shift towards economic stimulus.
The global narrative has been focusedon ensuring that any recovery is a green
recovery (green stimulus) of ‘buildingback better.’ Post-COVID-19 stimulus
plans and spending will be critical to set
economies on a pathway in line with theParis Agreement. As echoed by the IMF
and ADB, economic recovery stimulus canbe used as an accelerator to spur green
economic recovery in the greater Asia andPacific region.111 Alongside other thematicbonds such as the social and sustainability/
SDG bond, green bonds can be used as an
instrument to achieve a greener and moreclimate-resilient economic recovery.

LGUGC or municipal bond banks, as they
could play a significant role in growing thePhilippine green bond market.
Investors are increasingly confident that,as climate change accelerates, cities willprioritize projects that seek to mitigate theconsequences.117 Some investors consider
green investments as more resilient thanother types of long-term city projects
and may be willing to pay for longer-term
municipal bonds certified by the Climate
Bonds Initiative compared with similar debt
that does not carry that certification.118

The government could also consider themunicipal bond bank model as a tool toincrease green local government bonds.
Municipal bond banks have been a dominantsource of finance in the US and have also beendeveloped in Mexico. These are banks owned
and operated by state government agencies,
set up with the purpose of aggregating
municipal financing needs and lowering thecost of funding. They issue general purpose
bonds on the capital markets and redistributethe proceeds to municipalities.
Municipal bonds should be encouraged andfacilitated using mechanisms like the former

Philippines GIIO Report Climate Bonds Initiative15

Greening the stock exchange
The SEC Philippines has also been involvedin the development of the Sustainability
Reporting Guidelines for Publicly Listed
Companies (SEC MC. No. 4, s. 2019). Thisaims to help publicly listed companies assess
and manage non-financial performanceacross economic, environmental, andsocial aspects of their organisation andto enable them to measure and monitor
their contributions toward achieving
national policies and programs as well asuniversal sustainability targets, such as theSustainable Development Goals.119 This waspart of a wider program for greening thePhilippine Stock Exchange (PSE). In May
2019, the PSE affirmed its commitment tosustainability by joining the UN’s Sustainable
Stock Exchanges (SSE) Initiative.120
The SEC and the PSE continue to actively
promote sustainability in the Philippine
market: co-organising a sustainable business
conference in June 2019 and several
roundtables, trainings, and workshops
since then.121 Into the future, one of the new
initiatives being explored is the developmentof an Environmental, Social, and Governance(ESG) index on the exchange.122

Banking on sustainability
Beyond the achievements of the regulators,
leadership has been shown in the banking
sector. Recently, the Bangko Sentral ng
Pilipinas (BSP) is looking to ramp up
its sustainable finance framework byencouraging banks to issue more green,social, and sustainability bonds. This year, BSP
has invested in USD200m of green bonds.123
BSP has taken into account climate-related
weather risk in calculating the inflation
trends.124 BSP acknowledges that thesignificant impacts from climate change
pose a risk to the financial system, andaffect the credit and operational risk
exposure of the banks, which in turn affectprofitability and solvency if climate-related
risk remains unmitigated.125
BSP has issued their Guidelines on
Sustainable Finance Framework: requiring
the integration of sustainability principles
including those covering environmental andsocial risk areas in the corporate governanceand risk management frameworks.126
According to BSP, Philippine banks andfinancial institutions are now required toincorporate ESG and sustainability principles
into their corporate strategy, risk management
and bank operations framework.127

16“The reason for that additional allocation(of green bonds) was the growing
significance of sustainability assets in
the investment landscape. Green bonds
offer institutional investors a means ofaccessing sustainable investments in the
fixed income market, while providing
greater transparency on how the funds areused by the issuer.”
Governor Benjamin Diokno, Bangko
Sentral ng Pilipinas130

For us to choose the path of sustainability
is as much about being a good corporate
citizen as it is about strategic positioning.
We believe that financial institutions,particularly banks must play an importantrole to support the UN Sustainable
Development Goals and help meet theobjectives of the Paris Agreement. We
believe that caring for the environment,
superior financial management, andprofitability can and must co-exist. We
wanted to make our balance sheet resilientto the effects of transition to a low carbon
economy and physical risks brought uponby climate change. We also wanted to add
another layer of diversity to our existing(well diversified) liability base.”
Rizal Commercial Banking Corporation(RCBC).133

Private banks in the Philippines have led
on green finance by issuing of green andsustainability bonds to fund and refinancegreen assets.128 To date, the Philippine
banks that have issued green bonds are
the Bank of the Philippine Islands (BPI),
RCBC, BDO Unibank, and China Banking
Group. Many banks are also providing green
loans and other tools for developing green
infrastructure and renewable energy. For
instance, the Sustainable Energy Finance(SEF) program, pioneered by BPI, provides
access to capital and technical support for
renewable project owners. This program has
successfully deployed private renewableprojects in the Philippines.129 The SEF model
has been replicated by other banks suchas BDO Unibank. Other banks, such as
Development Bank of the Philippines (DBP)
has three initiatives for financing green
projects and a sustainable bond program.

“Our Sustainable Energy Finance (SEF)
Program, in place since 2010, has allowed
us to build our portfolio of green projects.
BDO is always looking for opportunities
to finance sustainable projects within the
country and across the ASEAN region.
To-date, BDO has financed 45 renewableprojects situated in various regions of thePhilippines, as well as the acquisition andconstruction of existing and new clean
energy projects in China. We believe thatgreen bonds are an effective alternative
source of long-term financing for climatesmart projects that can help mitigate
the impact of climate change while
addressing ESG concerns of investors andrelevant stakeholders.”
BDO Unibank132“As the country’s preeminent development
financing institution, DBP adheres tothe principles of sustainability and has
shown deep environmental and social
commitment in both our operations
and our lending activities. One ofthe developmental priority thrustsof the Bank is environmental protection.
And in pursuit of this, the Bank, in
1997, came out with its Environmental
Policy Statement which reiterates DBP’scommitment to environmental protection
and sustainable development and shallintegrate and implement environmental
consideration into all aspects of
its operations and services, asset
management and business decisions.
Furthermore, in 2019, the Bank
developed its Sustainability Financing
Framework which adheres to the ICMA
Green Bond Principles 2018, Social
Bond Principles 2018, Sustainability
Bond Guidelines, and the corresponding
ASEAN standards and guidelines issued
by the Philippine Securities and Exchange
Commission. Under this framework, theBank issued Sustainability Bonds inNovember 2019 where it was able to raise
PHP18.125 Billion to finance and refinanceeligible projects.”
Development Bank of the Philippines131

Philippines GIIO Report Climate Bonds Initiative

Green banking initiatives
Stakeholder

Initiative

Description

Development Bankof the Philippines

The Green Financing
Program (GFP)The GFP provides financing and technical assistance primarily for LGUs toassist its green strategic sector projects. The program assists in adapting
environmentally friendly processes and technologies and incorporating climatechange adaptation and mitigation in their projects.134
The program promotes investments for environmentally friendly processes andsystems such as cleaner production, waste minimization, resource conservation,energy efficiency, pollution prevention and control.135

Bank of thePhilippine Islands

Financing Utilities for
Sustainable Energy
Development (FUSED)FUSED aims to contribute in increasing access to electricity services throughfinancing in order to help achieve inclusive growth and poverty reduction.136

Program Assistance toSupport Alternative Driving
Approaches (PASADA)
Financing Program

PASADA aims to support the implementation of the national government’s
Public Utility Vehicle Modernization Program (PUVMP) including revitalizing
the PUVs to comply with emission standards and improve alternative transporttechnologies such as solar or electric power.137

Energy Efficiency Savings(E2SAVE) Financing
Program

The E2SAVE program is designed to boost productivity of public and private
institutions by improving their energy efficiency projects. E2SAVE provides
credit assistance based on the level of energy savings, such as Energy Saving
Companies to further promote the development of energy efficiency projects.138

Sustainable Energy Finance(SEF) Program

Capital Expenditure Financing: This option is for financing fixed asset acquisition
such as new plant or building construction, expansion or modernization ofoperations, acquisition of machinery and equipment.
Working Capital Financing: This is for the short-term financing needs ofmanufacturers or traders of EE and RE products, e.g. purchase of raw materials.
Leasing: To finance the use of an asset or equipment over a specified periodof time. Any type of asset can be leased as long as it is durable, identifiable,
insurable, and has a good secondary market and reliable after sales support.139

BDO Unibank

Sustainable Energy Finance
Program (SEFP)

In partnership with the IFC, BDO Unibank began developing its SEFP in 2010.
BDO Unibank provides finance and technical advisory services for renewableproject owners. BDO Unibank has increased its renewable energy loan portfolio
over time.

China Bank

Sustainability Financing andGreen Bond Program.

Chinabank, in partnership with IFC, worked together in 2012 on a sustainableenergy finance advisory project. In 2017, China Bank participated in themobilization of PHP796bn in loans, bonds, and securities for projects andinvestments that contribute to the U.N. Sustainable Development Goals.
In 2017, China Bank issued a green bond with a use-of-proceeds for climate-smart
projects, including renewable energy, green buildings, energy efficiency and water
conservation, in accordance with the Green Bond Principles.

Philippines GIIO Report Climate Bonds Initiative17

Green funds
The Philippines has developed several
funds for supporting green infrastructure
and renewable energy projects. They arealso eligible to access some regional andinternational green funds. A domestic
initiative, led by the Climate Change
Commission (CCC), is the People’s Survival
Fund (PSF), which was created as an annual
fund intended for local government units andaccredited local/community organizations
to implement climate change adaptation
projects that will better equip vulnerable
communities to deal with the impacts ofclimate change.140
The Philippine government programmed
at least PHP1bn into the fund, sourced
from the national budget, which may be
augmented by mobilizing funding sources
such as counterpart local government
units, the private sector, and individuals
who support adaptation initiatives. The PSF

is intended for activities including water
resources management, land management,
and agriculture and fisheries, among others,
and serves as guarantee for risk insurance
needs for farmers, agricultural workers andother stakeholders.
The Philippines also has Access to Sustainable
Energy Programme (ASEP), which is a joint
undertaking of the European Union and thePhilippine Department of Energy (DOE).
Through ASEP, the EU has allocated a grantof over PHP3bn to assist the Government of
the Philippines to meet its rural electrification
targets by means of renewable energy, and topromote energy efficiency.
At the regional level, the ASEAN
Infrastructure Fund Ltd. (AIF), establishedin 2012 and owned by the ASEAN member
states and ADB is dedicated to fundinfrastructure development needs bymobilizing regional savings, including
foreign exchange reserves. The AIF hascommitted an estimated USD500m for nineprojects, with a total portfolio size of around
USD3bn, including ADB co-financing.141
These projects are from Indonesia, Vietnam,
Myanmar, and the Lao People’s Democratic
Republic.142 In 2019, the AIF launched
the ASEAN Catalytic Green Finance
Facility (ACGF) to support governments
in Southeast Asia to prepare and financeinfrastructure projects that promote
environmental sustainability and contributeto climate change goals (see below).
There is also the Renewable Energy Asia
Fund (REAF I) and REAF II, which invest
in small hydro, wind, geothermal, solar,
and biomass projects in Asian developing
markets, with a primary focus to date inIndia, the Philippines, and Indonesia.143
REAF made equity investments in small
renewable energy projects such as ongrid solar, wind, waste-to-energy, andhydropower projects of between 5 MW and
100 MW in these three countries.144

The Green Climate Fund

Development Finance Institutions (DFIs) have a unique role to play

The CCC is the National DesignatedAuthority (NDA) in the Philippines for
the Green Climate Fund (GCF). The
GCF is an international fund createdby the United Nations Framework
Convention on Climate Change tosupport paradigm-shifting low emission(mitigation) and climate resilience(adaptation) projects and programs indeveloping countries.145 It has a multilayered approach to mobilize climate
finance in the form of investments
including grants, loans (concessional),
equity, and guarantees. The GCF
promotes country ownership and theywork closely with the NDA.

DFIs have a mandate to support
developing countries and can achieve
this through blended finance and credit
enhancement mechanisms, reducing
risk exposure and enhancing market
incentives for investors to mobilize
private capital. This is particularly
relevant for large-scale projects suchas infrastructure development, where
the blended finance approach cangenerate more bankable project pipelines
by providing technical support andfacilitating access to funding.147

There is currently one GCF project in
the Philippines, relating to disaster
preparedness.146 In the future,
Philippine entities could seek fundingfor qualified projects and programmes,
including those that improve theefficiency of buildings and appliances,
the adoption of cleaner sources ofenergy such as solar and wind, theintroduction of more efficient andsustainable transportation, or the
improved use of land and reforestation.

18

DFIs can act as market facilitators, which
is beneficial to increasing liquidity andissuance in local economies. For example,
the IFC issued a green bond in June 2018in Philippine peso (a Mabuhay bond)and one in Indonesian rupiah (a Komodobond) in October 2018. Through deals likethese, DFIs can support “market creation”
by participating in first-time issuances andhelping new issuers get their names out
to investors. Effectively, this establishes
pricing points, the idea being that issuers
return to market publicly. So, the deals
also act as demonstration issuance tospur market growth and can showcase
how climate solutions can be funded withgreen bonds.148

DFIs in ASEAN, such as the International
Finance Corporation (IFC), ADB, AsianInfrastructure Investment Bank (AIIB)
and the World Bank, can also subscribe to
private placements or be anchor investors indebt issuance and IPOs to help the company
seeking funding to build investor confidence
and catalyse investments from a wider poolof private actors.149 So, they provide direct
green financing; as anchor investors in debt
issuance or in IPOs, DFIs can leverage theirsupport to attract other investors.
They can help a company seeking
funding to build investor confidence andcatalyse investments from a wider poolof private actors (both international anddomestic). For example, as previously
mentioned, in early 2019, ADB and otherdevelopment financiers launched the“ASEAN Catalytic Green Finance Facility”
under the AIF, an initiative to mobilize
over USD1bn for green infrastructure
in Southeast Asia.150 The facility will
provide loans and technical assistance forsovereign green infrastructure projects
such as sustainable transport, clean
energy, and resilient water systems,
which aims to catalyse private capitalby mitigating risks through innovative
finance structures.151

Philippines GIIO Report Climate Bonds Initiative

ASEAN Catalytic Green Finance Facility
Launched in April 2019, under the ASEAN
Infrastructure Fund (AIF), the ACGF
signifies ASEAN member countries’commitment to promote sustainableinfrastructure development and address
climate change in the region.
The ACGF offers governments benefitsof both loans and technical assistanceto support government in identifying
and preparing commercially viable green
infrastructure projects. ACGF loans
provided from the AIF’s equity can beutilized to cover upfront capital investment
costs, while a regional technicalassistance, supported by ADB technicalassistance resources and grants fromdevelopment partners, supports project
structuring and origination activities. This
two-pronged approach “de-risks” green
infrastructure projects, making them more
attractive to private capital investors.152
As of June 2020, the AIF Board had
included three green infrastructure
projects in its pipeline for funding underthe ACGF, including one in the Philippines,
and funding for other projects in thePhilippines is currently being explored.

ACGF could further support post-COVID
19 green stimulus by channeling technicalassistance support for developing derisking mechanisms, on a country-bycountry basis.153 For instance• De-risking mechanisms, such as
insurance against specific risks, firstloss provisions, purchasing equity or
mezzanine tranches of securitised bonds.
• Support for the issuance of tailored
structures, such as zero-coupon
bonds designed to avoid interest during
the economic re-building of the coming
five years, or step-up coupons with asimilar objective.
• Support for the development of assetbacked structures that would allow
off-balance sheet re-financing
of sustainable assets and easepressure on constrained public
sector balance sheets.
These mechanisms could also be
available to qualifying bond issuanceprogrammes from banks, municipalities,
and private companies.

Philippines GIIO Report Climate Bonds Initiative“Within the ACGF we are following aphased approach to supporting de-risking
in green projects. The initial phase of
support, which is being undertaken now,is using the classic approach, of providing
concessional finance for reducing theblended cost of capital for a project for an
initial 7 years which covers construction
and initial operations. At the end of thisperiod, the ACGF funding cost steps up,
with the intention of focusing projects
to consider refinancing ACGF out using
commercial finance – we thus achieve theaim of leveraging at the start of a project,
as well as catalyzing private investments
once the risks are considerably reduced.
ADB, as Administrator of the AIF is also
exploring providing other innovative derisking measures in future phases of the
ACGF. An example of this is support for
operations in the first 3-5 years througha minimum revenue guarantee support.
Whilst still using a debt instrument for this,
this provides further necessary de-risking
to projects especially needed if sufferingfrom the impacts of the COVID-19
pandemic. We are also exploring adding
a first loss product to provide guarantees
to projects which are trying to raisecommercial finance or even through bonds.
The roll out of these products will of course
depend on projects, governments, and ourown AIF Board considerations.”
Anouj Mehta, Unit Head, Innovative& Green Finance Hub and The ASEAN
Catalytic Green Finance Facility, ADB

19© Climate Bonds initiative

Brown to green transition in the Philippines

A brown-to-green (BtG) transition strategy reflects the fact that,in the short to medium term, large companies in many sectors will
inevitably straddle both brown and green assets, progressively
reducing exposure to brown assets and practices as they increasecapex toward, and adoption of, greener modes of operation. It
also embodies a recognition that, both globally and locally, theexpectation of institutional investors is that progress toward
low or zero-carbon business models is increasingly indicative ofcorporate performance, hedging of climate risks, and long-termvalue accretion.154
Global green investment opportunities are growing and yet there
remains a scarcity of offerings, pointing to a lack of supply of green
bond issuance particularly from non-financial corporates, i.e. thereal economy. Furthermore, segments of the real economy thatoffer significant emissions reductions potential–such as cement
and concrete, mining and metals, oil and gas, transport andmanufacturing–are yet to be activated toward a BtG transition.
When such industry sectors start to align with a 2-degree
emissions trajectory, new green financing opportunities could becreated for assets and projects with ambitious climate targets andan increased focus on low carbon production modes.155
A national BtG strategy should require GHG emissions-intensive
industries (‘brown’) and organisations to commit to strategic

20change, undertaking tangible and verifiably climate-relevantmeasures that relate to companies’ core business activities. They
will need to progress from broad statements of strategy or intent
to disclosure of climate risk as envisioned by compliance with the
Task Force on Climate-related Financial Disclosures (TCFD) and,ultimately, to a visible reflection of green investment on balance
sheets, in capex plans and borrowing programs.156
Credible green bonds are a highly visible means to support thistransition from brown into green. Even a small initial share of green
capital expenditure could be a credible indicator of more to come,
if it is combined with a re-orientation and acknowledgment toinvestors that achieving low carbon targets and then zero carbon
operating models are inevitable business destinations between
now and 2050.157
Transitioning to a green, climate-resilient economy is paramount toensure that the region can reduce its GHG emissions, better hedge
against climate change risks, and thrive in the long run.158 The
Philippines ambitious NDC is compatible with the 2-degree global
emissions trajectory and could thus form the basis of a nationwide
brown-to-green strategy. Any such strategy needs to be morethan just targets–it should be accompanied by actual expenditure,policy tools, and capital raising plans to support the prioritisationand development of green projects across the economy.159

Philippines GIIO Report Climate Bonds Initiative

Green infrastructure investment opportunities
The Philippine government aims to develop billions of dollars of
new public works projects. Most major infrastructure projects in thePhilippines are listed on central government websites and other publicly
available sources or are listed by individual project proponents.
There are already green infrastructure
projects and assets of many different sizes
and technologies spread across the nation.
These range from the USD1.4bn metropolitan
rail project through to a USD20m
waste management project. A list of 79
infastructure projects has been compiled intoa sample pipeline (see Annex VI).
This report uses the globally recognised
Climate Bonds Taxonomy and Sector Criteria
to determine which projects and assets
are green. However, there are many otherstandards and schemes that can be used
to measure the ‘greenness’ of projects in
the Philippines, including global standards
and those from Southeast Asia and thePhilippines.160 Most of these apply to either
the development and retrofitting of buildings
or a broad set of infrastructure projects andassets (see Annex V for more details).
Investors currently have too few tools toensure that their investments are making
a significant impact. Having common
definitions of ‘green’ across global markets
allows investors, potential issuers and policy
makers to identify green assets and attract
investment more easily.161
Ideally, the Philippines government could
adopt a green standard to identify green
projects during infrastructure planningand collating these in a single list. Thenit can prioritise projects that are in linewith international definitions for ‘green’
and provide clear ‘green’ labelling, when
preparing future infrastructure pipelines.162

Methodology164
The following section explores green
infrastructure investment opportunities
across the Philippines in four key sectors:
renewable energy, low carbon transport,sustainable water management andsustainable waste management. Although
not included here, the Philippines has somegreen projects across other sectors like green
buildings, agriculture/forestry, and tourism.
There are various ways for an investor togain exposure to a specific project, asset or
portfolio. The possible investment pathways
will vary depending on the asset ownership
structure, the stage in the asset’s financing
lifecycle, and the investor’s mandate. Thiscan vary between projects with public andprivate funding.
Accordingly, metrics were used to classify
the green infrastructure investment
opportunities, by status:• Completed projects: high profile, recently
completed projects;• Projects under construction: major
projects that are under construction; andCase studies and a sample pipeline have beendeveloped for this report to show the different
types of opportunities available in the shortand medium-term future in the Philippines.
The case studies include both greenfield andbrownfield projects and assets that could
have been or could potentially be financed/
refinanced via green bonds.

Climate Bonds Taxonomy andthe Climate Bonds Standard andCertification Scheme165
The Climate Bonds Taxonomy features
eight climate-aligned sectors (see backcover). The purpose of the Taxonomy
is to encourage common broad ‘green’
definitions across global markets in a waythat supports the growth of a cohesive
green bond market. The Climate Bonds
Standard & Certification Scheme is used toprovide a labelling scheme for bonds andother debt instruments.
The Sector Criteria for the Climate Bonds
Standard & Certification Scheme provide
eligibility conditions or thresholds whichmust be met for assets to be in line with arapid trajectory toward a 2050 zero-carbon
future. The criteria are developed based on
climate science by technical expert groups
with input from industry.

• Planned projects: major projects thathave not yet begun construction but havebeen announced and/or have undergone
business case planning and/or have been
allocated budget.

Providing this level of visibility for green
infrastructure investment opportunities
could facilitate increased access to private
sector capital for the Philippines’ economic
development and accelerate the Philippines’
transition to a low carbon economy in orderto help meet global institutional investor
demand for green assets.163

Philippines GIIO Report Climate Bonds Initiative

21

What’s green?

+ –

+ –

+ –

Geothermal:

Solar:

Hydropower:

According to the
Geothermal Energy
Association, 39 countries
could supply 100% of their electricity
needs from geothermal energy, yet
only 6% to 7% of the world’s potential
geothermal power has been tapped.166

The world installed a record
number of new solar power
projects in 2017, more than
net additions of coal, gas and nuclear
plants put together.168

Hydropower is the largest
source of renewableelectricity in the world,
producing around 17% of the world’s
electricity from over 1 200 GW of installedcapacity, and is expected to remain
the world’s largest source of renewableelectricity generation by 2022.167

Drawdown Agenda

UNFCCCInternational Energy Agency

22

Philippines GIIO Report Climate Bonds Initiative© Climate Bonds initiative

Transport (rail):

Water:

Buildings:

75% of the world’s countries
have established strategies
and targets to improve theenvironmental performance of their transport
sector within their Intended Nationally
Determined Contributions (INDCs).
One-fifth of the transport-related (I)NDCs
include measures in the railway sector.169

The UN says the planet
is facing a 40% shortfall
in water supply by 2030,
unless the world dramatically improves the
management of this precious resource.170

Building-related emissions
account for about one-thirdof global GHG emissions andcould double by 2050, making building
efficiency a critical part of the COP21
agenda.171

UNFCCC

GreenBiz

UNFCCC

Philippines GIIO Report Climate Bonds Initiative

23

Renewable energy

Sector overview
The Philippine Energy Plan of 2017-2040,
introduced in 2017, prioritizes energy
security while keeping pace with its risingenergy demand.172 In the 2015-2020 period,
the country’s electricity consumption growthrate (5.7%) had outstripped the 5.3% energy
generation growth rate.173 The Philippines
is heavily reliant on imported coal to meetits current energy demand, specificallyits transportation and power generationneeds.174 In 2018 alone, coal remained thesole type of energy source with the largest
share in Philippines’ energy mix; 52.05% of
the country’s power generation is sourced
from coal,175 and 75% of this is imported.176
The government has recognized that thisis not sustainable and has indicated theneed for renewable energy to play a criticalrole in achieving their energy targets. It has
made significant progress in developing
its indigenous renewable sources. This
progress was spurred by the Feed-in-Tariff(FIT), introduced in 2012, that jumpstarted renewable energy deployment. The
implementation of the FIT scheme in thePhilippines is considered best practice.177
The FIT was an objective of the Philippines’
Renewable Energy Act of 2008, which
was the first comprehensive legislation on
renewable energy in the ASEAN region.178
Following this act, the National Renewable
Energy Board (NREB) was immediately
created, then followed by the National
Renewable Energy Program (NREP) in 2011.
The NREP outlined and established fiscal
and non-fiscal incentives for private sector
investors, renewable energy equipment
manufacturers, suppliers, and project
developers.179 Examples include incentives
such as an income tax holiday, and aguarantee for the renewable energy market,
through the renewable energy portfolio
standard (RPS).180 The private sector
became the main driver of the deploymentof Philippine renewable energy, in responseto the government’s favourable business
policy.181 The government also implemented
the Energy Efficiency and Convervation Act
that aims to institutionalize energy efficiency

24

Phillippines Energy Mix (2018)
Oil-based 3%

Natural
gas
21%

Coal
52%

Renewableenergy24%

and conservation and enhance the efficientuse of energy, and provide incentive forenergy efficient projects.182
Despite its remarkable progress withrenewable energy deployment in the past,
recent data suggests that the uptake ofcoal energy outpaced the deployment of
renewable energy in 2018.183 This is mainly
due to the increasing utilization of theexisting coal power generation facilities.184
Without aggressive policy intervention
power generated from coal will only peak by
2034 and the Philippines will likely miss its
35% renewable target.185,186
Renewable energy only accounted for 21%of the Philippines’ total energy output
in 2019.187 With promising capacity for
geothermal, hydropower, and ocean energy,
and fairly good resources for solar and windenergy,188 the country still has significant
renewable energy development potential.
Geothermal
The Philippines is the world’s
second largest producer ofgeothermal energy and has anuntapped geothermal potentialof 2,500 MW.189 In 2018, geothermal
had a total energy output of 10,435 GWh
and an installed capacity of 1,944 MW.190
Geothermal power is forecasted to increaseby more than 600 MW in 2020. In thePhilippine Energy Plan (2012-2030), theDepartment of Energy identified 26 sites toincrease existing installed capacity by 62%
throughout the 18-year planning period.191

Hydropower
Hydropower currently accounts
for 4% of primary energy
supply in the Philippines andhas an untapped potential of
13,097 MW.192 Approximately 85% of thispotential is suitable for large and smallhydropower, and the rest consist of mini andmicro-hydropower.193 The government has
identified 18 potential sites in 2017, which
accounted for 86% of the total potential.194
The energy output in 2018 for hydropower
was 9,384 GWh, with an installed capacityof 3,701 MW.195
Biomass
Almost half of the landmassof the Philippine archipelago
is devoted to agriculture, andthis industry produces a hugevolume of agricultural waste. The largest
volume of agricultural waste comes fromrice straw, husks, and tropical fruit, which
accounts for approximately 16 million tonsof agricultural waste per annum.196 Twomillion tons of rice husk per annum could
be equivalent to five million barrels of oil,in terms of energy generation.197 In 2018,
the total biomass energy output in thePhilippines was 1,105 GWh, and the total
installed capacity was 258 MW.198
Solar
In 2018, solar energy was
generating 1,249 GWh in thePhilippines, with an installedcapacity of 896 MW.

Philippines GIIO Report Climate Bonds Initiative

Source: Philippine’s Department of Energy Statistics, 2018221

Energy generation, transmission
or storage technology that has
low or zero carbon emissions.
This can include solar energy,
wind energy, bioenergy,hydropower, geothermal energy,
marine energy or any otherrenewable energy source.

Both the northern and southern parts of
the Philippines are suitable regions forsolar power generation, as they are equally
exposed to solar irradiance. Of the different
the forms of solar energy generation,
solar rooftop is the most popular in thePhilippines. There is also a great opportunity
to further develop floating solar projects
located on hydro dams owned by the
National Irrigation Administration. Such a
project combines solar and hydropower tomanage low water power. The Departmentof Energy estimated that by 2030 at least
one-third of the total installed solar will berooftop solar. 199
In 2018, the Philippines’ Board of Investment
approved eight solar projects worth
USD1.65bn through the Solar Philippines
Commercial Rooftop Projects Inc. The
enormous scale of investment is predicted tolower electricity cost and trigger a USD2.8bn
new investment in 2030.200 The steadily
declining cost of solar PV by 18% annually
has also made large-scale solar energy
generation a more attractive investment forindustrial and commercial companies.201
Wind
In 2018, the Philippines
generated 1,153 GWh ofpower from wind energy andhad an installed capacity of
427 MW. The Feed-in-Tariff(FIT) policy has been attributed as driving
installed capacity from 33 MW in 2012 to426.9 MW by June 2018. Offshore wind
has also successfully taken off following
the FIT policy. In 2019, there were morethan 50 wind projects registered with the
Department of Energy.202
The wind resources in the Philippines are
greatest in the northern and central areas
such as the islands of Batanes and Babuyan,
and the northern and central Luzon areas.203
According to an International Energy Agency
analysis, in 2017, the country had a total
wind energy potential of 76,700 MW.204 In
2020, the Philippines is taking the first steps
into the offshore wind power sector withplans to develop 1.2 GW.205
Achieving greater energy diversification andfaster deployment of indigenous renewableenergy would bring the Philippines closer
to achieving its energy security by reducing
the country’s dependency on imported
coal, as well as cutting GHG emissions.206
The private sector is already sending
signals to shift away from coal investment.
Corporations such as AC Energy and Manila
Electric Company (known as Meralco) areeither already divesting or moving toward
cancellation of new coal plants.207

Funding pathways
The vast majority of renewable energy
projects in the Philippines are funded bycorporate rather than project finance.208
Local commercial banks have increasingly
recognized the potential of lending to
renewable energy projects. For mostrenewable energy projects, heavy costs
are incurred in the project preparation
phase, where there are still a few sourcesof local financing. However, local banks
such as the Land Bank of Philippines andthe Development Bank of the Philippines
have offered special packages that could
help developers fund renewables in the
preparatory phase.209
Tapping into the debt capital market isanother option for funding renewable energy.
Green bonds are very well suited to large
renewable energy projects or asset portfolios
and can be structured in a number of ways,
including project bonds, corporate bonds,
covered bonds or ABS. The Philippines has
plenty of examples in which project owners
have issued green bonds to fund renewableenergy projects.
The 2016 AP Renewables green bondissuance was intended to fund the TiwiMakBan geothermal project. 210,211 Thistransaction was also aided by ADB, whoprovided credit enhancement in the form ofa guarantee of 75% principal and intereston the bond.212 This was also Climate
Bonds Initiative’s first certified bond in thePhilippines.213 More green bond issuancefor renewable energy has since followed.
Most of these bonds have been backed bydevelopment banks such as the World Bank,
through the IFC, and ADB.

Then in 2018, Chinabank also issued a
USD150m green bond with the use-ofproceeds for climate-smart projects, including
renewable energy, green buildings, energy
efficiency, and water conservation, in
accordance with the Green Bond Principles.220
Renewable energy project developers andasset owners could have access to a wide
variety of funding options, including banks,
project financiers, debt clubs, investment
funds, direct investors, and the capital
markets. Renewable energy funds arebeing used to support greenfield projects
and stimulate innovation. The aggregationof smaller projects can be done throughsecuritisation or by banks originating
green loans and refinancing in the green
bond market. In some countries, local
governments are able to aggregate theirdebt requirements to access green financing
at a lower cost of capital than they would
have otherwise been able to access – in thePhilippines, this would be a useful mode for
LGUs to follow, particularly for financing
their smaller projects like waste-to-energy
projects. We note, however, that there
are numerous challenges to making suchcollaboration work in practice, particularly inthe short term.

In 2017, BDO Unibank issued a USD150m
green bond with the IFC being the soleinvestor.214 The green bond proceeds wereused to finance seven renewable energy
projects with a total generating capacityof 95 MW.215 Then, in 2019, AC Energy, a
subsidiary of Ayala Energy, raised USD225m
for its green bond216 listed on the Singapore
Stock Exchange.217
AC Energy’s green bond was the first
Climate Bonds Certified bond to be issued
publicly and in USD. ADB was the anchor
investor of this bond, investing USD20m
in the green bond to crowd-in otherinstitutional investors.218 AC Energy is arepeat green bond issuer in the Philippines,
it has issued green bonds six times to date.
In December 2019, AC Energy issued apereptual green bond that will be used tofinance the company’s plans to install up to
5GW of renewable energy across multiple
projects in Asia Pacific to 2025, including in
the Philippines.219

Philippines GIIO Report Climate Bonds Initiative

25

Geothermal plant funded by a green bond: Tiwi-MakBan geothermal complex expansion228
Proponent: AP Renewables Corporation
Location: Province of Albay
Status: Under construction. Most of the plant is complete andoperational; however, there is an expansion under construction.

Description: The Tiwi-MakBan Geothermal Complex is one of thebiggest geothermal facilities in the country and the region. Currently,
the complex has a total capacity of 458 MW at the MakBan
geothermal site in the provinces of Batangas and Laguna, and
289 MW at the Tiwi geothermal site in Albay, in the Bicol Region.
The expansion seeks to drill 12 new production wells over a
six-year period to increase steam availability for the power plantfacilities by about 20%.222
Output: The geothermal plants reduce the Philippines’
dependency from fossil fuel energy, such as oil, and improve thePhilippines energy security.

Source:225

Classification: Generation facility, geothermal, energy

Over the period of 1979-2003, it is estimated that power
generated from existing geothermal plants displaced 152.6 million
barrels of oil, saving the country an estimated USD3.21bn interms of foreign exchange.223
Cost: PHP10.7bn (USD220.4m)
Financial structure: Green bond (USD225m green bond, in 2018,
supported by ADB)224

Wind farm in the archipelagic province of Aklan: Nabas 2 wind project229
Proponent: PetroWind Energy, subsidiary or Petro Energy
Resources Corporation (PERC)
Location: Nabas, Aklan Province
Source:227

Status: Planned
Classification: Generation facility, wind, energy
Description: The project would expand the 36-MW wind facility by
14 MW. The expansion of the 14-MW Nabas 2 will involve seventurbines. Nabas 2 is targeted to be ready for connection to the gridby early 2021.
PERC owned several other renewable energy assets, including the
32 MW Maibarara geothermal plant in Sto. Tomas, Batangas by
Maibarara Geothermal, Inc. (MGI), the 36 MW Nabas-1 wind farmoperated by PetroWind Energy Inc. (PWEI), and the 70 MW Tarlac
solar project in Tarlac City under PetroSolar Corporation (PSC).

Output: An increased capacity for a reliable renewable energy
power supply. The wind farm will supply energy to the NegrosPanay-Cebu grid project by the National Grid Corporation of thePhilippines. The grid is currently under construction, set to becompleted in 2021.226
Cost: PHP1.4bn (USD28.8m)
Financial structure: Corporate financeMilling Company constructs Biomass Power Plant: Victorias Milling Company Biomass Power Plant
Proponent: The Victorias Milling Company (VMC)
Location: Victorias City, Negros Occidental Province
Status: Completed
Classification: Generation facilities, bioenergy, energy

Output: The plant will export 25 MW of the energy produced
from the biomass plant into the grid and use the rest for its
own operations.

26

Source:231

Description: The 40 MW facility uses bagasse, the by-productof sugarcane, to produce biomass. The plant is also the largest
stand-alone biomass plant in the Philippines registered with the
Department of Energy (DOE).230
Cost: PHP2bn (USD41.2m)
Financial structure: Corporate financePhilippines GIIO Report Climate Bonds InitiativeSolar farm in Zambales: GIGASOL3 Solar Power Project234
Proponent: GIGASOL3, Inc.
Location: Palauig, Zambales
Status: Under construction (to be completed on Q1 2021)

Description: GIGASOL3 Solar Power Plant is a greenfield project
developed by AC Energy located in the Municipality of Palauig,
Province of Zambales. Covering a 58-hectare Comprehensive
Agrarian Reform Program (CARP)-exempted land in an industrial
zone, the project will be connected to the Luzon Grid through theexisting 69kV Botolan-Candelaria Transmission Line maintained by
the National Grid Corporation of the Philippines.
Output: With 63MW DC Capacity, the project intends to export
50MW AC of its generated capacity to the Luzon Grid. Potentially,

Source:232

Classification: Generation Facility, Solar Energy

the project can power more than 30,000 houses and can reduce
annual carbon emission by approximately 56,000 MT CO2.
Cost: PHP2.5bn (USD51.5m)
Financial structure: All-Equity Financing

Negros Biopower Plant: BioPower 70MW Biomass Portfolio in Negros, Philippines
Proponent: Bronzeoak Philippines
Location: Province of Negros Occidental, Philippines
Status: Completed - Testing & Commissioning Phase

Description: BioPower’s presence in the island province of Negros
Occidental is composed of three biomass power plants namely, San
Carlos BioPower, North Negros BioPower, and South Negros BioPower.
These renewable energy developments will collectively generate
70-MW of baseload capacity, fuelled primarily by sugarcane
trash sourced within the same region. These BioPower plants are
the first in the world to purely run on sugarcane trash, a residual
biomass remaining on fields after sugarcane has been harvested.
To secure feedstock supply to the three plants, the proponents
established a comprehensive fuel harvesting and logistics supply chain
capability. BioPower owns and operates multiple transloading stations
located in strategic parts of the Negros region to collect and utilize
more than 610,000 metric tonnes of feedstock as fuel every year.
Output: BioPower intends to provide electricity to an area of short
supply and increasing demand for baseload power. Generated powerfrom the plants is expected to reach around 610,000 people.
The biomass projects in Negros have provided substantial
countryside development in host communities, adding income
to local farmers and sourcing pesonnel requirements within thePhilippines GIIO Report Climate Bonds Initiative

Source:233

Classification: Generation facility, biomass, energy

region. The plants will operate virtually round the clock, 365 days
per year with several shifts per day to meet the labor-intensive
demands of biomass power generation.
As the three plants consistently make use of indigenous
biomass resources, it also adds value to sugarcane trash while
maintaining the environmental integrity of the sugarcane farming
industry. Utilization of sugarcane trash by BioPower plants willoffset 57,600 tonnes of carbon dioxide (CO₂) a year while also
mitigating the practice of open field burning, without additional
investment from planters.
Cost: PHP15bn (USD309m)
Financial structure: Loan from ThomasLloyd, a clean technology
infrastructure fund27

Low carbon transport
Transportation modes and ancillary
infrastructure that produce low orzero direct carbon emissions. Thiscan include national and urban
passenger rail and freight rail
networks, Bus Rapid Transit (BRT)systems, electric vehicles, andbicycle transport systems.
Sector overview
The Philippine Development Plan (2017-2022)
identifies the improvement of connectivity
and mobility through transportation as oneof the key drivers for economic developmentin the Philippines.235 The plan also outlinesthat a significant expansion of masstransport infrastructure is needed in order todecarbonize transport emissions and combat
the extreme traffic congestion experienced in
the Manila greater metropolitan area.236
The transportation sector is central to
the Philippines’ emissions reduction
strategy, because without transition into
mass transport and a cleaner source oftransport energy, the sector is expectedto account for up to 90% of total energy
demand in 2030.237 The government had
introduced numerous green policies to makethe transport sector more efficient andenvironmentally sustainable. For example,
the government mandated gasoline be
blended with 10% ethanol and 5% biodiesel
through the Biofuels Act in 2007.238 The
government is also modernizing PUVs andmassively expanding the MRTs and LRTs.
Public utility vehicles (PUV), locally known
as the Jeepneys (a local mini-bus public
transportation), is the most popular modeof public transportation in the Philippines.
Jeepneys are abundantly spread across thePhilippines’ municipal areas and the cheapest
form of public transportation.239 However,Jeepneys have been relying heavily on fossil
fuels, mainly diesel, which worsen the air
pollution in the Philippines’ metro area.240
To curb air pollution from the transport sector
the government introduced the Public Utility
Vehicle Modernization Program (PUVMP) in
June 2017. The PUVMP is a comprehensive
plan that aims to overhaul the Philippines’
public transportation industry to be more
efficient and environmentally sustainable
by 2020.241 One of the key objectivesof the PUVMP is to replace outdated
diesel-run Jeepneys with electric Jeepneys(e-Jeepney).242 The implementation of thee-Jeepney program will also improve safety
standards, as many of the Jeepneys of today
are made from scavenged parts, without
doors or bar handles for passengers.243
28

To enable this transformation, thePhilippines’ Department of Transportation
has signed 17 Memoranda of Agreement(MoA) with e-Jeepneys manufacturing
companies in 2018. From the MoA, thesemanufacturing companies agreed to supply
approximately 20,000 units of e-Jeepneys
annually and help Jeepney operators to meettheir financial requirements to transition to
the e-Jeepneys.244
The Land Transportation and Franchising
Regulatory Board (LTFRB) of the Philippines
had given Jeepney operators until July 2020
to phase out their old Jeepneys.245 The firstbatch of e-Jeepneys was rolled out in June
2018. By 2019, approximately 2,595 units
were modernized out of the estimated180,000 units of Jeepney nationally.246,247
Drivers and operators have to pay higher
cost to replace their Jeepneys, even withexisting government subsidy in place, whichis causing some resistance.248
Beyond the PUV, the Government of thePhilippines has made substantial progressin scaling up the construction of railway
transport infrastructure. Some major
projects include the rehabilitation of theNorth-South Commuter Railway (NSCR),
rehabilitation of the Metro Rail Transit Line
3 (MRT-3), and the extension of the Light
Rail Transit Line 1 (LRT-1) in Cavite, andthe Subic-Clark Railway.249 The Philippines
is expected to expand its the total railway
length to 1,144 km in 2022, a significant
expansion from only 77 km in 2016.250 The
cost of the most prominent four railway
projects currently under construction range
between USD2.03bn to USD6.85bn.251
The construction of new railway projects in
the Philippines has boosted growth in theconstruction sector, with the USD7bn fully
underground 25 km Metro Manila Subway(Phase I) being the key driver.252 Early
predictions from Fitch Ratings suggested
that the railway sector would grow by
8.6% in 2020.253
We note that marine transportation such as
ferries are not included in our methodology
for this report. These fall under the Shipping
criteria within the Climate Bonds Standard
and Certification scheme which werelaunched in Novemner 2020.254

Funding Pathways
Transportation infrastructure is traditionally
funded by government budget, but under
President Duterte’s Build, Build, Build
campaign, the Philippines has successfully
pushed numerous bilateral and multilateral

partnerships to fund infrastructure projects.
Currently, the largest railway infrastructure
funding is provided by the Japan International
Cooperation Agency (JICA) and ADB.255
The private sector is also providing funding
to narrow the government’s infrastructure
funding gap.256 These private investors
consist of a combination of local banks,development banks, and domestic investors.
Domestic banks in Philippines are also highly
liquid; BDO, BPI, MetroBank, and the Land
Bank of the Philippines are all dominant
players in infrastructure financing.257
Public-Private Partnerships (PPPs) willremain a critical tool for transportation
project development. The World Bank
considered the Philippines’ PPP framework
and PPP management to be strong.258 There
have been relatively few bond offerings fortransport PPPs as trading platforms have
limited guidance and policy for PPP projectbonds. Although, in 2017, the Philippine
Dealing System Group (PDS) announced
that it will consider rules to allow more PPP
fixed-income trading on its platform. In 2016,
Philippine Stock Exchange (PSE) eliminatedthe requirement to show three years of cash
flow as proof of creditworthiness, which
eased one of the restrictions for companies
to raise equity.259
There are also potential funding structures
available to encourage private sector
involvement in the long-term financing
required for low-carbon transport projects
including green bonds, outright asset
acquisitions, and the securitization ofgreen assets. Green bonds provide indirect
exposure for investors to specific projects
and assets and provide attractive credit
and liquidity credentials for institutional
investors. In 2019, the RCBC issued a
PHP15bn green bond with use of proceeds
allocated for low carbon transportation(along with energy, buildings, and waste).
Government-backed concessional loans
are a new structure that exists in ASEAN,
which provide greater leverage against therevenue streams of transport (i.e. fares).
Another innovative mechanism is ‘value
capture,’ which refers to the value that is
generated for private landowners from
infrastructure and surrounding business
operations. As private sector appetite
increases, funding sources will continue todiversify, and investment will accelerate.260

Philippines GIIO Report Climate Bonds InitiativeMajor Metro upgrade in Manila: MRT-11 Project267
Proponent: Department of Transportation
Location: National Capital Region (NCR)
Status: Planned
Classification: Railway, low-carbon transportation

Source:265

Description: The project involves the construction of an
approximately 18 km Metro Railway Transit System (MRTS) of
elevated structure starting from Epifanio Delos Santos Avenue(EDSA), Balintawak in Quezon City traversing along Quirino
Highway, Novaliches and Zabarte Road in North Caloocan City up
to Barangay Gaya-gaya in San Jose del Monte, Bulacan.
A passenger transfer facility shall also be provided proximate to the
EDSA-Balintawak station of LRT Line 1 and the MRT 11 Balintawak station.

Cost: PHP71.1bn (USD1.45bn)

Output: Reduced traffic congestion from usage of private vehicles,
reduced air pollution, and overall increased efficiency of travelling.261

Financial structure: Potentially funded by Official Development
Assistance (ODA) and Public-Private Partnerships (PPPs)262

Connecting East and West: East-West Rail Project268
Proponent: Philippine National Railways (government proponent)
Location: Quezon City
Status: Planned
Classification: Railway, low-carbon transportation

Source:266

Description: The railway will be an elevated 9.4-km railway linefrom Diliman, Quezon City to Lerma, Manila including provision ofinterconnecting facilities with neighbouring rail systems.
Output: Ease traffic congestion from usage of private vehicles, reduced
air pollution, and an overall increased efficiency of travelling.263
Cost: PHP51.17bn (USD1.05bn)264
Financial structure: PPP - East-West Rail Transit Corporation andAlloy MTD Philippines Incorporated (Consortium)

Makati Skytrain Project: Fort Bonifacio-Makati Skytrain
Proponent: Department of Transportation (DoTr)
Location: Taguig, Philippines
Status: PlanningClassification: Railway, low-carbon transportation

Source:271

Description: This project involves the design, engineering,
construction, operation, and maintenance of a 1.873 km monorailsystem connecting Fort Bonifacio and the EDSA Guadalupe.269
Output: This project aims to facilitate easy and fast access to andfrom uptown Bonifacio and reduce travel time and mitigate traffic
congestion along the major thoroughfares in the area.270
Cost: PHP3.52bn (USD75.5m)

Philippines GIIO Report Climate Bonds Initiative

Financial structure: Unsolicited, Build-Transfer-Operate (BTO)

29

Light rail extension in Manila: Manila LRT Line 1 Cavite Extension and Maintenance
Proponent: Light Rail Manila Corporation
Location: National Capital Region, Metro Manila Region
Status: Planned (construction begins 2021)
Classification: Railway, low-carbon transportation
Description: The LRT Line 1 was the first metro line of the Manila
LRT system. The project will connect the existing 20.7 km line
serving Metro Manila in the Philippines by approximately 11.7 km.
The proposed project will extend the existing line from Baclaran to
Bacoor city in Cavite Province.

Output: Ease the traffic congestion in the Paranaque-Las PinasCavite corridor, improving commuting efficiency, and carry morethan 1 million passengers per-day.
Cost: PHP64.9bn (USD1.34bn).272

Source:274

A passenger transfer facility shall also be provided proximate
to the EDSA-Balintawak station of LRT Line 1 and the MRT 11
Balintawak station.
Financial structure: PPP (Consortium of Ayala Corporation,
Metro Pacific Light Rail Corporation, and Macquarie Infrastructure
Holdings), 32-year concession and Official Development
Assistance by the Japan International Cooperation Agency

Automatic Fare Collection System for Metro and Light Rail: Automatic Fare Collection System276
Proponent: Department of Transportation (DOTr)
Location: National Capital Region
Status: Completed
Classification: Railway, low-carbon transportation

Output: Increase the convenience, efficiency, and accessibility ofthese public transport modes to people.
Cost: PHP1.72bn (USD35.43m)

30Source:275

Description: The project involved the decommissioning of theprevious magnetic-based ticketing system and replacing the samewith contactless-based smart card technology called the Beep
Card™ on LRT Line 1 and 2 and MRT Line 3, with the introductionof a centralized back office that will perform apportionment ofrevenues. The private sector operates and maintains the farecollection system.273

Financial structure: PPP, Build-Transfer-Operate (BTO), and BuildOwn-Operate (BOO)

Philippines GIIO Report Climate Bonds Initiative

Sustainable water management
Assets that do not increase
greenhouse gas emissions orthat aim at emission reductions
over the operational lifetime of
the asset, address adaptation,and increase the resilience ofsurrounding environments.
These assets cover built aswell as nature-based water
infrastructure.
Water management projects
could include water capture andcollection, water storage, water
treatment (with methane emissions
treatment), flood defence,drought defence, stormwater
management, and ecologicalrestoration and management.
Sector overview
The Philippines is one of the most vulnerable
countries to the impacts of climate change
due to its high exposure to extreme weather
events such as typhoons and floods.277
The Philippines has been facing a challenge
to sustain its water supply as climatechange-induced prolonged drought strains
the availability of water supply.
In March 2019, the greater Manila area
experienced one of the worse water crisis–
exacerbated by the El Nino–that led to
60% decline in rainfall and prevented dams
from achieving ideal water elevations.278,279
Delays to the construction of other water
reservoirs exacerbated the situation.280
The challenge of water insecurity, caused byclimate change, is compounded by increased
population growth and urbanization.
Despite the challenges imposed by rising
population and climate change, the Philippines
has made progress in increasing access toclean potable water. Between 2016 and 2017,
the Philippines increased access to clean waterby 5%. In the 2017 Annual Poverty Indicators
Survey (APIS) by the Philippine Statistics
Authority (PSA), 88% of the Filipino families
have improved source of drinking water,compared to 83.2% in 2016.281,282 The number

is slightly higher in urban areas than rural
areas, 97% and 91%, respectively.283
The government has also set an ambitious
water access and sanitation target by 2022.
According to the Philippine Development
Plan 2017-2022 released in 2017, thegovernment aims to achieve 97.46% of basic
sanitation access, and 95.16% access to safe
water supply by 2022.284 The Philippines
annual water supply and sanitation
investment needs currently exceed theavailable funding by approximately fivefold.285 The World Bank indicated that thepresent value of additional investment inwater supply and sanitation alone, needed
through 2030, will exceed USD1.7tn.286
The Philippine Development Plan also aims
to continue its largest flood management
initiative, the Metro Manila Flood Control
Management Project, which began
construction in January 2018.287 Under
Duterte’s administration, the governmentis also rolling out massive flood control andmitigation infrastructure projects.
Some of these projects are the USD650m
Ambal-Simuay River and Rio Grande de
Mindanao River flood control project, andthe USD195m Cavite Industrial Area FloodManagement project. Both are set to begin
construction in 2020.288 Secretary of the
Department of Public Works and Highways(DPWH) Mark A. Villar expressed that the
DPWH will “continue to build more flood
control structures nationwide on highly
susceptible areas, as a a mitigation measure
to protect citizens, properties,
and livelihood.”289

Financing pathways
Most of the Philippines’ sustainable waterprojects are funded by a combination ofbilateral government agencies, multilateralbanks, and the national government
budget. For example, the flagship flood
protection project, Metro Manila FloodControl Management Project, was fundedcollectively by the World Bank, AsianInfrastructure Investment Bank (AIIB),

Philippines GIIO Report Climate Bonds Initiative

and the national government. They eachcontributed USD207.6m, USD207.6m,
and USD84.79m, respectively, totaling
USD500m to fund the project.290
PPP and joint ventures are also used by
the government to develop sustainable
water projects. Joint ventures are cited as
the preferable form by the private sector.
In 2018, the World Bank engagement withwater supply and sanitation private sector
stakeholders indicated that joint ventures
are preferred over the PPP framework.
Although, there exist major opportunities
in PPP projects. Global Water Intelligenceidentified that the size of the total proposed
investment for water-related PPPs was
USD1.05bn between 2016-2017.291
The participation of the private sector is central
to developing water infrastructure under theadministration’s Build, Build, Build agenda.292
To attract greater private sector participation,
the government has offered several services toreduce the risk for private sector investment inwater projects, such as Viability Gap Funding
and the blending of public or donor funds tocatalyse commercial investments that would
otherwise have higher risk.293
The Manila Water Inc. USD500m
Sustainability bond, issued on July 2020, is
an example of how green and sustainability
bonds are well suited to fund water
infrastructure, and could complement thefunding of public water infrastructure issued
by the local governments (provinces, cities,
or utility companies owned by them). Localbanks could also issue a green bond to fundgreen projects. For example, the Bank of thePhilippine Islands (BPI) recently issued a
CHF100m public Swiss franc-denominatedbond to fund eligible green projects. The
eligibility of the green project is determinedbased on BPI’s green bond framework that isaligned to the ASEAN green bond standards.
Sustainable water infrastructure projectis an eligible green project category under
the framework. Three other green bonds
issued in the Philippines also allocated use ofproceeds to water projects.

31

Baggao Water Supply Project
Proponent: Municipal government of Baggao
Location: Baggao, Cagayan Province
Status: Under construction (scheduled to be completed end of 2020)
Classification: Water treatment, water infrastructure, water
Description: The water supply facility will be comprised of areservoir, a piped distribution network, with adequate treatment
facility, and household taps. This project is structured as BuildOperate-Transfer with a 25-year concession period.294 This
project will provide clean and potable water supply to individual
households (Level 3) in the 24 barangays (administrative district).
Source:299

Output: The water supply system will serve some 21,160
population out of the total municipal population of 78,200 orservice coverage of 27.6%.295
Cost: PHP84m (USD1.7m)
Financial structure: PPP, Build-Operate-Transfer

Angat Water Transmission Improvement Project (AWTIP)298
Proponent: Metropolitan Waterworks and Sewerage System(MWSS)
Location: Norzagaray Municipality, Province of Bulacan
Status: Under construction
Classification: Water distribution, water infrastructure, water

Output: The project will improve the reliability of the raw watersupply for Metro Manila through rehabilitation of the transmission
system from Ipo to La Mesa and the introduction of water safety,
risk, and asset management plans.297

32

Source:300

Description: The project involves the construction of a new
hydraulic tunnel including a new intake structure at Ipo reservoir
and channel, connecting the tunnel outlet to existing aqueducts.
The tunnel has a length of 6.45 km with an internal diameterof 4.2m.296 Whilst the tunnel has been completed ancillary works
are ongoing.

Cost: PHP6.1bn (USD125.7m)
Financial structure: Loan, Ordinary capital resources

Philippines GIIO Report Climate Bonds Initiative

Integrated Flood Risk Management Sector Project301
Proponent: The Department of Public Works and Highways
Location: Six river basins (Apayao-Abulog and Abra in Luzon,
Jalaur in Visayas, and Agus, Buayan-Malungon, and TagumLibuganon in Mindanao)
Status: Planned
Classification: Flood risk management
Description: The Integrated Flood Risk Management Sector
Project will reduce flood risks in six river basins by (i) improving
flood risk management (FRM) planning through strengthening
data acquisition and data management, and improving flood
protection asset management; (ii) rehabilitating andconstructing flood protection infrastructure; and (iii) raisingcommunity awareness and preparing and implementing
disaster (flood) risk reduction and management plans to
reduce different groups’ vulnerabilities.

Source:303

Output: The project will reduce flood risk in the six river basins,
addressing flood risk and enhancing climate resilience.
Cost: PHP27bn (USD556.2m) (indicative)
Financial structure: Loan from ADB with co-financing (indicative)

Water supply in Central Luzon: Bulacan Bulk Water Supply Project302
Proponent: San Miguel Holdings Corp. and Korea Water Resources
Corporation
Location: Central Luzon
Status: Completed (April 2019)
Classification: Water treatment and distribution

The private partner will undertake the financing, detailed designand construction, and maintenance of conveyance facilities,
treatment facilities and water source.

Source:304

Description: The project included the construction of various
components, such as a water treatment plant - complete withsupport buildings and structures, treated water reservoir,
including Sludge Treatment Facility and, raw and Treated Water
conveyance facilities complete with necessary appurtenances.
Cost: PHP24.41bn (USD502.8m)
Financial structure: PPP (Build-Operate-Transfer)

Output: This project provides millions of residents from 24
localities in Bulacan fresh, and potable surface water, to meetthe needs from growing population, industry, agriculture, andenvironment in the area.

Philippines GIIO Report Climate Bonds Initiative33

Wawa Bulk Water Supply Project in Central Luzon: Wawa Bulk Water Supply Project309
Proponent: Metropolitan Waterworks and Sewerage System(MWSS) (government proponent), Razon’s Prime Infra (private
proponent), Oscar Violago’s San Lorenzo Ruiz Builders Group(private proponent).305
Location: Central Luzon
Status: Planning
Source:310

Classification: Water treatment, water infrastructure, water
Description: This facility will ensure water security for thegreater Metro Manila area in the coming years, this project will
help address the water supply deficit in the Eastern Zone under
Manila Water.306
Output: This project will supply 80 million liters per day of waterin 2021, and more than 500 million liters-per-day (MLD) of
water supply in 2025. The facility will provide water to the Wawa
catchment area in Rizal province that will traverse the municipalityof Rodriguez and the city of Antipolo.307

34

Cost: PHP20bn (USD412m)308
Financial structure: Joint venture

Philippines GIIO Report Climate Bonds Initiative

Sustainable waste management
The efficient use of resources to
cut down on waste production,
coupled with collection anddisposal systems that promotereuse and recycle, thereby
minimising residual waste going
into energy from waste facilities.
Where waste must go to landfill,
there are gas capture systems
installed to minimise emissions aswell as measures to minimise runoff and other negative impacts on
surrounding environ ments.
Sector overview
The waste sector in the Philippines is the thirdlargest contributor to the country’s GHG
emissions.311 In 2012, the waste sector
contributed 10% of total GHG emissions, after
the energy (36%) and transportation sectors(16%), and it remained the third largest GHG
contributing sector in 2018.312
The country is estimated to generate 40,000
tons of solid urban waste per day, or 14.6
million tons annually.313 The large volume
of municipal solid waste in the Philippines
is mainly driven by urbanization and thegrowing population, with the National
Capital Region (NCR) producing the largest
volume of waste.314 Plastic is a big part of thenational waste issue, with 50% of the waste
collected being plastic. Since mid-2019,
3,810 tons of plastic garbage was collectedfrom the Greater Manila area alone.315
Philippines’ National Solid Waste Management
Commission (NSWMC) estimated that
Philippine cities will increase their municipal
solid waste production by 165% to 77,776
tons daily by 2025.316 If this challenge
remains under-managed, the waste sector
will pose a more serious risk for health andenvironmental problems in the Philippines,
such as the contamination of ground andsurface water and the spread of disease. 317
The most relevant waste management
regulation for waste today is the Ecological
Solid Waste Management Act introduced in
2000. It aims to manage waste collection anddisposal sustainably.318 Two notable targets
from the legislation were establishment ofmaterials recovery facilities (MRF), and theclosure of open dumpsites and conversion
into sanitary landfill and disposal facilities
that prevent liquid discharges from polluting
ground and surface waters.319,320
Waste management in the Philippines isadministered by local government units(LGUs). The legislation requires LGUs to
submit a Sustainable Waste Management

10-year plan and to comply with the reduce,reuse, and recycle (3R) principle.321 By 2018,
100% of LGUs in the NCR had submitted a
Sustainable Waste Management plan, butmany LGUs do not yet comply fully with
their plans, with only 308 out of 1,634 LGUs
having operational sanitary landfills.322,323
LGUs face challenges in the construction,
operation and monitoring of sanitary
landfill facilities.324 This is mainly due toinsufficient technical and financial resources
and capacity to help the LGUs achieve theRA 9003 sanitary landfill target.325 Some
LGUs have tried to solve this problem byoutsourcing waste collection service toprivate contractors, but further private sector
participation is needed, especially to scale
up the construction of waste treatment andrecovery facilities. The Government of thePhilippines has been pushing policies toattract investors to participate in sustainablewaste management.326
The Philippines generates a high percentage
of organic and recyclable waste: in 2018,biodegradable waste (52%) dominated thewaste component, followed by recyclable
waste (28%).327 The majority of LGUs havesuccessfully established community-level
activities in waste collection, segregation,and in establishing materials recovery
facilities and composting facilities - throughpartnerships established at a small scalewith local informal partners.328
There are many opportunities to improveand develop sustainable waste management
infrastructure. For example, the increasing
interest from LGUs to develop Waste-toEnergy (WtE) facilities is cited as a large
opportunity by the Public-Private Partnership(PPP) Center for potential renewableenergy and sustainable waste investors.329
Investing in WtE facilities can yield both
environmental and financial benefits.
WtE electricity production is only considered
low emissions technology when the waste
used has been sorted and does not include
plastics or metals. These facilities canmitigate GHG emissions by generatingenergy from landfill gas, reducing waste, andpromoting reuse/recycling practices. They
also create new revenue streams (or savings)
for municipalities as they sell off excessenergy into the grid.
The Philippines also has multiple plastic waste
recycling facilities, including an innovativemodel that makes roads and cement withplastic garbage. Philippine companies like
San Miguel Corp. and Aboitiz Equity Ventures
Inc. are using discarded shopping bags,

Philippines GIIO Report Climate Bonds Initiative

sachet wrappers, and plastic packaging to fire
cement plants and build roads in support ofthe country’s infrastructure development
plans.330 In November 2019, San Miguel laid
down the first road, combining plastic scraps
with asphalt; the surface material, developedwith Dow Chemical Co., used 900kg of plastic
to pave 1,500-square meters of road.331

Financing pathways
Most of the major waste management
assets and projects in the Philippines are
publicly owned, with public financing usedprimarily for waste treatment facilities,
waste-to-energy processing, and sanitaryrefill infrastructure. Waste treatment
facilities usually demand significant capital.
Development via PPPs or through theissuance of green bonds could offer options
for municipalities to fund projects.
Public-Private Partnerships (PPPs) are a
key avenue for the private sector to invest
in sustainable waste management projects.
The Philippine government is preparing andplanning for WtE projects under its PPP
scheme - the first of which was approvedin 2018. The USD108m project owned by
the Puerto Princesa Local Government and
AusWorks Corp should enter into construction
in 2020.332 The PPP Center is also currently
preparing for WtE proposals in Quezon City
in Cebu, Naga City in Camarines Sur, andCalahunan Engineered Sanitary Landfill in
Mandurriao District, Iloilo City.333,334
The PPP Center recognized the challenge ofthe lack of bankable infrastructure projects
and introduced several policies to address this.
For example, the Center is looking to bundle
smaller projects by LGUs to make them more
attractive for investors.335 Additionally, thegovernment is introducing a hybrid PPP
scheme, commonly referred as blended
finance, where the initial project stages
are funded using government funds or
multilateral development banks, with the PPP
component reserved for project operationand maintenance.336
Green bonds are also a viable pathway to invest
in the country’s green projects: four green bonds
have been issued in the Philippines with useof proceeds for waste. The Development Bankof the Philippines is one of the public sector
issuers that has a Green Financing Program toassist strategic sectors, industries, and LGUs
in adapting environment-friendly processes
and technologies and incorporating climatechange adaptation, mitigation, and disasterrisk reduction measures by providing
financing and technical assistance.337,338

35

Waste-to-energy: Quezon City Integrated Solid Waste Management Facility339
Proponent: Quezon City Government
Location: Quezon City, National Capital Region (NCR)
Status: Planned
Classification: Facilities for collection, sorting and material
recovery, preparation, waste and pollution control

Output: The facility is capable of processing up to 3,000 metric tonsof municipal solid waste per day and generate 36 MW per day.
Cost: PHP22bn (USD453.2m)

Source:341

Description: The project involves the design, financing,
construction, operation, and maintenance of a biodegradable
source separated waste treatment and residual combustible
waste treatment facility. It has a WtE component.
Financial structure: PPP (Joint venture) - Consortium composedof Metro Pacific Investments Corporation, Covanta Energy LLC,
and Macquarie Capital Limited

Recycle Plant: Coca-Cola Beverages Philippines Inc. Recycling Facility (food-grade)340
Proponent: Coca-Cola Beverages Philippines (CCBPI) andIndorama Ventures
Location: General Trias, Cavite
Status: Under construction (set to be completed in 2021)
Classification: Recycling facilities, recycling, waste and air
pollution control

Output: The facility will contribute to the improvement of PET
collection and recycling rates in the Philippines

Source:342

Description: The recycling facility will collect, sort, clean, andwash post-consumer polyethylene terephthalate (PET) plastic
bottles and turn them into new bottles using advanced technology.
The plant is projected to handle 30,000 metric tons of plastic a
year, or almost 2 billion pieces of plastic bottles per year.
Cost: PHP1bn (USD20.6m)
Financial structure: Joint venture

Waste-to-energy (WTE) facility Pangasinan: Waste-to-energy facility Pangasinan343
Proponent: Green Atom Renewable Energy Corporation
Location: Inmanduyan, Pangasinan
Status: Under construction (set to be operational in 2022)
Classification: Waste to energy plants (e.g. incineration,
gasification, pyrolysis, and plasma), waste-to-energy, waste andpollution control

Output: Improved waste management capacity, and additionalenergy supply
Cost: PHP4.5bn (USD92.7m)
Financial structure: PPP

36

Source:344

Description: This plant will convert garbage and wastes into a 6
MW power generator.

Philippines GIIO Report Climate Bonds Initiative

Reclamation facilities: IRI Philippines, Inc. solid waste recycling and reclamation facility346
Proponent: IRI Philippines, Inc.
Location: Calamba City, Laguna
Status: Completed
Classification: Recycling facilities, recycling, waste and air
pollution control

Output: This project is reducing the amount of waste goingto landfill and reclaiming non-ferrous and precious metals- from electronic production rejects, computer parts andtelecommunication equipment.

Source:347

Description: IRI specializes in solid waste recycling andreclamation. It has been primarily servicing the semiconductor
and electronics industries, offering the best prices for production
rejects, scrap, and excess materials. IRI recycles and reclaims
these materials which are mostly non-ferrous and precious
metals. It also recycles plastic wastes and is into the import andexport of non-ferrous and precious metals.345
Cost: PHP350m (USD7.2m)
Financial structure: Corporate financing

Sustainable Tourism Development Project : Baguio City Sanitation Improvement Project (BCSIP)
Proponent: Department of Natural Resources and Environment;
City of Baguio
Location: Baguio City
Status: Planned

Description: This project involves the rehabilitation and expansionof existingsewage treatment plant and the sewer network in
Balili catchment area, development of a new treatment plant andsewer network in Asin Galiano catchment area, and developmentof a feacal sludge management strategy including feacal sludge
treatment facilities for the whole city of Baguio.

Source:348

Classification: Sewerage network and treatment plant; septage
collection and treatment

Cost: USD100m
Financial structure: Loan from ADB

Output: The project will support Baguio City to efficiently andsustainably deliver sanitation services

Philippines GIIO Report Climate Bonds Initiative37

Other green opportunities
Green and energy efficientbuildings
Green buildings will play animportant role in achieving
the Philippines climate
and energy efficiency
targets. According to thePhilippines’ Departmentof Energy, building energy consumption
accounts for about 15-20% of nationwide
electric power consumption.349 Reducing
energy loss through improved efficiency inbuildings can deliver both economic andenvironmental benefits by reducing GHG
emissions and energy bills. 350
Residential and commercial buildings havethe greatest energy efficiency potential
in the Philippines Energy Efficiency andConservation Roadmap (2017 - 2040).
The roadmap provides a trajectory for
the Philippines to achieve its energy
efficiency goal by 2040. In the plan, thePhilippines commits to reduce energy
consumption in commercial buildings
by 25% and in residential buildings by
20%, against a 2014 baseline, by 2040.351
One of the key outcomes of the roadmap
was the passing of the Energy Efficiency
Conservation Act, which was signed into
law on 12 April 2019 and which aims
to standardize energy efficiency andconservation measures by regulating energyefficient technologies in buildings.352
Prior to the introduction of the roadmap,
the Philippines had already been retrofitting
old buildings to be more energy efficientand using green building codes to ensurethat future buildings meet energy efficiency
standards. In 2013, through a project
supported by ADB, the government
retrofitted 135 government buildings, andalmost 4,000 public park and streetlights
with energy-efficient lighting systems. This
resulted in a total cumulative energy savingof 321 GWh per year, or almost a third of thebuildings’ average energy consumption. The
successful implementation facilitated thedevelopment of the Green Building Rating
System in the Philippines.353
In 2015, the government introduced the Green
Building Code (GB code), which aims to
reduce emissions through increasing energy
efficiency in building design, construction,and operation. It sets the minimum green
standard related to energy efficiency, water
and wastewater management, solid waste
management, site sustainability, and indoor
environmental quality.354 The scheme isconsistent with existing international green
building certification entities.
38

Prior to the introduction of the code,
voluntary green building certification alreadyexisted. For example, international green
building certification schemes such as LEEDand the Philippines’ own local green building
certification, BERDE (Building for EcologicallyResponsive Design Excellence) have been
widely adopted by real estate developers.355
However, the major step taken to formalize
the code has pushed the Philippines closer
to fulfilling its GHG emission reduction goalfor 2030. The implementation of the codeis expected to reduce GHG emissions andenergy consumption nationally by at least
20%.356 It also should boost the growth ofgreen building initiatives in the private sector,
as the statute enforces project owners andproperty developers to comply with thegreen standard at the outset by making it
difficult to obtain a building permit without
meeting the green building standard.357,358
Strong support from the government andthe development of green building-enabling
regulations creates a promising opportunity
for an increase in green buildings and retrofit
projects in the Philippines.
Projects relating to green buildings andbuildings retrofits are not included in the
project pipeline within this report as they
are not traditionally seen as ‘infrastructure’.
However, they make up a large proportionof the global green bond market andopportunity for green bond growth in thePhilippines. Already, six of the Philippines
green bonds have proceeds allocated togreen buildings. In February 2020, Arthalandissued a PHP3bn green bond to financegreen buildings.
Going beyond buildings efficiency, there arealso huge opportunities for both emissions
reductions and green finance within broader
urban planning and development (suchas district heating and cooling) as wellas in industrial efficiency. The definitionsof what can be included as Paris-aligned
within industrial energy efficiency are still
being discussed within the Climate Bonds
Initiative, the European Taxonomy andglobally. It is likely, however, that any suchdefinitions will fit within the ambitious
efforts to align hard-to-abate sectors with
the Paris Agreement as articulated recently
in the Climate Bonds white paper ‘Financing
Credible Transitions.’359

Sustainable land use
Land plays a key role inclimate change mitigation,
as a source and sink of
GHGs. Land-related GHG
emissions are largely causedby land-use change activities
such as clearing forest for agricultural land.361
Globally, poor land management has led todegradation of soils, a loss in biodiversity anddesertification.362 The rate of land degradation
will be intensified by the effects of climatechange through increased flooding, drought
and heat stress.363
In the Philippines, poor land management
causes stress on the nation’s long-term
capacity to ensure food security and provide
ecosystem services for tourism activities.
It is estimated that the Philippines has a totalof 132,275km2 of degraded lands and 5.3m
hectares of land that is severely eroded.364,365
In 2016, the government created thenational Land Degradation Neutrality(LDN) targets and framework. The LDN
is achieved when the availability of land
resources necessary to support ecosystem
functions remain stable and able to sustain
the country’s long-term land needs.366 The
LDN addresses existing land management
challenges, opportunities, and identifies
land-based emission reduction pathways
from different sectors.
These LDN targets have been incorporated
into the Philippine National Action
Plan, 2017-2022, and are tied to national
climate adaptation solutions. The LDN
targets and framework provide a linkage
between the sectors that are critical to the
SLM progress, such as the agriculture andforestry sectors.367
The incorporation of targets into the NDC steps
was monumental in enabling the Philippines
to further attract and tap into global financing
opportunities for sustainable land management
and climate change, such as through theGreen Climate Fund. The LDC framework
makes the sustainable land management
progress more trackable, therefore able
to demonstrate the direct contributionof the agriculture and natural resourcesmanagement sectors to the national climatechange mitigation and adaptation targets.368

Green loans also have the potential to grow,with banks such as Bank of Philippine Islands
having successfully provided financing
for hundreds of projects involving energy
efficiency and climate resilience.360

The ambitious sustainable land use
efforts described mean the Philippines
is well-positioned to attract public andprivate funding for sustainable land use
management. This could also result in thefirst Philippines green bonds relating tosustainable land use in the future.

Philippines GIIO Report Climate Bonds InitiativeMeasures for growing green infrastructure
The growth of green infrastructure pipelines
and associated green finance (including
the green bond market) in the Philippines
can be aided by key policy and institutionalchanges. Such measures could aim to raise
the profile of green infrastructure, support
critical finance channels for infrastructuredevelopment stakeholders, diversify risks
and create more options for investors.
Key measures for could include to:369• Incorporate climate
risk exposure into new
infrastructure plans,
accounting for future
depreciation of assets due
to change in precipitation
patterns, temperature increases andextreme weather events.
• Improve the visibility of green
investment opportunities to help
investors understand that there is asufficiently large pool of financiallyattractive investments that are also green.
• Adjust regulatory requirements,
including the promotion of a standardized
Green Tagging approach for project
finance and integration of climate criteria.

• Issue a sovereign greenbond, to send a strong
signal to the market.
Sovereign bonds are wellunderstood, frequently
issued products that are included in mostinvestment strategies. A sovereign green
bond can kickstart a local green bond market
by bringing scale to domestic markets
through benchmark pricing, liquidity, andprecedent. For governments with access todomestic and international capital markets,
sovereign green bonds can also help attract
the private sector-based investment
needed for sustainable developments andto fulfil the objectives of its NDC.
• Promote the issuance of local government
green bonds – this could include incentives
such as credit enhancement for local
governments or establishing a green
municipal finance for local governments toaggregate debt requirements and accesslower cost of capital.

• Offer incentives, such as governmentbacked grants, to cover green bond issuancecosts (often including the cost of obtaining
an external review); subsidy schemes forinterest rates or third-party engagement;
and/or launch incentives for issuers orinvestors, such as a tax-exemption toincrease investor engagement.
• Partner with development
entities, moving beyondloans, to leverage
and reduce the risk of
infrastructure projects
and attract a wider range of investors,
for example, through the developmentof foreign exchange products, political
coverage and credit enhancement
products or offering credit guarantees,
and adopting a blended finance approachin order to channel capital flows–possibly
in combination with credit support toimprove the bankability of projects.

• Promote “COVID
Recovery” bondprogrammes, with
the issuance of green,
resilience and/or blue
bonds that support a moresustainable recovery, and which exclude
activities which are at risk from future
shocks, for instance assets that could
become stranded as a result of climate
policy changes, or which are not resilient
to climate physical risks.

Philippines GIIO Report Climate Bonds Initiative39

Annex I: Green debt instruments370
Debt Instrument

Definition

ExampleSovereign green
bonds

Proceeds are allocated to nominatedprojects and assets. Debt securities
carry the credit rating of the issuingState. However, an independent
rating may be assigned by ratings
agencies.

The Republic of Indonesia issued a USD1.25bn 5-year green sovereign
sukuk in 2018 to finance eligible projects under a range of categories:
renewable energy, energy efficiency, adaptation, transport, green
buildings, sustainable agriculture, sustainable management of natural
resources and green tourism.

Supra-national
green bonds

Proceeds are allocated to nominatedprojects and assets. Debt securities
carry the credit rating of theissuing supra-national. However, an
independent rating may be assignedby ratings agencies.

In the Philippines, the bond, dubbed “Mabuhay bond” is the first pesodenominated, internationally rated triple-A, issued by International
Finance Corporation (IFC), a multilateral bank.371 The PHP4.8bn(USD98.9m) proceeds will go to repair the Malitbog Geothermal Powerstation that was damaged due to an earthquake. This project is owned
by local renewable energy developer Energy Development Corporation(EDC), located in Kananga city in Leyte province.372

Sub-sovereign
green bonds

Proceeds are allocated to nominatedprojects and assets within thesponsoring region. Credit rating is basedon that of the issuing municipality andthe credit quality of the underlying
assets, but it can also receive aguarantee from the central government,
if it does not have its own rating.

In 2016, the Vietnam Ministry of Finance approved a pilot project formunicipal green bonds. In September 2016, the People’s Committee of
Ba Ria Vung Tau Province came to market with a VND80bn (USD4m)
5-year green bond to finance a water resource management project.
Shortly after, Ho Chi Minh City Finance and Investment State- Owned
Company issued a VND523.5bn (USD23m) 15-year green bond withproceeds allocated to 11 projects related to the water, adaptation, andinfrastructure sectors.

This instrument has not yet been used in the Philippines.

This instrument has not yet been used in the Philippines.
General obligation
green bondProceeds are allocated to nominatedprojects and assets within thesponsoring region. The bond will carrythe credit rating of the issuing entity.

Singapore state development bank DBS Group issued a USD500m
5-year green bond in July 2017. Proceeds will be allocated to green
buildings, transport, renewable energy, energy efficiency, waste, andadaptation.
This instrument has not yet been used in the Philippines.

Green revenue bondGreen convertible
bondGreen project bond(project finance)

40

Proceeds are allocated on nominatedprojects and assets linked with amunicipal government. As the green
bonds are backed at least partially by
the specific revenue streams (mostoften tax receipts, lease fees or otherreceivables) bonds with no recourse
to the issuer.

In 2017 Beijing Enterprises Water Group, which operates 19 water
treatment plants under contracts with 16 municipalities, issued asecuritisation backed by water treatment service fee receivables. The
proceeds are to be invested in 9 new water infrastructure projects.

Proceeds are allocated on nominatedprojects and assets. The debt security
can be converted into a predeterminedamount of the company’s common
stock. The bond may carry the credit
rating of the issuing entity, but they
are often unrated.

Japan-based Sumitomo Forestry Co., Ltd issued the first green
convertible bond in September 2018 to refinance the acquisition of
30,000 hectares of FSC certified timberlands and plantation forests in
Nelson, New Zealand. The Stock Acquisition Rights give bondholders theoption to acquire the company’s common stock.

Proceeds are allocated on nominatedprojects and assets. Credit rating isbased on the quality of the backing
green assets and the returns stream of
the underlying project.

On February 2020, the boutique property developer Arthaland Corp.
launched on a green bond offer worth as much as PHP3bn, raising fresh
funds for its growing portfolio of green developments.373

This instrument has not yet been used in the Philippines.

This instrument has not yet been used in the Philippines.

In the Philippines, AP Renewables, a subsidiary of Manila-based energy
company Aboitiz Power, issued a green bond to refinance a 676.9MW
geothermal project in the Philippines which it had bought from thegovernment in 2009.374 Issued in 2016, this PHP10.7bn (USD220.4m)
deal was the first green bond in ASEAN to be certified under Climate
Bonds Standard.375

Philippines GIIO Report Climate Bonds InitiativeDebt Instrument

Definition

ExampleGreen sukuk

Proceeds are allocated on nominatedprojects and assets using a shariahcompliant trust structure. Credit rating
is based on the quality of the backing
green assets and the lease payment
stream of the underlying project.

In July 2017, Tadau Energy Sdn Bhd, a Malaysian-based renewableenergy and sustainable technology investment firm issued the world’s
first green sukuk of RM250m. The preceeds are used to finance theconstruction of large-scale solar (LSS) photovoltaic power plants in
Kudat, Sabah, with a tenure of 2 to 16 years.376

Debt securities backed by a poolof underlying assets. Proceeds
are allocated only to nominatedprojects and assets. The credit risk isdependent on the asset risks.

In the Philippines, in January 2019, AC Energy Finance International
Limited, a wholly owned subsidiary of AC Energy Inc issued a USDdenominated senior Green Bond, at an aggregate principal amount of
USD585m with a 5-year tenor and a coupon of 4.75% per annum, priced
at 99.451. The Bonds have received pre-issuance certification as Climate
Bonds under the Climate Bonds Standard (“CBS”). This is the firstpublicly syndicated CBI-certified USD Green Bond in Southeast Asia.377

Green structured
finance (seniorunsecured)This instrument has not been used in the Philippines.

September 2019: The Bank of the Philippine Islands (BPI) has raised
USD300m from the issuance of green bonds, making it the firstPhilippine bank to issue dollar-denominated ASEAN green bonds.
The senior unsecured fixed rate ASEAN green bonds due September
2024 were priced at 99.641 with a re-offer yield of 2.577 percent. The
bonds carry a coupon of 2.5 percent per annum, payable semi-annually.
Net proceeds from the bonds would be used for the financing or refinancing of green eligible projects, as further described in BPI’s Green
Finance Framework.378
August 2019: Bank of the Philippine Islands (BPI) has raised anequivalent of about PHP5.28bn from a pioneering Swiss francdenominated green bond issue that gives it two-year interest-freemoney. This is the first public Swiss franc-denominated benchmark
bond (CHF100m) from the Philippines, the first ASEAN (Association ofSoutheast Asian Nations) green bond benchmark for BPI and the first
rated Philippine green bond in the international market. It is also thefirst negative-yielding bonds to be issued out of the Philippines in theinternational capital markets. These bonds carry zero annual coupon
and will mature in 2021. Net proceeds from the bonds will be used forthe financing and/or re-financing of “green” eligible projects such assustainable water and wastewater management, pollution prevention
and control, and green buildings.379
February 2019: RCBC issued a PHP15bn ( USD309m) green bond;proceeds from the issue will be used to support RCBC’s expansion andinitiatives in the green space.380 In particular, the additional capital willbe allocated to fund and refinance loans issued for renewable energy,
green buildings, clean transportation, energy efficiency as well as
pollution prevention and control. This bond is aligned with ASEAN Green
Bond Standards 2018.
2017: BDO Unibank issued its first green bond investment for USD150m
to fund climate-smart projects such as renewable energy, green
buildings, and energy-efficient equipment. The International Finance
Cooperation (IFC) is the sole investor of this bond.
Private Placement

Green bond placed directly with
the investor/s. Details of the deal
such as pricing and maturity may
remain confidential, but the issuer is
expected to disclose details on thenominated projects and assets to befinanced.

Philippines GIIO Report Climate Bonds Initiative

In the Philippines, BDO Unibank issued its first green bond investment
for USD150m to fund climate-smart projects such as renewable energy,
green buildings and energy efficient equipment. The International
Finance Cooperation (IFC) is the sole investor of this bond.381

41

Debt Instrument

Definition

ExampleStructured
finance: Greensecuritisation,
Green tranches in
ABS and MBS deals

Debt securities backed by a granularpool of underlying loan or mortgage
assets. Proceeds are allocated only
to nominated projects and assets.
Often an independent credit rating isissued by a rating agency, but this is
not a requirement. The credit risk isdependent on the assets’ risks.

Harvest Capital (China) has issued Green Commercial Mortgage-backed
Securities (CMBS) secured on a LEED Gold Certified office building
owned by China Energy Conservation and Environmental Protection
Group (CECEP).

Structured finance:
Mezzanine andsubordinated debt

Proceeds are allocated on nominatedprojects and assets. Hybrid capital
investments, from developmentbanks seeking to support private
investment in the senior debt or frominvestors with a higher risk appetite.

Global investment manager AMP Capital provided a EUR245m
mezzanine finance facility of EUR245m to Neoen, a French renewableenergy provider. In May 2018, Canadian insurance company Manulife
Financial issued a CAD600m (USD464m) 10-year green subordinatedsecured bond.

Proceeds allocated to nominatedgreen projects/assets. Part of the
project’s risk is transferred from theissuer to investors. The payments
to investors are conditional to theproject achieving an expected
outcome after a third-party
evaluation has been conducted.

DC Water and Sewer Authority issued a USD25m private placementin 2016 to finance the construction of green infrastructure designed
to mimic natural processes to absorb and slow surges of stormwater
during periods of heavy rainfall. If the outcome of the project meets
expectations, no contingent payment will be due to investors. If it
exceeds expectation, investors will make a Risk Payment Share of
USD3.3m to DC Water. If it does not achieve expectations, DC Water
will make an outcome payment to investors.

Environmental
impact bonds/payfor-results green
bondsThis instrument has not yet been used in the Philippines.

This instrument has not yet been used for green projects in the Philippines.

This instrument has not yet been used in the Philippines.
Green loans,
syndicated loans
and credit lines

Provide lending to encourage market
development in climate-aligned
sectors in line with the Climate
Bonds Taxonomy and in compliancewith the Green Loan Principles.
Interest rates are based on borrower
credit scores or an ESG scoreassigned by an ESG rating agency.

Land Bank has a renewable energy lending program that covers a wide
range of technologies and eligible borrowers. The bank offers financing
support to low carbon building initiatives.

Perpetual GreenBond

A perpetual bond is a fixed income
security with no maturity date. This
type of bond can be considered as a
type of equity, rather than debt. This
type of bond pay a steady stream ofinterest payments forever or until
they are called.

AC Energy issued a USD400m perpetual green bond under the
ASEAN Green Bond Standards in December 2019. Proceeds areused to expand renewable energy projects across the Asia Pacific,
including the Philippines.382

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Philippines GIIO Report Climate Bonds Initiative

Annex II: Green equity instruments383
Equity Instrument

Definition

ExamplePublic- Private
Partnership (PPP)

A long-term contract between apublic entity and a private party
aimed at developing and supportinga public asset or service. The private
party takes on significant risk andmanagement responsibility, andremuneration is linked to performance.

In the Philippines, the Light Rail Transit (LRT) 6 Cavite Line A
involves the construction, operation, and maintenance of an
approximately 23.5 km rail. The rail will extend to cover all cities
in the Province of Cavite. The PPP structure of this project is buildoperate-transfer.384 The project is due to be completed in 2022.385
Prime Asset Ventures Inc. (PAVI) proposed to undertake the design,
financing, construction, O&M of the Project.386

Joint venture,
partnership

Business agreement between two or
more parties that pool their capital,
skills and resources to achieve a
specific project or business activity.

In the Philippines, the local government of Quezon City recently linked
up with a consortium by the Metro Pacific Investments Corp (MPIC),
Covanta Energy, LLC and Macquarie Group Ltd. to undertake an
integrated solid waste management facility (ISWM) as a joint venture.387
The facility will be able to process up to 3,000 metric tons per day ofthe city’s municipal solid waste and convert this into some 42 MW ofrenewable energy. The energy generated will be enough to power between
60,000 to 90,000 homes.388 The project will have a concession period of
35 years. At the moment, Quezon City local government is inviting local
and international entities to submit comparative proposals for the design,
financing, construction, operation, and maintenance for the facility.389

Private equity,
venture capital,
and unlisted equity
funds

Fund allocations to innovative pilotscale green projects including for
qualified green infrastructure. Aidproject developers and entrepreneurs
to secure a funding stream for green
projects. PE often incorporates green
indicators into process.

The Renewable Energy Asia Fund (REAF I) and REAF II invest in smallhydro, wind, geothermal, solar and biomass projects in Asian developing
markets, with a primary focus to date in India, the Philippines, andIndonesia.390 REAF made equity investments in small renewable energy
projects such as on-grid solar, wind, waste-to-energy and hydropower
projects of between 5 MW and 100 MW in these three countries.391

Subsidiary/project
financing vehicles/
YieldCos

Use of proceeds to fund a portfolioof (offbalance sheet) green projects.
Private or publicly traded vehicle
consisting of pools of long-term
cash-generating green assets, may
have tax advantages.

City Developments Limited (CDL) issued an SG100m (USD71m) senior secured
Certified Climate Bond in April 2017 through its wholly owned subsidiary CDL
Properties Ltd to refinance an intercompany loan extended by CDL to CDLP for
Republic Plaza, one of Singapore’s tallest skyscrapers and a premium Grade A
office building in the heart of Singapore’s Central Business District. US YieldCos
Terraform Global and Terraform Power were established by SunEdison in2015 and issued green bonds to finance solar, hydro and wind assets.
This instrument has not yet been used in the Philippines.

Investment Trusts

Use of proceeds to fund a portfolioof green projects. Publicly tradedvehicle consisting of pools of longterm cash generating green assets,
may have tax advantages.

US REIT Hannon Armstrong issued a debut USD100m ABS in 2013. The
deal was secured on ground lease receivables from 78 solar and windfarms. Leasing land to renewable energy operators carries lower risk
than owning and operating the solar and wind farms. Pooling the leases
creates diversity of income streams, a prized feature of securitisations,which further lowers deal risk.
This instrument has not yet been used in the Philippines.

Green ExchangeTraded Funds

The fund buys green bonds toreplicate a public index

Solactive/Carbon Care Asia’s Sustainability Bond Index has been createdand hopes to generate sufficient interest to get ETFs going, providing new
liquidity (from retail investors, for example) to the green bond market.
This instrument has not yet been used in the Philippines.

Infrastructure/property funds

Fund directly investing in nominatedinfrastructure projects. Funds canhave a mixed financing structure byboth investing directly in assets andthrough debt subscription.

The ASEAN Infrastructure Fund (AIF), launched in 2011, is dedicatedto fund green infrastructure development needs by mobilizing regionalsavings, including foreign exchange reserves. By September 2019, theAIF has committed USD520m for nine projects and has a total portfolio
size of around USD3bn, including ADB co-financing.392
At the moment, these projects are from Indonesia, Vietnam, Myanmar,and the Lao People’s Democratic Republic, but green projects in thePhilippines are eligible for this fund.393

Philippines GIIO Report Climate Bonds Initiative43

Annex III: Credit enhancement mechanisms394
Credit enhancement
mechanisms

Definition

ExampleFull or partial credit
guarantee (PCG)

A credit guarantee or PCG is created to absorb
part or all the debt service default risk of an
infrastructure project, irrespective of the causeof default. PCGs can be used for any commercial
debt instrument (loans, bonds) from a private
lender. The existence or proposed implementationof a PCG is indicative of confidence in the productbeing floated by the guaranteeing entity and caneven assist in bringing new lenders to the table.

The Government of Vietnam provides partial credit
guarantees (maximum coverage level at 70% of the
project’s total investment capital) for green projects(e.g. the renewable energy sector) through the Vietnam
Development Bank.395,396

PRGs cover private lenders and investors forcertain risks of lending to private, sovereign or subsovereign borrowers. A PRG can cover a number ofsovereign or sub-sovereign risks such as currency
inconvertibility, repatriation, expropriation,
political force majeure such as war, regulatory
risk, and government payment obligations (suchas tariffs). It can also cover private projects forcompletion risk. Some additional risks can becovered with insurance companies.

On December 31, 2015, the Multilateral Investment
Guarantee Agency (MIGA) issued a USD39.7m guarantee
to a number of lenders, led by Goldman Sachs and Bank ofTokyo Mitsubishi. The loan was guaranteed by the Ministryof Finance - acting for and on behalf of the Governmentof Vietnam - to support the construction of the Hoi Xuan
Hydropower Plant in Thanh Hoa, Vietnam. The plant
was to produce and sell electricity to the national utility
company, Vietnam Electricity (EVN), under a powerpurchase agreement. The guarantee covered the risk of
non-honouring of sovereign financial obligations withregard to the Government’s repayment guarantee to thelenders with tenor of 15 years.

Partial risk
guarantee/ Project
Completion Risk/
Political risk
guarantee

Rating agencies may look favourably to projects,
which benefit from specific risk insurance, such ascompletion risk or other types of risk, resulting ina higher credit rating for the resulting green bondissuance.
Infrastructure
guarantee
mechanisms

Guarantee Funds

This instrument has not yet been used for green projects in
the Philippines.

This instrument has not yet been used for green projects in
the Philippines.
Local Government Unit Guarantee Corporation (LGUGC)
facilitates access of creditworthy LGUs with financially
viable infrastructure or development projects to theprivate capital market by providing guarantees for bankloans or bond flotations. LGUGC managed the guarantee
funds for Access to the Sustainable Energy Project and theDepartment of Energy-Loan Guarantee Fund Program.
The LGUGC was dissolved in December 2019, and some
aspects of its function were absorbed by the Philguarantee.

Partial risk swap
guarantees

Credit guarantee

Credit Guarantee and Investment Facility (CGIF) provides
guarantees for local currency denominated bonds issuedby corporations in the region. Such guarantees will make iteasier for corporations to issue local currency bonds withlonger maturities.

Partial Swap Guarantees cover investors against
the risks arising from currency swaps in crossborder transactions or where the debt service cash
flow is in a different currency from the deal cash
flows, which would require the issuer to hedge thecurrency mismatch to provide comfort to investors
that payments can be made in the debt currency.

Brazil-based private sector bank Unibanco issued JPY25bn
10-year amortising notes backed by the banks’ USD
denominated offshore remittance flows. The deal wasplaced with Japanese institutional investors, who required
a hedging on the currency mismatch. To reduce the credit
exposure for the institution providing the currency swap,
the issue obtained a PSG from the IFC.
This instrument has not yet been used for green projects in
the Philippines.

Foreign ExchangeCounterparty Risk
Hedging

44

Investors often prefer to invest in hard currency andlocal borrowers want to borrow in their domestic
currency. When an issuer hedges the FX risk of an
offshore bond issue, it will need to book a perfect
hedge with a bank. This creates market-to-market
credit risk exposure. Some guarantors offer, against
an upfront payment, to assume this risk.

MFX Solutions offers a mechanism to take the mark-tomarket counterparty exposure for FX hedges, in particularfor illiquid currencies or longer tenor, which the TCX Fundcan offer.
This instrument has not yet been used for green projects in
the Philippines.

Philippines GIIO Report Climate Bonds Initiative

Credit enhancement
mechanisms

Definition

ExampleFirst-loss provisions

First-loss provisions refer to any clause designed
to protect investors from the loss of capital that is
exposed first if there is a financial loss of security.
These could be debt, equity or derivatives instruments
including mezzanine finance, cash facilities orguarantees. They could also take the form of insurance
that insures debt security providers who are liable
to pay compensation to the investors, irrespectiveof the cause of the loss. They can also be structured
as an equity note in a structured deal transaction:buyers of these notes will see their capital writtenoff, in case the amount of losses on the underlying
portfolio exceeds the assumptions made on theovercollateralization of the underlying portfolio.

The Green Cornerstone Bond Fund, created by the IFC
and Amundi and launched in March 2018, is the world’s
largest targeted green bond fund focused on investing inemerging markets. To lower risk and attract private sector
investments, the IFC will provide a first-loss coveragethrough a junior tranche.

Contingent loans are often used in project financeto backstop the main debt by providing a payment
option for specific case scenarios. For instance, if thegovernment fails to obtain quality cash flows, thecontingent loan is triggered, and investors are paid.

There have been no green projects using contingent loans
to date.

Concessional loans are loans that are granted on
substantially more generous terms compared tomarket loans, which is achieved through belowthe-market interest rates, longer grant periods or a
combination of both.

The HDBank solar power programme, which amounted
to VND7,000bn,398 was established to exclusively financesolar power projects. The solar power loans aim to provide
up to 70% of the project’s total investment capital with aduration of no more than 12 years.399

Contingent loans

Concessional loan

The Credit Guarantee Investment Facility provides credit
guarantees for local currency denominated bonds issued
by investment grade companies in ASEAN+3 countries.
Companies from Thailand, Vietnam, Singapore, Indonesia,
and the Philippines have used this facility.397

This instrument has not yet been used for green projects in
the Philippines.

This instrument has not yet been used for green projects in
the Philippines.
ESCOs (Energy
Service Companies)

Viability gap
funding (VGF)

A/B loans or grants

ESCOs provide technical and financial services for the
implementation of energy efficiency solutions. Undera Guaranteed Saving Scheme, the ESCO guarantees
a certain level of energy savings, thus assuming theperformance risk. With a Shared Savings Model,
higher energy savings determine a lower cost of
the energy service. In both schemes, financing cancome either from the ESCO or a third party.

SolarBK is an example of an ESCO in Vietnam. The
company provides two main services through the ESCO
model, namely: Solar Power and Solar Water Heating.
Finance is generated based on energy savings efficiency
brought about by ESCO.400
This instrument has not yet been used for green projects in
the Philippines.

VGF is used specifically in infrastructure to coverfor the heavy upfront funding that is required tokickstart projects. An analysis of the viability ofa proposed project points out the weak areasthat prevent large-scale funding from being
obtained. A VGF scheme can be implemented
through capital grants, subordinated loans or eveninterest subsidies to target specific issues that are
affecting the viability of the project. A blended
finance approach could also be used to reduce
project risk.

The Coc San Hydropower project in Vietnam was successfully
implemented through Viability Gap Funding in the form of
a USD5m grant from the Technical Assistance Facility by
The Private Infrastructure Development Group (PIDG), in
2013.401 The finance helped to offset part of the up-front
preparation costs of pro-poor infrastructure investments
in Coc San, Lao Cai province - the most mountainous areain Vietnam. (This was not specifically labelled as a green
deal; however, it was financing for a green project.)

A/B loans or grants are where a MultilateralDevelopment Bank (MDB) offers the “A” portionof the loan while attracting other lenders to join
in a second (or “B”) tranche. The MDB will be thelender-of-record, lead lender, and administrative
agent in the transaction. This reduces part of therisks of the operations, by also being covered by the“umbrella” of the MDBs that include a preferredcreditor status and de jure immunity from taxation.

Italian transmissions system operator Terna issued a USD81m
green loan in project finance format in July 2017. The
Inter-American Development Bank offered the USD56m
A loan and BBVA subscribed a B loan for USD25m. The
deal will finance the design and construction of a 213km
transmission line of 500kv in the northeast of Uruguay.

Philippines GIIO Report Climate Bonds Initiative

This instrument has not yet been used for green projects in
the Philippines.

This instrument has not yet been used for green projects in
the Philippines.

45Annex IV: Risk transfer/ risk sharing mechanisms402
Risk transfer
mechanism typeMechanism available in the Philippines

Example description

First-loss capital

May provide a risk-buffer for green structures
and thereby encourage institutional investors.
First loss capital incorporated into the capital
structure usually as a junior equity tranche or as
subordinated debt.

The Clean Energy Finance Corporation’s (CEFC)
AUD100m equity investment in Australian Prime Property
Fund Commercial.

Synthetic green
capital notes or
securitisation

Risk management (de-risking) to release loss
reserves, with the use of freed capital to fundgreen projects. Reduce risk weighting of assets,
while keeping the assets tied to the banks’balance-sheet and the current operations.

A global example is Credit Agricole’s USD3bn synthetic
ABS used to free up risk capital for green loan origination.

Loan loss reserves

Pooled public funds set aside by a financial
institution to partially recover loss in their loan
portfolio in the event of borrower defaults.
If the institution issues green bonds, loan loss
reserves can improve the risk profile of the deal
by providing additional assurance on the issuer’s
cash flows.

This instrument has not yet been used for green projects in
the Philippines.

Risk sharing facility(RSF)/Default swap

These structures support a transaction involving aloss-sharing agreement, where the originator will
be reimbursed in the case of a loss of principal ona portfolio of eligible assets (mortgages, consumer
or student debt, energy efficiency loans, SME
loans, receivables). Originators are mainly banks
and corporations.

The Scaling Up Energy Efficiency for Industrial Enterprises
in Vietnam project, funded by the World Bank and theGreen Climate Fund will offer a Risk Sharing Facility
amounting to USD78m for energy efficiency investment.
The project will facilitate more than 100 industrial
enterprises to reduce energy consumption and mitigate
GHG emission of 120 MtCO2 over the lifetime of theinvestment.403 This instrument has not yet been used forgreen projects in the Philippines.

Currency Risk
Hedge

Non-deliverable forward hedging

The Currency Risk Protection Program (CRPP)
of the Philippine Central Bank is aimed at alleviating
demand pressures in the foreign exchange spot market
from borrowers seeking to hedge their future foreignexchange exposures.404

This instrument has not yet been used for green projects in
the Philippines.

This instrument has not yet been used in the Philippines.

This could apply to green projects in the Philippines.

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Philippines GIIO Report Climate Bonds Initiative

Annex V Green standards applicable in the Philippines405
Green Standard

Description

Sectors

Applicability in the Philippines

Philippines Green
Building CodeThe Green Building Code, referred to as the
GB code, was launched in June 2015 by the
Department of Public Works and Highways(DPWH) with the assistance of the World
Bank-IFC and with the technical support of thePhilippine Green Building Initiative (PGBI).406 This
GB Code is a set of regulations with minimum
standards for compliance and is not intended torate buildings.407

Buildings

This code can be applied to hotels/
resorts, schools, hospitals, businessoffices, and mixed occupancy
properties with required minimum
total gross floor area of 10,000
sq. meters; 15,000 sq. meters formalls; and 20,000 sq. meters forcondominiums.411

The Code seeks to improve the efficiency ofbuilding performance through a framework ofstandards that will enhance sound environmental
and resource management to counter harmful
gases, throughout the building’s life cycle,
including the efficient use of materials, site
selection, planning, design, construction, use,
occupancy, operation, and maintenance without
significant increases in cost.408
Building for
EcologicallyResponsive Design
Excellence (BERDE)BERDE Program was established by the Philippine
Green Building Council (PHILGBC) in 2009 as an
appropriate response to the Philippine building
industry’s need to proactively address the negative
impacts of climate change. BERDE is recognizedby the government, through the Department ofEnergy (DOE), as the National Voluntary Green
Building Rating System.409

Building,
energyefficiency

This framework is applicablethroughout the Philippines.
The Net Lima, an office building, wasthe first project to be certified underthe BERDE rating tool of the Philippine
Green Building Council with a 4-starrating in 2017.412

ASEAN Green Bond
Standards (AGBS)

The standards were developed and launched in
November 2017 by the ASEAN Capital Markets
Forum. The standards also provide guidance on theclassification of green projects in the region thatare qualified for AGBS label in the region. These
projects specifically exclude fossil fuel-related
projects. Companies in Malaysia, Singapore, andIndonesia have already issued bonds labelled as
ASEAN Green Bonds.410

Energy,Transport,
Water,
Buildings, ICT,
Waste, NatureBased Assets,
Industry andCommercial
activities

On August 2018, The Philippines’
Securities and Exchange Commission(SEC) approved the AGBS. They
adopted guidelines in line with theASEAN Green Bond Standards thatprovide for the rules and procedures forthe issuance of ASEAN Green Bonds in
the Philippines.413

ASEAN
Sustainability
Bond Standards(ASEAN SUS)415

The standards provide the framework to finance or
re-finance a combination of both Green and Social
Projects that respectively offer environmental
and social benefits. It also provides guidance onclassification of sustainable projects.

Energy,Transport,
Water,
Buildings, ICT,
Waste, Nature
Based Assets,
Industry andCommercial
activities

The SEC Philippines approved on April
2019 the “Guidelines on the Issuanceof Sustainability Bonds Under the
ASEAN Sustainability Bond Standards(ASEAN SUS)” through Memorandum
Circular Nos. 8, Series of 2019.

Waste,
commercial
activities

The Department of Environmental
and Natural Resources (DENR) is thefirst public agency in the Philippines tomeet ISO 14001 in 2015. The agency isin the process of rolling out a training
program to make all regional offices
ISO 14001 certified.414

National Standards
for Environmental
Management
Systems(ISO 14001)416

The ISO 14001 standard specifies requirements foran effective environmental management system(EMS). It provides a framework that an organization
can follow to better control its environmental
impacts.

Philippines GIIO Report Climate Bonds Initiative

RCBC bank is the first to issue aPhilippine ASEAN Sustainability bondamounting to PHP8bn on June 2019.

47

Green Standard

Description

Sectors

Applicability in the Philippines

Effective energy
management
systems (EnMS)/
ISO 50001423

The ISO 50001 standard establishes aninternational framework for the supply, use, andconsumption of energy in industrial, commercial,and institutional organizations. Implement an ISO
50001 compliant sustainable energy management
system and demonstrate organization’scommitment to continuously improving energy
performance, leading to economic benefits andreduced greenhouse gas emissions.

Renewableenergy, Energy
efficiency

This framework is applicable in thePhilippines. In 2017, there were six
ISO 50001 certified companies in
the Philippines: ADB, Manila Water,
Shimano, Continental Temic, Maynilad,and Cemex.418

Certified Emission
Reduction (CERs)

Certified Emission Reduction (CERs) is a Clean
Development Mechanism (CDM) that allows acountry with an emission-reduction or emissionlimitation commitment under the Kyoto Protocol(Annex B Party) to implement an emissionreduction project in developing countries. CERs
is used to identify projects that can earn saleablecarbon credits.417

Energy,Transport,
Water,
Buildings,
ICT, Waste
TreatmentThis framework can be applied in thePhilippines. The Methane recovery andcombustion with renewable energy
generation from anaerobic animal
manure under the Land Bank of thePhilippines‘ (LBP) Carbon FinanceSupport Facility is an example of a
project that is certified CER.419

Climate Bonds
Taxonomy424

Climate Bonds Taxonomy is used to identify
green projects and assets which are aligned withachieving the goals of the Paris Agreement. This
excludes fossil fuel power generation, internal
combustion engine personal vehicles and newroads and infrastructure that facilitate their
movement, and freight rail that is primarily used
for fossil fuel transportation.

Energy,Transport,
Water,
Buildings,
ICT, Waste,
Nature- Based
Assets,Industry andCommercial
activities

There is currently one green bondfrom the Philippines that is aligned
to the Climate Bonds Taxonomy. AP
Renewables’ USD226m deal fromearly 2016 was the first in ASEAN to
be Certified under the Climate Bonds
Standard, a sign of best practice in themarket in terms of climate ambition.
The proceeds finance geothermal
power generation.
The USD410m total green bondissuance by AC Energy – USD300m
issued on January 2019; and USD110m
issued on February 2019 – is also
CBI certified.

SOURCE

SOURCE is a global standard created by
Sustainable Infrastructure Foundation (SIF). It offers
governments a global, reliable, secure, and userfriendly project preparation software to maximize
public sector users financing options including PPPs
by providing well-prepared projects in a consistentand transparent way to the international communityof contractors, investors, and lenders.

Infrastructure

The Philippines completed its SOURCE
integration implementation on
May 2019. This implementation is
supported by the Asian Development
Bank (ADB). The focal agency of theintegration has been the National
PPP center, under the oversight of the
Ministry of Finance.420

The Standard
for Sustainable
and Resilient
Infrastructure(SuRe)

SuRe is a global voluntary standard which integrates
key criteria of sustainability and resilience into
infrastructure development and upgrade, through14 themes covering 61 criteria across governance,social, and environmental factors.

InfrastructureThis framework could be applied in
the Philippines. There is an ongoingpilot project desktop assessmenton motorway, harbour, and urban
development in the Philippines.421

Envision

Envision is a framework that includes 64
sustainability and resilience indicators, called‘credits’ organized around five categories:
Quality of Life, Leadership, Resource Allocation,
Natural World, and Climate and Resilience.
These collectively address areas of humanwellbeing, mobility, community development,
collaboration, planning, economy, materials,
energy, water, sitting, conservation, ecology,
emissions, and resilience.

Infrastructure

No certified projects in the Philippines
at the moment, but this framework
could be applied in the Philippines.422

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Philippines GIIO Report Climate Bonds Initiative

Annex VI: Sample Green Pipeline
This sample pipeline includes a list of ‘green’and ‘potentially green’ projects taken fromvarious publicly available sources. The four
sectors are covered in the list are: low carbon
transport, renewable energy, sustainable
water management and sustainable waste
management. The assessment of the‘greenness’ of each project was based on the
Climate Bonds Taxonomy (see back cover).

Methodology
An analysis of two key government projectpipelines and various projects owned bydifferent proponents show that there arevarious green projects of different sizes andtechnologies spread across the country.
These pipelines are obtained mainly fromthe official infrastructure project list by thePhilippines National Economic Development
Authority (NEDA) and the Public-Private
Partnerships Center (PPPC). This analysis
also includes projects from the AsianDevelopment Bank (ADB), various media
sources such as articles, press releases, andother government Departments.

Project Status
Completed: High profile, recently completed
projects, including projects that are currently
operational
Under construction: Major projects fromnational, state and local government
pipelines that are under construction

Planned: Major projects from national, stateand local government pipelines that have
not yet begun construction but have beenannounced and undergone business caseplanning and/or have an allocated budget.
This includes those projects that are either
waiting for relevant government bodies,at pre-construction stage, at procurement
stage , or under development.
Potential (optional): Speculative projects
and/or plans featured in strategy documents
and/or media announcements but are lessconcrete, e.g. (but limited to) no specificbudget and/or no specific investor and/or no
specific time-line.

Green projects
SectorProject nameLocationTransport

MRT-11 Project425

Manila, National
Capital Region

East-West Rail Project426

Cost

StatusGreenness

PipelinesourceNotes

PHP71.10bn(USD1.5bn)

Planned

Green

PPP
CenterFor approvalof relevant
government
bodiesDiliman, Quezon
City to Lerma,
ManilaPHP55.46bn(USD1.1bn)

Planned

Green

PPP
CenterFor approvalof relevant
government
bodiesCebu Monorail Transit
System ProjectCentral Visayas

PHP73.24bn(USD1.5bn)

Planned

Green

PPP
CenterFor approvalof relevant
government
bodiesLRT 2 West Extension427

National Capital
Region

PHP10.2bn(USD210.12m)

Underconstruction

Green

NEDA

MRT Line 7428

National Capital
Region

PHP62.7bn(USD1.3bn)

Underconstruction

Green

PPP
CenterLight Rail Transit LineNo. 3 (MRT 3)429

National Capital
Region

USD655m

Completed

Green

PPP
CenterNational Capital
RegionPHP 5.5bn(USD113.3m)

Under
construction

Green

NEDA

Metro Manila BRT Line 1(Quezon Ave)430

National Capital
Region

PHP357bn(USD7.4bn)

Underconstruction

Green

NEDA

Metro Manila Subway
Project Phase 1431

Luzon

PHP57bn(USD1.2bn)

Under
Construction

Green

NEDA

MRT 4432

Luzon

USD149bn(USD3.1bn)

Underconstruction

Green

NEDA

North South Commuter
Railway (PNR North 1)433

Quezon City

PHP628bn(USD12.9bn)

Underconstruction

Green

NEDA

North South Commuter
Railway Extension(PNR North 2, PNRSouth commuter)434

Luzon

National Capital
RegionPhilippines GIIO Report Climate Bonds Initiative

Operational

NEDA

49

Green projects
SectorProject nameLocationTransport

Railway Line 4 Project435

Quezon CityPNR South Long Haul436

50

Cost

StatusGreenness

PipelinesourcePHP59.3(USD1.2bn)

Planned

Green

NEDA

Luzon

PHP175bn(USD3.6bn)

Planning

Green

NEDA

Cebu Bus Rapid
Transit437

Luzon

PHP16.3bn(USD335.8m)

Under
construction

Green

NEDA

Davao Public Transport
Modernization Project(DPTMP)

Mindanao

PHP18.6(USD383.1m)

Planned

Green

NEDA

Subic Clark Railway

Luzon

Under
construction

Green

NEDA

C5 MRT 10 Project438

Manila, National
Capital Region

PHP93.7bn(USD1.9bn)

Planned

Green

PPP
CenterFor approvalof relevant
government
bodiesFort Bonifacio – Makati
Skytrain Project439

Manila, National
Capital Region

PHP3.6bn(USD74.2m)

Planned

Green

PPP
CenterFor approvalof relevant
government
bodies

Davao People Mover440

Davao Region

PHP30bn(USD618m)

Planned

Green

PPP
CenterFor approvalof relevant
government
bodiesModified Light RailTransir (LRT) Line 6
Project441

Province of Cavite,
CALABARZON

PHP73.2bn(USD1.5bn)

Planned

Green

PPP
CenterFor approvalof relevant
government
bodiesCagayan North Railway
System Development442

PHP4.8bn(USD99m)

Planned

Green

NEDA

LRT Line 1 Cavite
Extension and Operation& Maintenance443

PHP64.9bn(USD1.3bn)

Underconstruction

Green

PPP
CenterCost isinclusive of the
PHP19.83bn
ODAcomponent

South Integrated
Transport System
Project (Taguig
Integrated Terminal
Exchange)444

PHP5.2bn(USD107m)

Underconstruction

Green

PPP
Center

1. Currently
undergoing preconstruction

Southwest ITS Project(Parañaque Integrated
Terminal Exchange)445

PHP2.5bn(USD51.5m)

Completed

Green

PPP
CenterOperational

Automatic Fare
Collection System446

PHP1.7bn(USD35m)

Completed

Green

PPP
CenterOperational

PHP50bn(USD1bn)Notes

2. Cost is
inclusive of the
C5-FTI-Skyway
Connector Road
(access ramp]
and cost of land.

Philippines GIIO Report Climate Bonds Initiative

Green projects
SectorProject nameLocation

Cost

StatusGreenness

PipelinesourceNotes

Renewable Energy
Hydropower

Angat Hydroelectric Power
Plant Project Rehabilitation,
Operation and Maintenanceof Auxiliary #4 and #5447

Central Luzon

USD23mPlanning

Potentiallygreen

OthersBakun A/B and C
HydroelectricPower Plant448

Cordillera
Administrative
Region

USD83mCompleted

Potentially
green

PPP
CenterBenguet Province
Mini HydroelectricPower Plant449

Cordillera
Administrative
RegionUSD22mCompleted

Potentially
green

PPP
CenterBinga Hydroelectric Plant450

Cordillera
Administrative
RegionUSD143m

Completed

Potentially
green

PPP
CenterBubunawan run-of-riverhydro power project451

Cagayan deOro, Northern
Mindanao

USD190m

PlannedPotentiallygreen

OthersGeothermal Leyte-Cebu Geothermal
Power Plant452

Wind

Solar

Eastern Visayas

USD305.53m

Completed

Potentially
green

PPP
Center

Leyte-Luzon (Malitbog)
Geothermal Power Plant453

Eastern Visayas

USD630.85m

Completed

Potentially
green

PPP
CenterMakban Binary
Geothermal Plant454

Calabarzon

USD33mCompleted

Potentially
green

PPP
CenterMindanao I
Geothermal Plant455

Soccsksargen

USD79.57m

Completed

Soccsksargen

PPP
CenterMindanao II
Geothermal Plant456

Soccsksargen

USD72.31m

Completed

Potentially
green

PPP
CenterMakban Binary
Geothermal Plant

Calabarzon

USD33mCompleted

Potentiallygreen

OthersBurgos wind farm(150 MW)457

Burgos, Ilocos
Norte

USD450m

Completed

Green

OthersPalawan wind farm458

San Vicente,
PalawaTBD

Planned

Green

OthersBangui wind farm459

Bangui, Ilocos
Norte

USD35mCompleted

Green

OthersCaparispisan wind turbine(81 MW)460

Caparispisan,
Ilocos Norte

USD220m

Completed

Green

OthersSan Lorenzo Wind Farm
(54 MW)461

San Lorenzo,
Guimaras

PHP6.7bn(USD138m)

Completed

Green

OthersBasilan Solar PV Power
Plant Project462

Province ofBasilan

PHP556m(USD11.4m)

Planned

Green

NEDA

Barangay Vista Alegre solar
plant (50 MW)463

Bacolod City

PHP2bn(USD41.2m)

Planned

Green

OthersGIGASOL3 AC Energy Solar
Power Project (60 MW)464

Palauig,
ZambalesPHP6.2bn(USD127.7m)

Underconstruction

Green

OthersToledo Solar Project(60 MW)465

Toledo City, Cebu

PHP4.3bn(USD86.5m)

Completed

Green

OthersPhilippines GIIO Report Climate Bonds Initiative

Operational

Preparation
for feasibility
studies51

Green projects
SectorProject nameLocation

Solar

Transforming landscapefor off-grid electrification
Solar PV466

Camotes andBantayan Islands,
Cebu

Biomass

North Negros Biopower(25 MW)467

Sustainable Water
Management

52

Cost

StatusGreenness

PipelinesourceNotes

PHP848m(USD17.5m)

Planned

Green

PPP
CenterProject
concept note
completed

Municipality of
Manapla, Negros
Occidental

PHP5.6bn(USD155.3m)

Completed

Green

OthersSouth Negros Biopower(25 MW)468

LaCarlota, Negros
Occidental

PHP5.6bn(USD115.3m)

Completed

Green

OthersSan Carlos BioPower(20 MW)469

San Carlos
City, Negros
Occidental

PHP3.8bn(USD78.2m)

Completed

Green

OthersVictorias Milling Company
Biomass Power Plant

Victorias City,
Negros Occidental
Province

USD2bnCompleted

Potentiallygreen

OthersBulacan Bulk Water Supply
Project470

Central Luzon

PHP24.4bn(USD502.6m)

Completed

Potentially
green

PPP
CenterIntegrated Disaster Risk
Reduction and Climate
Change Adaptation
Measures in the Low-Lying
Areas of Pampanga Bay471

Luzon

PHP6.5bn(USD133.9m)

Under
Construction

Green

DPWH

Silway River Corridor
Redevelopment Program(Flood mitigation
measures)472

General Santos
City

PHP1.7bn(USD35m)

Planned

Green

NEDA

Cavite Industrial Area FloodManagement Program473

Luzon

PHP9.9bn(USD204m)

Under
Construction

Green

NEDA

Clark Water Supply and
Sewerage Project474

Central Luzon

PHP240bn(USD4.9bn)

Completed

Potentially
green

PPP
CenterOperational

Subic Water and Sewerage
Project475

Zambales,Central Luzon

USD120m

Completed

Potentially
green

PPP
CenterOperational

Baggao Level III Water
Supply Project476, 477

Baggao, Cagayan,
Cagayan Valley
Region

PHP80m(USD1.6m)

PlannedPotentially
green

PPP
CenterUnder
procurement

Angat Water Transmission
Improvement Project478

Angat, Bulacan

USD134m

PlannedPotentially
green

ADB

Ambal Simuay River and Rio
Grande de Mindanao River
Flood Control Projects479

Mindanao

PHP39.2bn(USD807.5m)

Under
construction

Green

DPWH

Chico River Pump
Irrigation Project480

Luzon

PHP4.7bn(USD96.8m)

Under
construction

Potentiallygreen

OthersKabulnan-2 Multipurpose
Irrigation andPower Project481

Mindanao

PHP32bn(USD659.2m)

Under
construction

Potentiallygreen

National
Irrigation
Administration(NIA)

Wawa Bulk Water Supply
Project482

Luzon

PHP20bn(USD412m)

Planned

Green

OthersBislig City Bulk Water
Supply and Septage
Project483

Bislig City,
Surigao del Sur,
CaragaTBD (to be
determined)

PlannedPotentially
green

PPP
CenterOperational

Ongoingbusiness caseUnderdevelopment

Philippines GIIO Report Climate Bonds Initiative

Green projects
SectorProject nameLocation

Sustainable Water
Management

Lumbo Bulk Water Supply
Project484

San Pablo City,
Laguna andDolores, Quezon,
Calabarzon

Angat Hydroelectric Power
Plant (AHEPP) Project
Rehabilitate, Operation and
Maintenance of Turbines#4 and #5485

Sustainable Waste
Management

Cost

StatusGreenness

PipelinesourceNotes

PHP103m(USD2.1m)

PlannedPotentially
green

PPP
CenterUnder
procurement

Central Luzon

TBD

PlannedPotentially
green

PPP
CenterUnderdevelopment

Marinduque Water Supply
System Project486

Marinduque,Mimaropa

TBD

PlannedPotentially
green

PPP
CenterUnderdevelopment

Ormoc City Water Supply
System Project487

Ormoc City,
Leyte, Eastern
VisayasTBD

PlannedPotentially
green

PPP
CenterUnderdevelopment

Tuguegarao City Septage
Management Project488

Tuguegarao
City, Cagayan,
Cagayan Valley

PHP90m(USD1.8m)

PlannedPotentially
green

PPP
CenterFor Approvalof Relevant
Government
BodiesIntegrated Flood Risk
Management Sector
Project489

Nation-wide

USD400m

Under
construction

Green

ADB

Iloilo City Integrated Solid
Waste Management Facility
Project

Iloilo City, Iloilo,Western Visayas

PlannedPotentially
green

PPP
CenterCoca-Cola Beverages
Philippines Inc. Recycling
Facility (food-grade)490

City of
Parañaque

PHP1bn(USD20.6m)

Under
construction

Potentiallygreen

OthersWaste-to-energy (WTE)
facility Pangasinan491

Pangasinan,
Luzon

USD90mPlannedPotentially
green

DOE

Renewable Energy (RE)
Production and Solid Waste
and Management (SWM)
Facility in Ormoc City492

City Governmentof Ormoc

PHP411mn(USD8.5m)

PlannedPotentially
green

NEDA

WTE facilities Cebu493

Cebu

USD320m

PlannedPotentiallygreen

OthersIRI Philippines, Inc. solid
waste recycling andreclamation facility494

Calamba City,
Laguna

USD7m

Completed

Potentiallygreen

OthersBaguio-La TrinidadItogon-Sablan-Tuba- Tublay(BLISTT) Integrated SWM
Facility495

BLISTT, Provinceof Benguet

PlannedPotentially
green

NEDA

Philippines GIIO Report Climate Bonds Initiative

TBD

PHP500m(USD10.3m)

Underdevelopment

Pre-feasibility
studiesPre-feasibility
studies53Endnotes
1. Climate Bonds Initiative. 2019. Green Infrastructure Investment
Opportunities (GIIO) Programme. https://www.climatebonds.net/
green-infrastructure-investment-opportunities-giio-programme
2. Philstar. 2020. https://www.philstar.com/
business/2020/08/28/2038279/bsp-eyes-more-investmentsgreen-bonds
3. Business World Online. 2020. BSP wants to count green loan
agains agriculture compliance. https://www.bworldonline.com/
bsp-wants-to-count-green-loans-against-agri-agra-compliance/
4. Invest in ASEAN. ASEAN Member States Philippines. Retrieved
from http://investasean.asean.org/index.php/page/view/asean-member-states/view/709/newsid/789/philippines.
html#:~:text=Philippines,are%20the%20country’s%20
key%20assets.&text=A%20founding%20member%20of%20
ASEAN,in%20Asia%20amid%20strong%20growth.
5. World Bank. Retrieved from https://www.worldbank.org/en/
country/philippines/overview
6. ReliefWeb. 2019. World Risk Report. Retrieved fromhttps://reliefweb.int/sites/reliefweb.int/files/resources/
WorldRiskReport-2019_Online_english.pdf
7. Government of the Philippines, PAGASA. Tropical Cyclone
Information. Retrieved from http://bagong.pagasa.dost.gov.ph/climate/tropical-cyclone-information
8. Ibid.
9. IPCC. Retrieved from https://archive.ipcc.ch/ipccreports/tar/
wg2/index.php?idp=625
10. World Bank. 2020. Retrieved from https://www.worldbank.org/
en/news/feature/2020/04/09/the-philippines-transferring-thecost-of-severe-natural-disasters-to-capital-markets
11. Almeida, M., Filkova, M., Harrison, C., and Sette, P. Green Bond
European Investor Survey, Climate Bonds Initiative, November 2019.
12. Japan Credit Rating Agency. https://www.jcr.co.jp/en/ratinglist/
sovereign/12006
13. Climate Bonds Initiative. 2019. Green Infrastructure Investment
Opportunities (GIIO) Programme. https://www.climatebonds.net/
green-infrastructure-investment-opportunities-giio-programme
14. CIA. 2020. The World Factbook. https://www.cia.gov/library/publications/the-world-factbook/geos/print_rp.html
15. Ibid.
16. Ibid.
17. World Bank. 2020. Retrieved from https://data.worldbank.org/
indicator/NY.GDP.MKTP.CD?locations=PH
18. IMF. 2020. World Economic Outlook April 2020. https://www.
imf.org/en/Publications/WEO/Issues/2020/04/14/weo-april2020#Introduction
19. Ibid.
20. Bangko Sentral ng Pilipinas. http://www.bsp.gov.ph/
21.Ibid.
22. The Philippines Department of Finance (DOF). 2020. Regaining
Momentum, Accelerating Recovery in a Post-COVID-19 World.
https://www.dof.gov.ph/regaining-momentum-acceleratingrecovery-in-a-post-covid-19-world/
23. Philippine Statistics Authority. http://www.psa.gov.ph/statistics/survey/price/summary-inflation-report-consumer-priceindex-2012100-february-2020
24. Bangko Sentral ng Pilipinas. 2020. FDI Net Inflows in March
2020 Reach US$507 Million; Q1 2020 Net FDI Inflows at US$1.7
Billion. http://www.bsp.gov.ph/publications/media.asp?id=5414
25. Asian Development Bank. 2020. Asian Bonds Online. https://asianbondsonline.adb.org/economy/?economy=PH
26. Banko Sentral ng Pilipinas. 2020. Treasury Bonds. http://www.
bsp.gov.ph/statistics/sdds/sddstbond.htm
27. CEIC Data. 2020. Philippines Trade Balance. https://www.
ceicdata.com/en/indicator/philippines/trade-balance
28. CEIC Data. 2020. Philippines Government Debt: % of GDP.
https://www.ceicdata.com/en/indicator/philippines/governmentdebt--of-nominal-gdp
29. World Bank. 2020. Philippines: Social Assistance to Poor
Households, Support for Small Enterprises Key to BroadBased Recovery. https://www.worldbank.org/en/news/
press-release/2020/06/09/philippines-social-assistance-topoor-households-support-for-small-enterprises-key-to-broadbased-recovery
30. Government of the Philippines, Department of Finance (DOF).
2020. Regaining Momentum, Accelerating Recovery in a PostCOVID-19 World. https://www.dof.gov.ph/regaining-momentumaccelerating-recovery-in-a-post-covid-19-world/
31. World Bank. 2020. Philippines: Social Assistance to Poor
Households, Support for Small Enterprises Key to BroadBased Recovery. https://www.worldbank.org/en/news/
press-release/2020/06/09/philippines-social-assistance-topoor-households-support-for-small-enterprises-key-to-broadbased-recovery
32. Government of the Philippines, Department of Finance (DOF).
2020. Regaining Momentum, Accelerating Recovery in a PostCOVID-19 World. https://www.dof.gov.ph/regaining-momentumaccelerating-recovery-in-a-post-covid-19-world/
33. Government of the Philippines, Banko Sentral ng Pilipinas. 2020.
The Philippine Economy: On the Road to Recovery
34. World Bank. 2019. Philippines Economic Update October 2019.
https://www.worldbank.org/en/country/philippines/publication/philippines-economic-update-october-2019-edition
35. Ibid.
36. International Monetary Fund. 2018. Philippines Economic
Outlook in Six Charts. https://www.imf.org/en/News/
Articles/2018/09/27/na092718-the-philippines-economicoutlook-in-six-charts
37. Oxford Business Group. 2019. Philippines Year in Review
2019. https://oxfordbusinessgroup.com/news/philippines-yearreview-2019

54

38. Business Inquirer. 2020. Economy Tipped to Grow at Faster
6.5% Pace in 2020. https://business.inquirer.net/286383/
economy-tipped-to-grow-at-a-faster-6-5-pace-in-2020
39. Trading Economics. 2019. https://tradingeconomics.com/
philippines/inflation-cpi?embed?embed/forecast
40. Asia Times. 2020. Philippines Builds Infrastructure to
Spur Economy. https://www.asiatimes.com/2020/01/article/
philippines-builds-infrastructure-to-spur-economy/
41. Ibid.
42. Tomtom Traffic Index. 2019. The Traffic Index. https://www.
tomtom.com/en_gb/traffic-index/ranking/
43. Japan International Cooperation Agency (JICA). 2018. JICA
to help Philippines ease traffic congestion in Metro Manila.
https://www.jica.go.jp/philippine/english/office/topics/
news/180920.html
44. Government of the Philippines, Department of Budget andManagement. 2017. https://www.dbm.gov.ph/index.php/secretarys-corner/press-releases/list-of-press-releases/204-financing-thephilippine-golden-age-of-infrastructure
45. Government of the Philippines, National Economic
Development Authority (NEDA). 2017. Philippine Development
Plan (PDP) 2017-2022. https://www.neda.gov.ph/wp-content/
uploads/2017/01/PIP-Chapter-19-as-of-10042018.pdf
46. Japan International Cooperation Agency (JICA). 2018. JICA tohelp Philippines ease traffic congestion in Metro Manila. https://www.jica.go.jp/philippine/english/office/topics/news/180920.html
47. Government of the Philippines, Bases Conversion andDevelopment Authority (BCDA). 2019. https://bcda.gov.ph/nedaapproves-revised-list-infra-flagship-projects
48. Business Mirror. September 2020. Government revises
flagship project list amid pandemic, NEDA chief bares. https://businessmirror.com.ph/2020/09/10/government-revises-flagshipprojects-list-amid-pandemic-neda-chief-bares/
49. Business Inquirer. 2020. Build, Build Build’s ‘new normal’: 13
projects added, 8 removed. https://business.inquirer.net/304612/
build-build-builds-new-normal-8-projects-added-13-removed
50. The Asean Post. September 2020. “Build Build Build” Program
Amid a Pandemic. https://theaseanpost.com/article/build-buildbuild-program-amid-pandemic
51. Business Mirror. 2020. Govt cuts 2021 infra budget to P1.107
trillion to fund recovery programs amid pandemic. https://businessmirror.com.ph/2020/08/28/govt-cuts-2021-infra-budgetto-p1-107-trillion-to-fund-recovery-programs-amid-pandemic/
52. The Asean Post. September 2020. “Build Build Build” Program
Amid a Pandemic. https://theaseanpost.com/article/build-buildbuild-program-amid-pandemic
53. Government of the Philippines, Public-Private PartnershipCenter (PPPC). September 2020. Infrastructure push to aid
recovery. https://ppp.gov.ph/in_the_news/infrastructure-push-toaid-recovery-2/
54. Government of the Philipines, Philippines Information Agency.
June 2020. DPWH: 6.57-M jobs generated in 4 years under BBB
Program. https://pia.gov.ph/press-releases/releases/1043997
55. Government of the Philippines, Department of Budget andManagement. 2020. https://www.dbm.gov.ph/index.php/
secretary-s-corner/press-releases/list-of-press-releases/204financing-the-philippine-golden-age-of-infrastructure
56. Ibid.
57. Ibid.
58. Government of the Philippines, National Economic andDevelopment Authority (NEDA). 2020. Transcript of NEDA
Acting Secretary Karl Kendrick Chua’s Statement at the DBCC
Budget Briefing on the FY 2021 Proposed. https://www.neda.gov.
ph/transcript-of-neda-acting-secretary-karl-kendrick-chuasstatement-at-the-dbcc-budget-briefing-on-the-fy-2021-proposed/
59. Government of the Philippines, Bases Conversion andDevelopment Authority (BCDA). 2019. https://bcda.gov.ph/nedaapproves-revised-list-infra-flagship-projects
60. International Monetary Fund. 2020. https://www.imf.org/en/
News/Articles/2020/02/06/na020620the-philippines-a-goodtime-to-expand-the-infrastructure-push
61. International Monetary Fund (IMF). 2020. The Philippines: A
good Time to Expand Infrastructure Push. https://www.imf.org/en/
News/Articles/2020/02/06/na020620the-philippines-a-goodtime-to-expand-the-infrastructure-push
62. Government of the Philippines, National Economic
Development Authority (NEDA). 2020. Interview with Nieva T.
Natural from NEDA.
63. Government of the Philippines, PPP Center. 2019. https://ppp.
gov.ph/view-from-the-center-11/
64. Government of the Philippines, PPP Center. 2019. https://
ppp.gov.ph/wp-content/uploads/2019/01/PPPC_PPPGB_ResoSafeguards-in-PPP.pdf
65. Government of the Philippines, NEDA. 2017. The 2017-2022
Public Investment Program. https://www.neda.gov.ph/2017-2022public-investment-program/
66. https://www.neda.gov.ph/policy-guidelines-and-proceduresfor-the-formulation-of-the-three-3-year-rolling-infrastructureprogram-trip/
67. GermanWatch. 2020. Global Climate Risk Index 2020. https://www.germanwatch.org/en/17307
68. Climate Action Tracker. 2018. The Philippines. https://climateactiontracker.org/countries/philippines/2018-12-11/
69. Climate Change Act 2009. Philippines Republic Act No. 9729.
Retrieved from http://extwprlegs1.fao.org/docs/pdf/phi100134.pdf
70. Climate Action Tracker. 2019. Philippines. https://climateactiontracker.org/countries/philippines/
71. Government of the Philippines, Climate Change Comission.
https://climate.gov.ph/our-programs/development-of-the-greenjobs-assessment-and-certification-system-and-guidelines

72. Government of the Philippines, Climate Change Comission.
https://climate.gov.ph/our-programs/development-of-a-nationalframework-and-plan-of-action-for-philippine-climate-smarthospitals
73. Government of the Philippines, Climate Change Commission(CCC). https://climate.gov.ph/our-programs
74. Government of the Philippines, Climate Change Commission(CCC). https://climate.gov.ph/our-programs/development-ofstandards-for-climate-smart-buildings
75. Government of the Philippines, Climate Change Commission(CCC). https://climate.gov.ph/our-programs/national-climate-riskmanagement-framework
76. https://climate.gov.ph/our-programs/development-ofstandards-for-climate-smart-buildings
77. Government of the Philippines, Department of Finance (DOF).
August 2020. CBI Interview with Assistant Secretary Paola Alvarez
78. Ibid.
79. PhilStar. 2019. President Duterte State of the Nation Address.
https://www.philstar.com/headlines/2019/07/22/1936926/fulltext-dutertes-2019-sona-speech
80. Government of the Philippines, Depatment of Energy (DOE).
https://www.doe.gov.ph/press-releases/energy-efficiency-andconservation-act-approved-after-30-years
81. Cebu Daily News. 2020. LGUs urged to implement own energy
efficiency. https://cebudailynews.inquirer.net/290930/lgus-urgedto-implement-own-energy-efficiency-conservation-plan
82. Climate Action Tracker. 2019. Climate Governance:
The Philippines. https://climateactiontracker.org/
documents/663/2019-10-31_CAT_ClimateGovernance_Philippines.
pdf
83. New Climate Institute. 2019. Greenhouse gas mitigation
scenarios for major emitting countries. https://newclimate.org/wpcontent/uploads/2019/12/GHG-Mitigation-Scenarios-Dec2019.pdf
84. IPSOS. 2018. Investing in ASEAN, 2018-2019. https://www.
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85. Forbes. 2019. Why ESG Matters Among Wealthy Investors.
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86. Wing-Far Cheng. 2012. Asia is a long-term investment for
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87. IPSOS. 2018. Investing in ASEAN, 2018-2019. https://www.
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88. Climate Bonds Initiative. 2020. Green Bond European Investor
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89. Ibid.
90. Ibid.
91. Ibid.
92. IPSOS. 2018. Investing in ASEAN, 2018-2019. https://www.
ipsos.com/en/investing-asean-20182019
93. Business World. 2019. DBP raises P18.125 billion
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com/dbp-raises-p18-125-billion-from-sustainabilitybonds/#:~:text=STATE%2DOWNED%20Development%20
Bank%20of,President%20and%20CEO%20Emmanuel%20G.
94. ACMF, ASEAN Green Bond Standard, https://www.theacmf.
org/initiatives/sustainable-finance/asean-green-bond-standards
95. Government of the UK. 2019. ASEAN Low Carbon Energy
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96. Climate Bonds Initiative (CBI). CBI Green Bond Database.
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97. Note that estimates vary, this Climate Bonds Initiative estimatebased on Climate Policy Initiative research
98. Climate Policy Initiative.2019. 2019 Global Landscape of
Climate Finance. https://www.climatepolicyinitiative.org/wpcontent/uploads/2019/11/2019-Global-Landscape-of-ClimateFinance.pdf
99. Business Inquirer. 2019. SEC Notes Leap in PH ‘green’ Bond
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100. Climate Bonds Initiative. 2019. ASEAN Green
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net/system/tdf/reports/cbi_asean_sotm_2019_final.
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102. Ibid.
103. Ibid.
104. Ibid.
105. Climate Bonds Initiative. 2020. CBI Database106. Climate Bonds Initiative. 2020. Climate Bonds Initiative
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107. ICMA. 2020. https://www.icmagroup.org/green-socialand-sustainability-bonds/sustainability-bond-guidelinessbg/#:~:text=Sustainability%20Bonds%20are%20bonds%20
where,both%20Green%20and%20Social%20Projects.; ACMF.
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my/api/documentms/download.ashx?id=3c4f768f-a290-4722b9d1-ef55942fbfde#:~:text=ASEAN%20Sustainability%20
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social%20benefits.
108. Business Inquirer. 2020. BPI to issue PH’s first COVID
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Monitor: Sustainable Debt Universe Tops $1.5 Trillion. https://www.
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Philippines GIIO Report Climate Bonds Initiative110. Climate Bonds Initiative. 2020. CBI Database.
111. ADB. 2020. ADB and Green Finance Committee of China
Society for Finance and Banking Cohost Webinar on Nature-Positive
Stimulus Packages in COVID-19 Recovery.
https://www.adb.org/news/adb-and-green-finance-committeechina-society-finance-and-banking-cohost-webinar-nature
112. Climate Bonds Initiative. 2020. CBI Database.
113. Ibid.
114. Government of the Philippines, Department of Finance. 2020.
Interview with Assistant Secretary Paola Alvarez.
115. Business World. 2020. Government-issued credit guarantees
P216 billion after 2019 merger.
116. Executive Order No. 58, series of 2018. 2018. https://www.
officialgazette.gov.ph/2018/07/23/executive-order-no-58-s-2018/
117. Carolin Schellhorn. 2019. New Time-Dependent Risk–Return
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118. The Conversation. 2019. Investors Willing to Pay Premium for
Debt That Address Climate Change. https://theconversation.com/
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119. Government of the Philippines, SEC. Sustainability Reporting
Guidelines for Publicly Listed Companies. https://www.sec.
gov.ph/wp-content/uploads/2019/11/2018CGFD_5thSECPSECGForumPresentation.pdf
120. Sustainable Stock Exchange Initiative. https://sseinitiative.org/
stock-exchange/pse/
121. Oxford Business Group. 2020. The Philippine Stock Exchange
introduces initiatives to promote sustainable business practices.
https://oxfordbusinessgroup.com/analysis/positive-steps-stockexchange-has-introduced-initiatives-promote-sustainablebusiness-practices
122. Ibid.
123. Philstar. 2020. BSP eyes more investments in green bonds.
https://www.philstar.com/business/2020/08/28/2038279/bspeyes-more-investments-green-bonds
124. Government of the Philippines BSP. 2019. Benjamin E Diokno:
Sustainable finance towards a climate-resilient Philippine economy.
https://www.bis.org/review/r191127h.htm
125. Ibid.
126. Government of the Phililppines, BSP. 2020. http://www.bsp.
gov.ph/downloads/regulations/attachments/2020/c1085.pdf
127. Philstar. 2020. BSP issues guidelines on sustainablefinance framework. https://www.philstar.com/
business/2020/05/03/2011352/bsp-issues-guidelinessustainable-finance-framework
128. Government of the Philippines BSP. 2019. Benjamin E Diokno:
Sustainable finance towards a climate-resilient Philippine economy.
https://www.bis.org/review/r191127h.htm
129. UNFCCC. Sustainable Energy Finance (SEF) Program |Philippines. https://unfccc.int/climate-action/momentum-forchange/financing-for-climate-friendly/sustainable-energy-financeprogram-in-the-philippines#:~:text=The%20groundbreaking%20
Sustainable%20Energy%20Finance,investment%20in%20
sustainable%20energy%20projects.
130. Phil Star Global. 2020. BSP eyes more investments
in green bonds. https://www.philstar.com/
business/2020/08/28/2038279/bsp-eyes-more-investmentsgreen-bonds
131. Development Bank of the Philippines. 2020. Climate Bonds
Initiative DBP email interview.
132. BDO Unibank. 2020. CBI email interview with BDO Unibank.
133. Rizal Commercial Banking Corporation (RCBC).. 2020. CBIemail interview with RCBC.
134. Development Bank of the Philippines. https://www.dbp.ph/developmental-banking/environment-initiatives/green-financingprogram/
135. Philstar. https://www.philstar.com/
business/2012/04/15/796718/dbp-launches-green-financingprogram
136. Development Bank of the Philippines. https://www.dbp.ph/developmental-banking/infrastructure-and-logistics/financingutilities-for-sustainable-energy-development-fused/
137. Development Bank of the Philippines. https://www.dbp.ph/developmental-banking/infrastructure-and-logistics/pasada/138. Development Bank of the Philippines. https://www.dbp.ph/developmental-banking/environment-initiatives/energy-efficiencysavings-e2save-financing-program/
139. Bank of the Philippine Islands (BPI). Sustainable Energy Finance
Program. https://www.bpiexpressonline.com/p/1/203/businessloans-sustainable-energy-finance140. Government of the Philippines, People’s Survival Fund (PSF).
http://psf.climate.gov.ph/about/#:~:text=The%20People’s%20
Survival%20Fund%20(PSF,the%20impacts%20of%20
climate%20change.
141. ADB. 2019. ASEAN Infrastructure Fund: Financing Infrastructurefor Growth and Development.https://www.adb.org/publications/
asean-infrastructure-fund-brochure142. ADB. https://www.adb.org/projects/fund/ASEAN%20
Infrastructure%20Fund?sort_by=search_api_aggregation_3&sort_order=ASC (Accessed July 2020).
143. Bio Invest. https://www.bio-invest.be/en/investments/
renewable-energy-asia-fund-ii#:~:text=The%20Renewable%20
Energy%20Asia%20Fund,India%2C%20the%20Philippines%20
and%20Indonesia.&text=REAF%20II%20is%20a%20
dedicated,South%20and%20South%20East%20Asia.
144. Oiko Credit. Renewable Energy Asia Fund II. https://www.
oikocredit.coop/products-services/equity-investments/equitypartner/50736/renewable-energy-asia-fund-ii

145. Green Climate Fund (GCF). About GCF. https://www.
greenclimate.fund/about
146. Green Climate Fund (GCF). https://www.greenclimate.fund/countries
147. Climate Bonds Initiative. 2019. ASEAN Green Financial
Instruments Guide. https://www.climatebonds.net/system/
tdf/reports/asean_green_fin_istruments_cbi_012019_0.
pdf?file=1&type=node&id=35692
148. Ibid.
149. Ibid.
150. ADB. 2019. New Facility to Mobilize $1 Billion for ASEAN
Green Infrastructure. News Release. https://www.adb.org/news/
new-facility-mobilize-1-billion-asean-green-infrastructure151. UN Industrial Development Organization. Handbook on How to
Access Green Financing in Viet Nam. https://www.unido.org/sites/
default/files/files/2019-01/2018_Green_Financing_in_Viet_Nam.
pdf
152. ADB. 2020. ACGF Overivew. https://www.adb.org/what-wedo/funds/asean-catalytic-green-finance-facility/overview
153. CBI, ADB, and the Sustainable Finance Institute ASEAN (SFIA).
2020. Green Finance Capital Market Approaches to Support PostCOVID Economic Recovery.
154. Climate Bonds Initiative. 2019. Brazil Green Infrastructure
Investment Opportunities (GIIO). https://www.climatebonds.net/
files/reports/cbi_giio_2019_02c_0.pdf
155. Ibid.
156. Ibid.
157. Ibid.
158. Ibid.
159. Climate Analytics. 2019. Decarbonising South and Southeast
Asia Country Profile Philippines. https://climateanalytics.org/media/
decarbonisingasia2019-profile-philippines-climateanalytics.pdf
160. Brazil (GIIO)
161. Brazil (GIIO)
162. Brazil (GIIO)
163. Brazil (GIIO)
164. Climate Bonds Initiative. 2020. CBI Database.
165. Ibid.
166. Project Drawdown (n/a). Electricity Generation Geothermal.
Retrieved from https://www.drawdown.org/solutions/electricitygeneration/geothermal
167. International Energy Agency (2019). Hydropower. Retrieved
from https://www.iea.org/fuels-and-technologies/hydropower
168. UNFCCC (2018). Clean Energy Transition Needs to Accelerate.
Retrieved from https://unfccc.int/news/clean-energy-transitionneeds-to-accelerate
169. UNFCCC (2016). Railway Sector on Track to Acheive Low
Carbon Goals. Retrieved from https://unfccc.int/news/railwaysector-on-track-to-acheive-low-carbon-goals
170. UNFCCC (2015). World Needs to Manage Water moresustainably. Retrieved from https://unfccc.int/news/world-needsto-manage-water-more-sustainably
171. Greenbiz (2016). How the Paris Agreement sparked greenbuilding progress. Retrieved from https://www.greenbiz.com/
article/how-paris-agreement-sparked-green-building-progress
172. Government of the Philippines, DOE. 2017. Philippine Energy
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173. IRENA. 2017. Renewables Readiness Assessment: The
Philippines. https://www.irena.org/-/media/Files/IRENA/Agency/
Publication/2017/Mar/IRENA_RRA_Philippines_2017.pdf
174. Ibid.
175. Government of the Philippines, DOE. 2019. 2018 Power
Statistics. https://www.doe.gov.ph/sites/default/files/pdf/energy_
statistics/01_2018_power_statistics_as_of_29_march_2019_
summary.pdf
176. Institute for Climate and Sustainable Cities. Carving out Coal in
the Philippines. http://icsc.ngo/resources-thumbs/strandedcoal/177. James Guild. 2019. Wiley Online Library. Feed-in-tariffs and thepolitics of renewable energy in Indonesia and the Philippines. https://doi.org/10.1002/app5.288
178. Government of the Philippines, DOE. 2019. Investment
Opportunities in the Philippines Energy Sector. https://www.doe.gov.
ph/sites/default/files/pdf/e_ipo/investment_opportunities_phil_energy_sector.pdf
179. Ibid.
180. https://www.nrel.gov/docs/fy19osti/72798.pdf
181. Investment Opportunities in the Philippines Energy Sector.
182. Governmentof the Philippines. Official Gazette
EE Act 2019. https://www.officialgazette.gov.ph/downloads/2019/04apr/20190412-RA-11285-RRD.pdf
183. Philstar. 2019. DOE Updates Renewable Energy Targets.
https://www.philstar.com/business/2019/09/02/1948208/doeupdates-renewable-energy-targets
184. Philstar. 2019. https://www.philstar.com/
business/2019/09/10/1950436/philippines-seen-lead-southeastasia-carbon-emissions-10-years
185. Government of the Philippines, DOE. https://www.doe.gov.ph/energist/philippines-seen-lead-southeast-asia-carbon-emissions10-years
186. Ibid.
187. Manila Standard. 2020. Renewable Energy Share in PH
power generation hit a new low of 21% in 2019–NREB. http s://manilastandard.net/business/power-technology/326136/
renewable-energy-share-in-ph-power-generation-hit-a-new-lowof-21-in-2019-nreb.html
188. Renewables Readiness Assessment: The Philippines.
189. Government of the Philippines, DOE. Investment Opportunities in
the Philippine Energy Sector. https://www.doe.gov.ph/sites/default/
files/pdf/e_ipo/investment_opportunities_phil_energy_sector.pdf

Philippines GIIO Report Climate Bonds Initiative

190. Government of the Philippines, DOE. 2019. 2018 Power
Statistics. https://www.doe.gov.ph/sites/default/files/pdf/energy_
statistics/01_2018_power_statistics_as_of_29_march_2019_
summary.pdf
191. Renewables Readiness Assessment: The Philippines.
192. Investment Opportunities in the Philippine Energy Sector.
193. Government of the Philippines, DOE. Hydropower. https://www.
doe.gov.ph/hydropower?ckattempt=1194. . Investment Opportunities in the Philippine Energy Sector.
195. Ibid.
196. ASEAN Briefing. 2017. Biomass Industry in the Philippines.
https://www.aseanbriefing.com/news/2017/05/19/biomassindustry-philippines.html
197. Ibid.
198. 2018 Power Statistics
199. Government of the Philippines, DOE. https://www.doe.gov.ph/energist/what%E2%80%99s-vogue-solar-rooftops
200. Asian Power. 2018. Unwieldy rules bar growth of Philippines’
solar rooftop potential. https://asian-power.com/power-utility/news/
unwieldy-rules-bar-growth-philippines-solar-rooftop-potential
201. IEEFA. 2018. Unlocking Solar in the Philippines. http://ieefa.org/
wp-content/uploads/2018/07/Unlocking-Rooftop-Solar-in-thePhilippines_July-2018.pdf
202. GWEC. 2018. Global Wind Report 2018. https://gwec.net/wpcontent/uploads/2019/04/GWEC-Global-Wind-Report-2018.pdf
203. Renewables Readiness Assessment: The Philippines.
204. Oxford Business Group. New investments in oil exploration, gas
imports and renewable capacity aim to meet the Philippines’ surging
energy demand. https://oxfordbusinessgroup.com/overview/
seeking-balance-new-investments-oil-exploration-gas-importsand-renewable-capacity-aim-meet-surging
205. Reve. 2020. Philippines makes move into offshore wind energy.
https://www.evwind.es/2020/03/30/philippines-makes-moveinto-offshore-wind-energy/74224
206. Md ALam Hossain Monda. The Philippines energy futureand low-carbon development strategies. https://doi.org/10.1016/j.
energy.2018.01.039
207. IEEFA. 2019. The Philippine Energy Transition 2019. http://
ieefa.org/wp-content/uploads/2019/03/The-Philippine-EnergyTransition_March-2019.pdf
208. IRENA. 2017. https://www.irena.org/-/media/Files/IRENA/
Agency/Publication/2017/Mar/IRENA_RRA_Philippines_2017.pdf
209. Ibid.
210. Climate Bonds initiative. https://www.climatebonds.net/
resources/press-releases/adb-philippines-geothermal-climatecertified-bond/1mar-2016
211. ADB. 2016. ADB Backs First Climate Bond in Asia in Landmark $225
Million Philippines Deal. https://www.adb.org/news/adb-backs-firstclimate-bond-asia-landmark-225-million-philippines-deal
212. Ibid.
213. Climate Bonds Initiative. 2020. Green Bond Database.
214. Infrastructure Investor. 2017. IFC backs BDO Unibank’s $150m
green bond. https://www.infrastructureinvestor.com/ifc-backs-bdounibanks-150m-green-bond/215. IFC. Creating a Vibrant Green Bond Market in the Philippines.
https://www.ifc.org/wps/wcm/connect/news_ext_content/ifc_
external_corporate_site/news+and+events/news/impact-stories/
green-bond-philippines
216. Global Capital. 2019. AC Energy powers up for Philippine green
market. https://www.globalcapital.com/article/b1ctfx74ln9lyr/acenergy-powers-up-a-first-for-philippine-green-market
217. ADB. 2019. ADB Invests $20 million in AC Energy Climate Bond to
Finance Regional Clean Energy Projects. https://www.adb.org/news/
adb-invests-20-million-ac-energy-climate-bond-finance-regionalclean-energy-projects
218. Ibid.
219. Business World. 2019. AC Energy raises $400 million fromperpetual green bond issue. https://www.bworldonline.com/acenergy-raises-400-million-from-perpetual-green-bond-issue/
220. China Bank. 2018. China Bank issues US$150M
green bond. https://www.chinabank.ph/news.
aspx?title=China+Bank+issues+US$150M+green+bond
221. Government of the Philippines, DOE. 2019. https://www.doe.
gov.ph/sites/default/files/pdf/energy_statistics/01_2018_power_
statistics_as_of_29_march_2019_summary.pdf
222. Ibid.
223. National Geothermal Association of the Philippines.
Geothermal áreas: Tiwi. https://sites.google.com/a/ngaphil.org/
www/services/tiwi
224. ADB. 2016. ADB Backs First Climate Bond in Asia in Landmark$225 Million Philippines Deal. https://www.adb.org/news/adbbacks-first-climate-bond-asia-landmark-225-million-philippinesdeal
225. Image. https://www.archify.com/au/photo/detail/54714
226. Ibid.
227. Reve. 2019. Wind energy in Philippines, green light for San Vicente
wind farm. https://www.evwind.es/2019/11/20/wind-energy-inphilippines-green-light-for-san-vicente-wind-farm/71915
228. Think Geo Energy. 2018. New wells to be drilled at Tiwi-MakBan
geothermal plant in the Philippines. http://www.thinkgeoenergy.com/
new-wells-to-be-drilled-at-tiwi-makban-geothermal-plant-in-thephilippines/
229. Manila Standard. 2019. PetroWind set to invest P1.4b to expand
Nabas wind project. https://manilastandard.net/business/powertechnology/300711/petrowind-set-to-invest-p1-4b-to-expandnabas-wind-project.html
230. Sunstar. 2019. Officials laud VMC’s P2b biomass power plant.
https://www.sunstar.com.ph/article/1804820/Bacolod/Business/
Officials-laud-Victorias-Milling-Companys-P2B-biomass-power-plant
231. Ibid.

55

232. Energy Central. 2020. AC Energy investing P1.9 billion for Lagunasolar plant. https://energycentral.com/news/ac-energy-investingp19-billion-laguna-solar-planthttps://energycentral.com/news/
ac-energy-investing-p19-billion-laguna-solar-plant
233. Thomas Lloyd. North Negros Biopower. https://www.thomaslloyd.com/en/portfolio-item/north-negros-biopower/
234. Interview with AC Energy
235. NEDA. 2017. Philippine Development Plan 2017-2022 Abridge
Version. http://www.neda.gov.ph/wp-content/uploads/2017/12/
Abridged-PDP-2017-2022_Final.pdf
236. NEDA. National Transport Policy. http://www.neda.gov.ph/national-transport-policy/
237. ADB. E-Vehicle Strategy of the Department of Energy. https://www.adb.org/sites/default/files/linked-documents/43207-013phi-oth-02.pdf
238. https://apps.fas.usda.gov/newgainapi/api/report/
downloadreportbyfilename?filename=Biofuels%20Annual_Manila_
Philippines_11-28-2018.pdf
239. Agaton, C., Guno, C., Villanueva, R. & Villanueva, RO. 2019.
Diesel or Electric Jeepeney? A Case Study of Transport Investmentin the Philippines using the Real Options Approach. World Electric
Vehicle Journal 10(3). https://www.mdpi.com/2032-6653/10/3/51
240. Agaton, C., Guno, C., Villanueva, R. & Villanueva, RO. 2019.
Diesel or Electric Jeepeney? A Case Study of Transport Investmentin the Philippines using the Real Options Approach. World Electric
Vehicle Journal 10(3).https://www.mdpi.com/2032-6653/10/3/51
241. http://ltfrb.gov.ph/index.php/puv-modernization-2/
242. Agaton, C., Guno, C., Villanueva, R. & Villanueva, RO. 2019.
Diesel or Electric Jeepeney? A Case Study of Transport Investmentin the Philippines using the Real Options Approach. World Electric
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243. Eco-Business. 2019. Do Filipinos Dream of Electric Jeepneys?
https://www.eco-business.com/news/do-filipinos-dream-of-electricjeepneys/244. BusinessWorld. 2018. First phase of e-jeepney rollout set forJune. https://www.bworldonline.com/first-phase-of-e-jeepneyrollout-set-for-june/245. Eco-Business. 2019. Do Filipinos Dream of Electric Jeepneys?
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246. Philstar. 2019. DOTr: Old jeepneys can temporarily ply roads
beyond 2020 if they meet conditions. https://www.philstar.com/
headlines/2019/11/21/1970669/dotr-old-jeepneys-can-ply-roadsbeyond-2020-long-theyre-roadworthy#bTW2tVMZhjsKePH2.99
247. NPR. 2018. A Push to Modernize Philippine Transport
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248. Eco-Business. 2019. Do Filipinos Dream of Electric Jeepneys?
https://www.eco-business.com/news/do-filipinos-dream-of-electricjeepneys/249. BusinessWorld. 2019. DOTr to focus on railway developmentin 2019. https://www.bworldonline.com/dotr-to-focus-on-railwaydevt-in-2020/
250. Ibid.
251. Government of the US, International Trade Commission.
Philippines Commercial Guide. https://www.export.gov/
article?id=Philippines-Transport-Infrastructure252. Fitch Solutions. 2019. Railway Projects to Support Philippines’
Transport Sector Growth. http://www.fitchsolutions.com/
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253. Ibid.
254. https://www.climatebonds.net/resources/pressreleases/2020/11/climate-bonds-criteria-steer-investmentsshipping-industry-launched
255. ADB. 2019. ADB’s Biggest Project to Improve Transport from
Northern Provinces to Manila. https://www.adb.org/news/features/adbs-biggest-philippine-project-improve-transport-northernprovinces-manila
256. Milken Institute. 2017. Investing in Transportation Infrastructurein the Philippines. https://milkeninstitute.org/sites/default/files/
reports-pdf/112817-Philippines-Infrastructure-FIL.pdf
257. Ibid.
258. Fitch Solutions. 2019. Railway Projects to Support Philippines’
Transport Sector Growth259. Milken Institute. 2017260. Climate Bonds Initiative. 2019. ASEAN Green Financial
Instruments Guide. https://www.climatebonds.net/system/
tdf/reports/asean_green_fin_istruments_cbi_012019_0.
pdf?file=1&type=node&id=35692
261. Government of the Philippines, PPP Center. 2019. https://ppp.
gov.ph/ppp_projects/mrt-11-project/262. Government of the Philippines, Department of Transportation.
2019. http://dotr.gov.ph/images/front/other_matters/nip.pdf
263. Government of the Philippines, Department of Transportation.
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264. Rappler. 2019. https://www.rappler.com/business/182519megawide-construction-proposed-east-west-railwaycost#:~:text=MANILA%2C%20Philippines%20%E2%80%93%20
Megawide%20Construction%20Corporation,17%20billion).
265. MSN. 2019. 56 flagship projects to be completed by 2022.
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266. Image. https://www.abrown.ph/news/megawide-buysdiliman-espana-railway-project/267. Image. https://www.esquiremag.ph/life/travel/publictransportation-network-manila-a00203-20180405
268. Government of the Philippines, PPP Center. 2019. https://ppp.
gov.ph/ppp_projects/east-west-rail-project/

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269. Business Inquirer. 2019. Andrew Tan proposes 2km Fort
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281. Government of the Philippines, Philippines Statistics Authority.
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282. Government of the Philippines, Philippines Statistics Authority.
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284. Government of the Philippines, NEDA. 2017. Philippine
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285. World Bank. 2018. Enhancing the Enabling Environment toPromote Private Sector Participation in the Implementation of
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289. Department of Public Works and Highways (DPWH). 2020.
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290. Asian Infrastructure Investment Bank (AIIB). 2020. AIIB and
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292. Business World. 2019. Fitch Solutions: Revived PPP focus to help
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294. Rappler. 2019. Lone bidder qualifies for P84 million Baggao
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296. ADB. Project list. https://www.adb.org/sites/default/files/
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297. Government of the Philippines, Metwropolitan Waterworks
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298. ADB. Philippines: Angat Water Transmission Improvement
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300. Philstar. 2019. ADB hikes Philippines lending program. https://www.philstar.com/business/2019/04/26/1912564/adb-hikesphilippines-lending-program-711-b
301. ADB. Project list. https://www.adb.org/projects/51294-002/main
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304. Government of the Philippines, PPP Center. Project Brief:
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305. Business Mirror. 2019. MWSS approves Wawa Bulk Water
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308. Business World. 2019. Wawa project to cost Razon P15-20
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310. Philstar. 2019. Governent Clears Razon Led Wawa
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311. Government of the Philippines: Proposed Targeted TechnicalSupport. https://www.thepmr.org/system/files/documents/
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312.Ibid.
313. Ibid.
314. Government of the Philippines. https://www.senate.gov.ph/publications/SEPO/AAG_Philippine%20Solid%20Wastes_Nov2017.pdf
315. Stratbase ADR Institute. 2019. Recycling for Mega-Manila.
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316. Government of the Philippines. https://www.senate.gov.ph/publications/SEPO/AAG_Philippine%20Solid%20Wastes_Nov2017.pdf
317. Ibid.
318. Stratbase ADR Institute. 2019. Revitalizing the Philippine
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319. Government of the Philippines, Environmetal Management
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320. Government of the Philippines, Environmetal Management
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321. https://www.lawphil.net/statutes/repacts/ra2001/
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325. Government of the Philippines, Environmental Management
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329. Business World. 2019. Waste-to-enery projects at LGUs seen as‘next wave’ by PPP Center. https://www.bworldonline.com/waste-toenergy-projects-at-lgus-seen-as-next-wave-by-ppp-center/
330. Bloomberg. 2020. https://www.bloomberg.com/news/
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332. Business World. 2019. Waste-to-enery projects at LGUs seen as‘next wave’ by PPP Center. https://www.bworldonline.com/waste-toenergy-projects-at-lgus-seen-as-next-wave-by-ppp-center/
333. Power Philippines. 2019. What’s the future of waste-to-energy
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335. Ibid.
336. Ibid.
337. Climate Bonds Initiative. 2018. Green Finance ASEAN
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414. SGS. Customer Story: DENR Becomes the First ISO 14001
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com/en/news/2016/12/denr-becomes-the-first-iso-14001-2015certified-public-agency-in-the-philippines
415. Government of the Philippines, SEC. 2018. ASEAN
Sustainability Bond Standard. https://www.sc.com.my/api/
documentms/download.ashx?id=3c4f768f-a290-4722-b9d1ef55942fbfde
416. Quacert. Prove your environmental commitment with ISO
14001 Certification. http://www.quacert.gov.vn/en/iso-14001.
iso254.html
417. UNFCCC. The Clean Development Mechanism. https://unfccc.
int/process-and-meetings/the-kyoto-protocol/mechanisms-underthe-kyoto-protocol/the-clean-development-mechanism
418. Government of the Philippines, DOE. Energy Management
System. https://www.doe.gov.ph/sites/default/files/pdf/
announcements/e-power_05_04_energy_management_system.pdf
419. UNFCCC. PoA: Methane recovery and combustion
with renewable energy generation from anaerobic aimal
manure management systems under the Land Bankof the Philippines’s Carbon Finance Support Facility.
https://cdm.unfccc.int/ProgrammeOfActivities/poa_
db/06GHFO2NC9MS3YWA7PDTQR8LKZVU14/viewCPAs
420. Sustainable Infrastructure Foundation. 2020. Briefing for theG-24. https://www.g24.org/wp-content/uploads/2019/07/SIFSOURCE-G24-brief-2019.pdf
421. Standard for Sustainable and Resilient Infrastructure(SuRe). Introduction to SuRe. https://cdn.website-editor.
net/225ce7f99bd0404d916e6ecefc0ae7d6/files/
uploaded/20190927_SuRe_Women_Infra_LZE-min.pdf
422. Institute for Sustainable Infrastructure. https://v3.sustainableinfrastructure.org/projects/map
423. Quarcet. ISO 50001, a framework to manage energy costs andcut greenhouse gas emissions. http://www.quacert.gov.vn/en/iso50001-energy-management-system-enms.iso259.html
424. https://www.climatebonds.net/standard/taxonomy
425. Government of the Philippines, PPP Center. 2020. Project
Brief: MRT-11 Project. https://ppp.gov.ph/ppp_projects/mrt-11project/426. Government of the Philippines, PPP Center. 2020. Project
Brief: East-West Rail Project. https://ppp.gov.ph/ppp_projects/eastwest-rail-project/57427. Government of the Philippines, NEDA. 2020. Revised Listof Infrastructure Flagship Projects. http://www.neda.gov.ph/
wp-content/uploads/2020/03/Revised-List-of-InfrastructureFlagship-Projects-as-of-2.17.2020.pdf
428. Government of the Philippines, PPP Center. 2020. Project
Brief: MRT Line 7. https://ppp.gov.ph/ppp_projects/mrt-line-7/429. Government of the Philippines, PPP Center. 2020. Project
Brief: Light Rail Transit Line No. 3 (MRT-3). https://ppp.gov.ph/ppp_projects/light-rail-transit-line-no-3-mrt-3/
430. Government of the Philippines, NEDA. 2020. Revised Listof Infrastructure Flagship Projects.http://www.neda.gov.ph/
wp-content/uploads/2020/03/Revised-List-of-InfrastructureFlagship-Projects-as-of-2.17.2020.pdf
431. Ibid.
432.Ibid.
433. Ibid.
434. Ibid.
435. Government of the Philippines, Philippines News Agency(PNA). 2019. DOTr gets NEDA-ICC nod for MRT-4 project. https://www.pna.gov.ph/articles/1089786
436. Government of the Philippines, NEDA. 2020. Revised Listof Infrastructure Flagship Projects.http://www.neda.gov.ph/
wp-content/uploads/2020/03/Revised-List-of-InfrastructureFlagship-Projects-as-of-2.17.2020.pdf
437. Ibid.
438. Government of the Philippines, PPP Center. 2020. Project
Brief: C5 MRT 10 Project. https://ppp.gov.ph/ppp_projects/c5-mrt10-project/439. Government of the Philippines, PPP Center. 2020. Project
Brief: Fort Bonifacio-Makati Skytrain Project. https://ppp.gov.ph/ppp_projects/fort-bonifacio-makati-skytrain-project/440. Government of the Philippines, PPP Center. 2020. Project
Brief: Davao People Mover. https://ppp.gov.ph/ppp_projects/davaopeople-mover/
441. Government of the Philippines, PPP Center. 2020. Project Brief:
Modified Light Rail Transit (LRT)-6 Project. https://ppp.gov.ph/ppp_projects/lrt-6-cavite-line-a/442. Government of the Philippines, NEDA. August 2020. List ofGreen Infrastructure Projects 2020
443. Government of the Philippines, PPP Center. 2020. Project
Brief: LRT Line 1 Cavite Extension and Operation and Maintenance.
https://ppp.gov.ph/ppp_projects/lrt-line-1-south-extension-andoperation-maintenance/?wppa-occur=1&wppa-cover=0&wppaalbum=89&wppa-photo=1208
444. Government of the Philippines, PPP Center. 2020. South
Integrated Transport System (ITS) Project. https://ppp.gov.ph/ppp_projects/integrated-transport-system-project-its-southwestterminal-project-2/
445. Government of the Philippines, PPP Center. 2020. Southwest
Integrated Transport System (ITS) Project (Parañaque Integrated
Terminal Exchange). https://ppp.gov.ph/ppp_projects/integratedtransport-system-project-its-southwest-terminal-project4/?wppa-occur=1&wppa-cover=0&wppa-album=88&wppaphoto=1218
446. Government of the Philippines, PPP Center. 2020. Project
Brief: Automatic Fare Collection System. https://ppp.gov.ph/ppp_
projects/automatic-fare-collection-system/?wppa-occur=1&wppacover=0&wppa-album=85&wppa-photo=1170
447. Government of the Philippines, PPP Center. 2020. Project
Brief: Angat Hydroelectric Power Plant (AHEPP) Project
Rehabilitation, Operation and Maintenance of Auxiliary #4 and#5. https://ppp.gov.ph/ppp_projects/angat-hydroelectric-powerplant-ahepp-project-rehabilitation-operation-and-maintenance-ofauxiliary-4-and-5/

58448. Government of the Philippines, PPP Center. 2020. Project
Brief: Bakun A/B and C Hydroelectric Power Plant. https://ppp.gov.
ph/ppp_projects/bakun-a-b-and-c-hydroelectric-power-plant/
449. Government of the Philippines, PPP Center. 2020. Project Brief:
Benguet Province Mini Hydroelectric Power Plant. https://ppp.gov.
ph/ppp_projects/benguet-province-mini-hydroelectric-power-plant/
450. Government of the Philippines, PPP Center. 2020. Project
Brief: Binga Hydroelectric Plant. https://ppp.gov.ph/ppp_projects/
binga-hydroelectric-plant/
451. BusinessWorld. 2018. FirstGen still keen on run-of-river hydroprojects.https://www.bworldonline.com/first-gen-still-keen-onrun-of-river-hydro-projects/
452. Government of the Philippines, PPP Center. 2020. Project
Brief: Leyte-Cebu Geothermal Power Plant. https://ppp.gov.ph/ppp_projects/leyte-cebu-geothermal-power-plant/
453. Government of the Philippines, PPP Center. 2020. Project Brief:
Leyte Luzon (Malitbog) Geothermal Power Plant. https://ppp.gov.ph/ppp_projects/leyte-luzon-malitbog-geothermal-power-plant/
454. Government of the Philippines, PPP Center. 2020. Project
Brief: Makban Binary Geothermal Plant. https://ppp.gov.ph/ppp_projects/makban-binary-geothermal-plant/
455. Government of the Philippines, PPP Center. 2020. Project
Brief: Mindanao Geothermal Plant. https://ppp.gov.ph/ppp_
projects/mindanao-i-geothermal-plant/
456. Ibid.
457. Power Technology. Burgos Wind Project, Ilocos Norte.
https://www.power-technology.com/projects/burgos-windproject-ilocos-norte/
458. BusinessWorld. 2019. PetroEnergy’s Palawan wind farm getsgo-signal from DOE. https://www.bworldonline.com/petroenergyspalawan-wind-farm-gets-go-signal-from-doe/459. Sunstar. 2016 Bangui Wind Farm. https://www.sunstar.com.
ph/article/56887/Lifestyle/Pea-Bangui-Wind-Farm460. UPC Renewables. Caparispisan. https://www.upcrenewables.
com/pf/caparispisan/; Renewables now. 2014. Philippine partners
bring to life 81-MW wind park. https://renewablesnow.com/news/
philippine-partners-bring-to-life-81-mw-wind-park-450042/
461. Clean Development Mechanism. Project 8235: San Lorenzo
Guimaras 54 MW Wind Power Project. https://cdm.unfccc.int/
Projects/DB/ERM-CVS1353317741.88/view
462. Government of the Philippines, NEDA. August 2020. List ofGreen Infrastructure Projects 2020.
463. Sunstar. 2019. Bacolod solar firm inks deal with Korean
partner. https://www.sunstar.com.ph/article/1822284
464. Business Inquirer. 2020. Ayala unit to build solar farms in
Zambales, Pampanga. https://business.inquirer.net/305614/ayalaunit-to-build-solar-farms-in-zambales-pampanga
465. Unlocking Solar Capital Asia. Top 25 Operational Solar PV
Plants in Southeast Asia. https://asia.unlockingsolarcapital.com/
top-25-solar-pv-plants-sea; PV Magazine. 2017. Philippines: 60
MW solar PV plant commissioned on Cebu Island. https://www.
pv-magazine.com/2017/07/28/philippines-60-mw-solar-pv-plantcommissioned-on-cebu-island/
466. Government of the Philippines, NEDA. August 2020. List ofGreen Infrastructure Projects 2020.
467. CBI interview with BIOPOWER. 2020. Email468. Ibid.
469. Ibid.
470. Government of the Philippines, PPP Center. 2020. Projet
Brief: Bulacan Bulk Water Supply Project.https://ppp.gov.ph/ppp_projects/bulacan-bulk-water-supply-project/471. Philippine News Agency. 2018. DPWH breaks ground on
P6.15-B flood-mitigation project in Pampanga. https://www.pna.gov.
ph/articles/1050487

472. Government of the Philippines, NEDA. August 2020. List ofGreen Infrastructure Projects 2020.
473. Government of the Philippines, NEDA. 2018. Pipeline programs
and project for ODA. https://www.neda.gov.ph/wp-content/
uploads/2018/10/Q3-2018-ODA-Pipeline-with-Status_clean.pdf
474. Government of the Philippines, PPP Center. 2020. Project Brief:
Clark Water Sewerage Project. https://ppp.gov.ph/ppp_projects/
clark-water-supply-and-sewerage-project/475. Government of the Philippines, PPP Center. 2020. Project
Brief: Subic Water and Sewerage Project. https://ppp.gov.ph/ppp_projects/subic-water-and-sewerage-project/476. Rappler. 2019. Lone bidder Baggao Water Supply Project.
https://www.rappler.com/business/199141-lone-bidder-baggaowater-supply-project-public-private-partnership477. Government of the Philippines, PPP Center. 2019. Summaryof PPP Project. https://ppp.gov.ph/wp-content/uploads/2019/04/
PPPC_REP-Projects-List-20190331.pdf
478. ADB. Philippines: Integrated Flood Risk Management Sector
Project. https://www.adb.org/projects/46362-002/main; New
Tap. 2018. Angat Water Transmission Improvement Project Metro
Manila, The Philippines. http://www.jwrc-net.or.jp/aswin/en/
newtap/report/NewTap_IWP08.pdf
479. Government of the Philippines, NEDA. 2019. Government
Flagship Infrastructure Project as of February 2019. http://www.
neda.gov.ph/wp-content/uploads/2019/04/InfrastructureFlagship-Projects-Matrix-ao-Feb-2019.pdf
480. Government of the Philippines, Philippine Information Agency.
2019. Chico River Pump Irrigation Project to open soon. https://pia.
gov.ph/news/articles/1023777
481. Government of the Philippines, National Irrigation
Administration. K2MMIP : The realization of a dream. http://
region12.nia.gov.ph/?q=content/k2mmip-realization-dream
482. Philstar. 2019. Razon to spend up to P 20 B for Wawa. https://www.philstar.com/business/2019/04/22/1911397/razon-spendp20-b-wawa
483. Government of the Philippines, Public-Private Partnerships
Center (PPPC). 2020. Project list and consultation with PPPC484. Ibid.
485. Ibid.
486. Ibid.
487. Ibid.
488. Ibid.
489. ADB. Philippines: Integrated Flood Risk Management Sector
Project. https://www.adb.org/projects/51294-002/main; ADB.
2020. Consultation with ADB.
490. Manila Times. 2019. Coca-cola to start building recycling
facility this year. https://www.manilatimes.net/2019/06/15/
business/green-business/coca-cola-to-start-building-recyclingfacility-this-year/569688/569688/
491. Government of the Philippines, DOE. https://www.doe.gov.
ph/energist/what%E2%80%99s-future-waste-energy-facilityphilippines
492. Government of the Philippines, NEDA. August 2020. List ofGreen Infrastructure Projects 2020.
493. Government of the Philippines, News Agency. 2019. https://www.pna.gov.ph/articles/1086206
494. IRI. Facilities. https://www.iri.com.ph/facilities.php
495. Government of the Philippines, NEDA. August 2020. List ofGreen Infrastructure Projects 2020.

Philippines GIIO Report Climate Bonds InitiativeClimate Bonds Taxonomy
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ENERGY

WATER

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