THE World Bank said it has approved an $800 million development policy loan to support the Philippines’ efforts to accelerate its energy transition and boost climate resilience.
In a statement on Wednesday, the World Bank said the First Energy Transition and Climate Resilience Development Policy Loan will support the Philippine government’s reforms to scale up adoption of clean energy technologies; increase the security, flexibility and competition of electricity markets and improve water management across water uses.
It is expected to increase the share of renewable energy in installed generation capacity to 42 percent by 2027 from 30 percent in 2023; support the procurement of 1,000 megawatts of new offshore wind capacity; and implement energy efficiency measures saving 5 gigawatt hours annually.
Electrification of public sector vehicles and improved electricity market reforms will further decarbonize the grid, the Washington-based institution said.
By strengthening renewable markets and unlocking private sector investments, the program will contribute to scalable, transformative impact beyond 2030, placing the Philippines on a sustainable trajectory, it said.
The operation is also seen helping improve governance and cohesiveness in the water sector by introducing policy reforms for water resources management and water supply and sanitation by promoting better coordination between national and local governments.
Energy efficiency
“Focusing on renewable energy (RE) sources and using energy more efficiently can help the country reduce electricity costs, improve energy security and cut down on pollution,” Zafer Mustafaoğlu, World Bank division director for the Philippines, Malaysia and Brunei, said in the statement.
“Using more affordable renewable energy in the energy and transport sectors is crucial for the Philippines to build a strong economy,” he added.
“To accelerate energy transition and keep electricity affordable for all Filipinos, the Philippines needs reforms to ensure achieving the government’s renewable energy and energy efficiency targets, improving grid capacity and flexibility and enhancing competition in electricity markets,” Feng Liu, World Bank senior energy specialist and Task Team Leader of the operation, said in the same statement.
“These reforms can help lower power supply cost and improve the reliability and resilience of the power system, thereby making electricity more affordable and reliable for Filipino households and businesses,” Liu added.
The World Bank said this development policy operation is a rapidly disbursing financial support provided to help member countries address development financing needs through a program of policy and institutional actions.
Terms of the loan were not disclosed.
