For banks that backed PH coal boom, the path to renewable energy comes with roadblocks

Banks in Asia and the Philippines are moving at a snail’s pace in defunding coal. At least 10 Philippine banks gave $841 million in loans and participated in $1.3 billion worth of underwriting activities involving at least five coal companies since the 2015 Paris climate agreement.

BY KAROL ILAGAN/Philippine Center for Investigative Journalism

In 2017, a network of more than 100 organizations filed a landmark climate complaint against the International Finance Corp. (IFC), the private sector arm of the World Bank. 

The Philippine Movement for Climate Justice (PMCJ) accused the IFC of contributing to the climate crisis as it had funded 19 coal power plants across the Philippines through a local bank, the Rizal Commercial Banking Corp. (RCBC), the ninth largest bank in the country in terms of assets.

IFC gave RCBC $253 million to invest in projects that could cause “significant adverse environmental and social risks that are diverse, irreversible or unprecedented,” according to the complaint filed before the World Bank Group in Washington. The IFC, whose funds are pooled from governments all over the world, was in effect violating its environmental and social standards.

Three years later, in September 2020, the IFC announced that it would no longer invest in banks that did not have a plan to divest from coal.

In October, the following month, RCBC also announced that it would no longer finance coal plants. RCBC became the first in the Philippines and only the fourth bank in Southeast Asia to phase out funding for fossil fuel. 

The IFC was initially defensive, recalled Ian Rivera, PMCJ’s national coordinator. Philippine bank managers claimed that getting the money back would be difficult because it was already spent, he said.

“If you claim that it has already been used in constructing the coal plants, then you should be accountable [for] that, particularly in the impacts,” said Rivera, who also represents communities adversely affected by coal operations.

The pronouncements signaled a bold move for financiers who have been backing the recent coal expansion in the Philippines, one of the most vulnerable countries to climate change. They also came at a time when the country’s energy department announced a moratorium on new coal plants. Monetary regulators also released guidelines on how banks could adopt a sustainable finance framework.

IFC and RCBC have joined the list of banks around the world – now more than 100 and counting – that have pledged to exit coal and realign their portfolios with the ambitions of the 2015 Paris climate agreement to cut greenhouse gas emissions and limit global warming. However, banks and coal companies in Asia, including the Philippines, are moving at a snail’s pace in adopting policies that would phase out fossil fuel and pave the way for a credible transition to renewable energy. Asia has the most number of new, operating and planned coal plants. 

Apart from RCBC and Bank of the Philippine Islands (BPI), which just last April announced plans to bring down its coal exposure by half in 2026 and to zero by 2037, no other local bank has followed suit or made public pronouncements. The momentum at the global level is high, but not so much at the local level. (PCIJ conducted an online search for other banks’ announcements on coal divestment, but did not find any so far.)

 Billions of dollars 

In fact, a 2020 study found that at least 15 Philippine banks had channeled a total of $13.42 billion to coal companies and coal projects in the Philippines from 2009 to 2019. More recent data from the German-based non-profit Urgewald showed that at least 10 Philippine banks gave $841 million in loans and participated in $1.3 billion worth of underwriting activities involving at least five coal companies since the Paris agreement.

Moreover, as of writing, banks have yet to submit their transition plans, as required six months after the release of the Bangko Sentral ng Pilipinas (BSP)’s Circular No. 1085 or the Sustainable Finance Framework.

Issued in April 2020, Circular No. 1085 outlines steps in mainstreaming sustainability principles in the financial sector. While it does not explicitly mention coal, the framework adopts the United Nations Environment Program’s full spectrum of sustainability, which includes climate and green finance.

The issuance of the circular is timely, said the BSP, as the impact of the pandemic covers Environmental, Social and Governance (ESG) issues that are all high on the country’s Sustainable Development Goals (SDGs), a set of global goals to eradicate extreme poverty and achieve sustainable development by 2030.

Rivera recalled that when the circular was unveiled in April 2020, some banks held back and asked the central bank to go slow because of the losses they had incurred amid the pandemic.

The issuance of the circular is a welcome development, but how it will be implemented is another thing, he said. “By the end of three years, banks should be transparent about their investments involving environment and social risks. That should be made public and also to guide their depositors and stockholders,” he said.

In an email to PCIJ, the BSP clarified that banks must submit transition plans upon the request of the central bank’s supervising department. Because of the pandemic, the BSP said it would be flexible as regards the submission of the plan. 

The BSP also said it was helping banks adopt sustainability principles. The central bank’s initiatives include webinars that allow “first-mover” banks to share their experiences in Environmental and Social Risk Management (ESRM), sustainability reporting requirements, and the issuance of green, social or sustainability bonds.

Lyn Javier, managing director of the Supervisory Policy Sub-Sector under the BSP’s Financial Supervision Sector, said the central bank was cognizant that banks were in various stages of awareness and capability in managing financial risks arising from climate change.

This was the reason why the circular gave banks a transitory period of three years to make the necessary adjustments, considering that the change won’t happen overnight, she said. Key to this transition is the bank’s plan on how it will comply with standards, including the assessment of its loan portfolio. 

The circular also emphasizes the role of the board of directors in the adoption of sustainability principles as well as in promoting a culture that fosters environmentally and socially responsible business decisions. 

“As banks embrace sustainability principles, the tone that will be set by the board of directors and senior management will then reflect into the bank’s strategic objectives and risk appetite, including in business decisions on which projects to invest in or finance,” said the BSP.

In an email to PCIJ, BPI said it had prepared a transition plan to comply with the BSP’s sustainable finance circular. BPI also said it had established the BPI Group Sustainability Agenda Policy, which will guide the bank in integrating sustainability principles in its corporate governance, risk management, strategic objectives, and operations.

PCIJ sent requests for interviews and comments to the Bankers’ Association of the Philippines (BAP), BDO Unibank, the country’s biggest bank, and Metrobank. Metrobank, the third largest bank in the country in terms of assets, acknowledged PCIJ’s request and said it would answer PCIJ’s queries. The BAP said it was unable to grant an interview. 

 Can a bank be “sustainable” if it still funds coal? 

Several banks even prior to the issuance of the circular have supported the sustainable finance agenda by taking on initiatives in line with the UN’s SDGs. Major banks have issued sustainability and green bonds and financed renewable energy projects.

The Bank of the Philippine Islands (BPI), for instance, issued the country’s first dollar-denominated Asean green bonds in September 2019. According to BPI, the fourth largest bank in the country, net proceeds of the bond sale would be used to finance or refinance eligible green projects, as described in BPI’s Green Finance Framework, developed four months earlier.

As of 2020, BPI has disbursed a cumulative of P130 billion toward 89 renewable energy projects, P29 billion toward 158 energy efficiency projects, and P32 billion toward 107 climate resilience projects. 

Banks like BDO Unibank and Unionbank have also released their own sustainable finance frameworks, which exclude fossil-fuel power generation or transmission from the use of proceeds of their green or sustainability bonds.

These efforts are also all in line with sustainability reporting requirements set by the Securities and Exchange Commission.

But the Center for Energy, Ecology and Development (CEED) said banks should not lump climate and sustainability policies together.

“When we talk about climate guidelines – which is about the Paris agreement – the question is what concrete steps banks are taking to align their investments towards limiting global temperature rise to 1.5° Celsius by the end of the century,” says Gerry Arances, CEED executive director.

“If there is no position or plan on phasing out coal or even a public pronouncement at that, it would be difficult to say that a bank is a ‘sustainable’ bank,” he added.

At the global level, more and more banks are announcing that they will withdraw investments from coal-producing utilities. But activists continue to criticize the financial sector for being slow to act, highlighting how the world’s biggest banks have since continued bankrolling fossil-fuel producers since the Paris climate agreement was ratified in 2015.

The use of coal is the single biggest source of harmful greenhouse gas emissions that induce the worsening climate crisis. Communities hosting coal plants have also been documented to suffer from air, water and land pollution.

 Scorecard tracks new coal commitments 

The Withdraw From Coal Campaign’s April 2021 Coal Divestment Scorecard shows that while banks have garnered better scores on climate action, their coal financing activities have pulled their scores down.

The scorecard is a coal exposure and policy assessment tool developed by environmental groups to help banks rethink their coal financing activities and assess the risks involved. It is the only one of its kind in the developing world. CEED is among the proponents of the campaign. 

The first Coal Divestment Criteria and Scorecard in May 2020 identified at least 15 banks that channelled a total of $13.42 billion to coal companies and coal projects in the Philippines from 2009 to 2019. These banks have either financed projects for power plants, mines, and infrastructure; underwrote coal companies’ various debt issuances; raised capital for coal companies; or directly invested and managed coal assets.

According to the more recent April 2021 issue, BPI remains the country’s top coal financier, having committed to underwrite a bond issuance for AboitizPower Corp., the second largest coal developer in the Philippines. BPI has committed to underwrite over P1 billion of AboitizPower’s new corporate retail bonds to be used to redeem 2014 bonds that were utilized to fund coal plants in Pagbilao, Cebu, and Davao. In total, BPI has funded 15 coal plant projects and six coal developer companies.

BPI clarified that the bank did underwrite AboitizPower bonds whose proceeds were used to redeem the 2014 bonds. The 2014 bonds, the bank said, were used to fund several power plants, including hydropower plants in Manolo Fortich, Bukidnon and Sabangan, Mt. Province.

Moreover, according to the study, BDO, China Bank, and Metrobank had joined BPI as joint issue managers, joint lead underwriters and joint bookrunners for AboitizPower’s newly registered bonds. 

The Philippine National Bank (PNB) and BDO retained their ranks as the second and third largest coal financiers in the country. PNB financed nine coal plants, while BDO, the largest bank in the country, financed at least 14 coal plants. The study found that both banks frequently acted as the mandated lead arrangers and lead issuers for a combined 33 deals. 

Due to its new coal exposure, China Bank rose five ranks to become the sixth top coal financier in the country, the study found.

CLICK to read the Withdraw From Coal Campaign’s April 2021 Coal Divestment Scorecard.

The scorecard uses data from the following sources to determine the contributions of Philippine banks to the coal industry: Thomson Reuters Project Finance International; Final Prospectuses and Offer Supplements for the Issuance of Financial Instruments; Philippine Dealing System Holdings (PDS) Group; Urgewald Coal Financiers Database; and the Global Energy Monitor.

The published scorecard does not include a breakdown of each bank’s coal exposure. A check with the finance data of the Global Coal Exit List (GCEL) 2020, published by German-based non-profit Urgewald, showed that at least 10 Philippine banks gave $841 million in loans and participated in $1.3 billion worth of underwriting activities involving at least five coal companies. (Check out the list of coal companies that are on the Global Coal Exit List 2020.)

The study, published in February 2021, showed that 4,488 institutional investors held investments totaling $1.03 trillion in companies operating along the thermal coal value chain. Urgewald data cover two years, from October 2018 – when leading climate scientists recommended limiting global warming to 1.5° Celsius – until October 2020.

CLICK for a list of Philippine coal companies and coal plants on the Global Coal Exit List 2020.

Vested relationships, interlocking investments 

PCIJ did not find publicly available information on banks’ coal investments vis-a-vis its total portfolio. The BSP does not collect such information. Sustainability reports that banks submit to the SEC include some information on their power generation loan mix but not in comparison with their total portfolios.

BPI’s energy generation portfolio, for instance, is broken down as follows: 45% renewable energy, 45% coal and diesel, and 10% gas.

What is reported to the BSP is a summary of outstanding loans to various sectors in production and housing consumption. The sector “Electricity, Gas, Steam and Air-Conditioning Supply,” according to the BSP, includes both coal-based power generation as well as renewable energy and other energy efficiency projects. 

According to BSP data as of March 2021, Philippine banks granted a total of P1.06 trillion to the sector, representing a tenth of the total outstanding loans given by the entire banking system. The share for coal projects should be lower as the figure included other energy projects. The percentage differed for each bank as they had varying exposures to coal.

Finance experts also estimated the figures to be minimal. Lawyer Antonio La Viña said coal investments were so small percentage-wise, which would make it reasonable for banks to let them go, said. La Viña is the executive director of the Manila Observatory, which is also part of the Withdraw From Coal Campaign.

A finance expert, who heads a regional policy think-tank, said coal investments by at least two major banks in the region accounted for under 2 percent of their respective portfolios. The argument put forward by these banks, he said, was the reverse — that they should be given a pass for such small exposure to coal.

In Arances’ view, banks already have internal policies in support of sustainable finance but it would be difficult for them to defund coal because many of these ventures are owned by conglomerates such as San Miguel Corp. and AboitizPower, which are major clients. Many Philippine banks are themselves part of large conglomerates.

“Ang dami na nilang investments na mahihirapan ang isang bangko (They have so many investments, making it hard for one bank). We understand that because it will shake up their whole investment portfolio. So that’s the thing here. Kaya hirap na hirap talaga sila (That’s why it’s so difficult for them).”

For La Vina, it’s all about relationships that banks don’t want to let go. The former environment undersecretary also mentioned the Aboitizes who own Aboitiz Power and Ramon Ang of San Miguel Corp. Aboitiz and San Miguel are the country’s biggest power suppliers.

“For me, it’s more about the vested relationships rather than the real economic value of all of these assets,” he says. “[It’s about] interlocking investments, relationships that they wouldn’t want to let go, or they are afraid that if they stop funding these people for coal they’ll also go somewhere else for other things.”

BPI said it evaluates all financing proposals on the basis of the merits of the project, including financial viability, credit metrics and sponsor support. Projects sponsored by large corporates with strong balance sheets have done well in the past based on credit performance, the bank said.

Large conglomerates with diversified energy portfolios have also put in place their respective ESG frameworks which incorporate, among others, initiatives to pursue more renewable energy projects. These developments are incorporated in BPI’s credit assessment, the bank said.

Ayala Corp., a major coal developer in the Philippines, for instance, announced in April 2020 that it would fully divest from coal by 2030.


Southeast Asia is ‘stuck’

A finance expert, who works with financial institutions and regulators in the region, said the big question was how to help banks in the transition, as project lending is not like a tap that can just be turned on or off. 

“A lot of these projects form part of a blueprint and that blueprint has existed for a long time ago and fits with public components,” he said.

It’s also about a credible transition to renewable energy. “Transitioning cannot mean that you say, ‘We need time because the economy is not ready so we’ll take the time to transition.’ It means that you have a serious target,” he said.

The expert sees at least three stumbling blocks: fitting renewable power supply into the power transmission grid, energy security, and political considerations especially between trading partners.

CEED’s Arances backed the expert’s observations, saying the electric grid in the Philippines needed to be developed to match the requirements of renewable energy. A smart grid that can absorb as much intermittent electricity as possible was needed, he said.

“The reality is Southeast Asia is actually stuck if coal consumption in Asean is going to increase,” the finance expert said. Projections from a 2014 study by the Asian Development Bank (ADB) showed that while Southeast Asia would increase its renewable generation share by 8% to 27%, it would also increase its share of coal from 36% to 42% by 2030. 

According to the ADB paper, the Philippines is also expected to become the most coal-dependent country in Southeast Asia in 12 years or by 2026.

The current draft of the Philippine Energy Plan (2018-2040) also projects a significant share of coal in the energy mix at 58.9% by the end of the decade. Back in 2014, coal had a 43% share in power generation.

These estimates do not yet take into account the recent moratorium placed by the Department of Energy (DOE) on new coal applications. The moratorium however does not apply to at least 22 proposed coal plants approved for construction.

But the ADB study did find that the growth of renewable energy use in the Philippines would outpace that of coal use, at 151% between 2014 to 2030 against 75% for coal during the same period.


 Road to renewable 

Not all is bleak, however. Sources interviewed for this story all said that bringing the share of coal down was possible because technology and economic variables had improved for renewables.

The status quo is changing and previous arguments against renewable energy no longer apply. Cost and efficiency for both solar and wind have improved significantly, with prices going down by as much as 60 percent in the last 15 years. Technology has thus made it feasible for more people to adopt renewables.

Bankability, profitability and affordability are all part of the equation, said Arances. Coal is only deemed the cheapest source of electricity because of the current system. Bid requirements for power supply agreements, for instance, are set so high in terms of wattage, making it hard for renewable energy companies to qualify. 

The lay of the land in the power sector needs to shift out of coal’s favor first and foremost, according to experts. Key to this shift is the Renewable Energy Act, which was passed in 2008 but whose implementation has been delayed.

In fact, in the same year when PMCJ filed the IFC case, the network also filed a mandamus before the Supreme Court against the DOE, claiming that the department did not draw up renewable energy regulations.

Rivera took note of the issuance of the rules for Renewable Portfolio Standards, establishment of the Green Energy Options Program, and reduction of dependence on fossil fuels.

The Green Energy Options Program, for instance, allows consumers to generate their own electricity and encourages utility companies to offer options to consumers who want their electricity to come from renewable energy.

“Hindi nila nilagyan ng provisions kaya natengga ‘yan for more than 10 years (They did not put provisions in place so it was delayed for more than 10 years),” he said.

PMCJ’s case was brought to the Court of Appeals, which ruled in favor of the complaint. The DOE was ordered to draft implementing rules and regulations in 2019.

The problem is systemic, said Greenpeace Campaigner Khevin Yu. Since the energy system is  privatized, all the government can do is to make plans and dangle incentives, which have yet to be implemented since the Renewable Energy Act is still not in full effect. This is one of the major barriers for power companies in tapping renewable energy, he said.

BPI said DOE’s moratorium on the approval of new coal projects was a good start. Different government agencies may consider providing different forms of incentives to boost renewable energy, energy efficiency and even green building portfolios, it said.

Since the passage of the Renewable Energy Act in 2008, the country’s renewable energy mix has remained at about 30% a decade later, with at least 45 more coal projects still in the pipeline. Instead of developing solar power, coal power plants were built.

“What happened was so ironic. Rather than going through a clean renewable energy transition, a dirty energy transition took place,” Yu says.

Greenpeace is now running a campaign to push Meralco, the largest distribution utility in the Philippines, and its power generation subsidiary MGen Power, to move away from coal. In its recent report titled Decarbonizing Meralco, Greenpeace said Meralco relied heavily on dirty power sources, with fossil gas taking up 61% of the company’s energy mix; coal, 27%; and oil, 10%. Renewable energy accounted for a meager 2.6%. The latest data on the company’s current and future power supply agreements showed that fossil fuels would remain dominant at 94% of the mix, with the share of renewables going up by only 6%.

If Meralco moves, it will be a huge game changer for energy transition, according to renewable energy advocates. The pandemic and ensuing lockdowns have exposed the problems of the country’s overreliance on coal as a source of energy. Consumers experienced the controversial “bill shock” last year, which Rivera and Yu said was partly because  consumers paid for the cost of oversupply that could not be utilized by industries during  the lockdown.

The Philippines imports at least 75% of its coal from Indonesia, Australia, China and Vietnam. The rest of the country’s energy needs are covered by a mix of local energy generators, including coal plants funded by banks.

“If we have renewable energy, we can produce energy here and not import and prevent price fluctuations,” says Yu. “Electric consumers will be much happier than now when every month electricity rates are just going up.”

*This report was written and produced as part of a media skills development program delivered by the Thomson Reuters Foundation. The content is the sole responsibility of the author and the PCIJ.

Dirty Duterte admin: More coal energy than ever

by IBON Media & Communications

In his address to the United Nations General Assembly in September, Pres. Rodrigo Duterte called on all signatories of the Paris Agreement to do their part in reducing carbon emissions. He said that he will consider declaring a “climate emergency” because mitigating the effects of climate change is a priority. Meanwhile, Congress is deliberating on a higher proposed budget for renewable energy.

This is a seeming turnaround from the president’s 2016 declaration that the Philippines will not honor commitments under the Paris climate change deal. But maybe not – the country’s increasing reliance on coal betrays the Duterte administration’s green turn as mere posturing. The government is maintaining the country’s high dependence on coal. This puts into doubt whether it is genuinely concerned about the Philippine environment and declaring a climate emergency. A higher proposed budget for renewable energy also does not necessarily indicate seriousness towards greener energy.

Using more coal than ever

A real shift to renewable energy will help the country phase out of relying on coal and fossil fuels. But the heavy and mounting use of coal shows that the government is not really keen on this. The highly privatized power sector is predictably choosing to source energy where it is most profitable for it.

Energy supply in the Philippines is still primarily sourced from fossil fuels. Non-renewable oil and coal made up 61% of energy sources in 2018, while the rest were renewable sources including geothermal and biomass. Oil is largely used for transportation and commercial purposes. The industry and electricity sectors meanwhile rely heavily on coal which takes up 32% and 31.5% of 2018 energy consumption, respectively.

The government is increasingly reliant on coal for power generation. Department of Energy (DOE) data shows that, under the Duterte administration, power generated from coal rose from 43,303 gigawatt hours (Gwh) in 2016 to 57,890 Gwh which is over half of total power generated (106,041 Gwh) in 2019. Only 22,044 Gwh of power was generated from renewable energy.

In its study “The State of the Philippine Environment”, IBON noted that 11 of the 49 committed power projects across the country are coal-fired power plants and account for 78% of the projects’ combined rated capacity of 6,280 megawatts (MW). Out of 345 indicative power projects, 18 are coal-fired accounting for 28% of the rated capacity.

The Philippines is also increasing coal imports. Imported coal made up 13.1% of the primary energy supply mix in 2016, 15.8% in 2017, and 17% in 2018; the share of indigenous coal as well as renewable energy correspondingly decreased . Coal self-sufficiency fell from 45.2% to 37.9% over the same period.

IBON also stressed that coal is cheap but hazardous to the environment and the people. Yet, the country continues to receive imported fossil fuels, technology, and foreign investment. Some of these have been rejected or banned in their countries of origin due to environmental concerns. As a result, greenhouse gas (GHG) emissions in the Philippines increased by 425% annually from 1990 to 2016, mostly coming from power generation. Coal was responsible for half of the GHG emissions.

Serious about renewables?

Clearly, getting rid of the Philippines’ coal dependence will be a concrete step towards embracing sustainable energy. Environment-friendly sourcing of energy is possible through community-based, people-determined solar, air and water energy generators.

In the proposed 2021 budget for the DOE, the Renewable Energy Development Program gets a higher allocation at Php117.9 million from Php112.5 million last year. However, Philippine governments’ push for renewable energy – specifically geothermal, biomass, hydropower and biofuels, can actually harm the environment, IBON’s study bares.

The construction of geothermal plants destroys forest cover and disturbs the natural habitat. For example, in the Southern Negros geothermal area, trees near the well sites shed their leaves due to emissions of sulfur oxide.

Hydropower generation through large dams is meanwhile pursued to attract foreign direct investments. However, the large impounding areas common with such projects submerge the lands where they are built, disrupt the natural ecology of river systems, and displaces communities in inundated areas. They also cause sedimentation which eventually weakens power and water generation capacity.

The construction of the Kaliwa and Laiban dams, for instance, will displace over 6,000 households and flood barangays in Tanay, Rizal and General Nakar, Quezon, mainly where the Dumagat and Remontado indigenous people live. Agricultural, forest, and wildlife areas inside the Kaliwa Watershed Forest Reserve will also be flooded.

The Biofuels Act of 2007 aims to encourage investment in locally produced biofuels. This however diverts attention and scarce resources from food production and supply. Biofuel farms also usually involve the use of large amounts of fresh water, synthetic fertilizers, pesticides and herbicides, and fossil fuel, in agrichemical monocropping.

If the government is sincere about declaring a “climate emergency” and protecting the Philippine environment, it needs to give more value to the environment and to people’s needs over the profits of energy businesses. If it does so, then it can pursue more sustainable options in sourcing and distributing energy across residential, commercial and industrial sectors. #

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Kodao publishes IBON articles as part of a content-sharing agreement.

Groups deny benefits from coal plants


BAGUIO CITY — Environmental groups in Ilocos rebuked the claims of economic benefits by coal-fired power plant proponents. The Ilocos Network for the Environment (Defend Ilocos) and Save Sual Movement (SSM), in a separate statement, argued that health and environmental cost out weights the promise of jobs and royalties from the coal-fired plants.

Two companies are set to build to coal-fired power plant in the region. The P80-Billion 670 megawatt twin-plant of Global Luzon Energy Development Corporation (GLEDC) in Luna, La Union and the P47-Billion 1,000 MW plant of South Korean energy giant Korean Electric Power Corporation (KEPCO).

Both organizations believe that residents, and the neighboring towns will be at the losing end of these projects.

Temporary benefits

Rosanna Marie Soriano, president of SSM said that KEPCO only presented “half truth” about its projects impact when it announced that it will create 5000 jobs during construction and collect about P800 million in real-property tax annually.

Her group explained that while the construction of the plant will require a considerable number of labor force, it will eventually “trim down to a few hundred skilled worker and office personnel.”

The same tactic was utilized by GLEDC and Mayor Vic Marron of Luna town. They flaunted to the media and the public the need for at least 3,000 workers and the P500-million in real property tax if the project proceeds.

For Defend Ilocos, its just routine for companies investing in coal-fired plants “to highlight the economic benefits” and “use of emission-reducing technology” but in the long term operation “this will entail heavier environmental and social cost.” The environmental network said that the plant which GLEDC and KEPCO intend to build are for big businesses and not for the local residents.

Mayor Roberto Arcinue explained that the Pangaisnan, the municipality of Sual and Barangay Baquioen will be share the revenue with each receiving 35%, 40% 25% respectively.

He also claimed in the past that revenue from the existing plant made Sual into a first class municipality. The town is the location of the 1,200 MW coal-fired plant, the country’s biggest in the country, operated by Team Energy. It started providing service in 1999 and full power capacity was delivered in 2007.

However, revenue seems to play a minimal role in the overall poverty situation in the area. In 2012, Sual ranked 8th among the municipalities generating locally sourced revenues. But she was also identified by the Provincial Poverty Reduction Action Team as one of the 10 municipalities with the highest poverty incidence.


GLEDC and KEPCO have boasted that their plant will run with the latest technology. Both local governments of Sual and Luna also claimed that the plants will be “environmentally-friendly.”

However, the groups are not convinced.

Defend Ilocos explained that “decades of utilizing coal for power generation across the globe have proven its detrimental impacts to our health and environment.” The group also pointed that “low-emission coal power facilities fail to address the overall impact of the coal industry from extraction, transport, stockpiling and waste disposal.”

It added that countries touted to have the most efficient coal fleet like Japan, China, and the United States failed to curbed the environmental and health issues associated with coal and coal-fired plants.

Soriano’s group, in its statement, mentioned a study by Dr. Romeo Quino of the University of the Philippines College of Medicine in KEPCO’s 200 MW coal-powered energy facility in Naga, Cebu. The doctor was able to identify heavy metals like mercury, lead, cadmium and arcenic in high concentrations from coal ash samples taken from the area. Residents in the place complained of of air, water and land pollution prompting even the Asian Development Bank, who funded the project to admit the said problems.

“Humihingi kami noon ng report mula sa LGU at sa planta kaugnay sa epekto nito sa environment pero wala naman silang ibinigay sa amin,” Soriano said. To bolster their proof, SMM will undertake water and air testing on March 31 to April 2 in the vicinity of the existing plant.

An independent consultant and researcher, Dr. Freddie Obligacion, in his published study in 2015 of 410 households from four major coal-powered plants found that “major coal-fueled plants in the country have adversely impacted our fellow citizens’ environment, health, livelihood, and life satisfaction.”

Health was the major impact area cited in the study. According to the document, fewer illness were experienced by the residents prior to the operation of the facilities. However, after the plants started operation, reports of respiratory and cardiovascular diseases, skin allergies, infections, headaches and diarrhea became common. Of the respondents who encountered these diseases, 69% attributed it to the presence of the coal-fired power plant in their community.

No direct consumption

“Wala namang isang bahay dito na directly sa coal plant kumukuha ng kuryente, huwag niya (Arcinue) sabihin na kami ang pangunahing nakikinabang dahil dumadaan naman ito sa grid, its not only the coal plant that supplies the energy we use. Maganda sana kung diretly at libre ang kuryente pero hindi naman. Binabayaran nga namin yan. Kapag tumataas ang kuryente ay tumataas din ang sa amin kahit pa nandito ang biggest coal plant,” explianed Soriano.

The statement was her reaction to Arcinue’s foolish call to for SMM members to “refrain from using electricity produced by the power plant” to prove their sincerity in opposing KEPCO’s facility.

In 2015, Pangasinan was reported to having the highest electricity rate in Region 1 with a price tag of P17.7595 per kwh.


Soriano said that her group are experiencing harassment from the local chief executive. While she claims to have not experience direct attacks, her family and colleagues are being singled-out.

“Yung mga kasamahan ko ang nakakaranas, lalo na yung mga nasa wharf area. Palaging sumusulat ang iba’t ibang office ng munisipyo, ang MENRO, Engineering Office at sinasabing dapat umalis sila. Pero ang pinapaalis lamang ay yung mga sumasapi sa amin samaantalang mga allies nila ay hindi naman pinapaalis,” the SSM leader narrated.

She added that even her family are threatened through their businesses.

“Marami siyang (Arcinue) sinisita na kung ano-anong violations namin, na we are not in compliance of somethings, gaya ng building code,” she said.

Like Soriano and her group, members of Defend Ilocos also experience harassment. The group said that its network TIMEK La Union, a fisherfolk organization that is opposing the construction the coal-fired plant in Luna are being monitored by the local police.

“In November 2017, PNP personnel went looking for TIMEK officers and members in Agoo and Bauang, and told the barangay officials that it is a front organization of the New People’s army,” stated the group in its year-end report.

Clean development

“Everybody desires progress, but let us have it in the proper, clean, safe and sustainable way… not with coal that will endanger our lives, our family and the future generations of Sual,” noted SMM in its statement.

Defend Ilocos on the other hand is pushing for the prioritization of “ industrial and service sector investments with less ecological impacts” to create jobs. The group also said that local governtments are “better off promoting rural development by pursuing genuine agrarian reform to strengthen agriculture and the fishery sector.” #

No to Coal in Bohol

We, the Bohol Clean Energy Advocates, call on the Sanggunian Panlungsod of Tagbilaran City and the Sangguniang Panlalawigan of Bohol to recognize the negative impacts of coal-based power generation and the need to shift to renewable energy sources by passing resolutions to support calls for “a moratorium on the establishment of carbon-intensive and fossil-based technologies”; and interpose its objection on any proposed coal-fired project within our province;

WE ALSO URGE on the Office of the Secretary of the Department of Environment and Natural Resources and the Office of the Secretary of the Department of Energy to deny any applications for coal-fired and other fossil-based power plants within Bohol; and implement the mandate for the development and use of renewable, sustainable energy sources and technologies.

We urge the Bohol Energy Development Advisory Group (BEDAG) and the Officials of the Provincial Government of Bohol to faithfully and strongly enforce the Vision and Mission of the province as “a prime eco-cultural destination and a strong, balanced agro-industrial province, with a well-educated, God-loving and law-abiding citizenry, proud of their cultural heritage, enjoying a state of well-being and committed to sound environmental management”, through “good governance and effective partnerships with stakeholders”; as well as the declaration of our province as an Eco-Cultural Tourism Zone under Republic Act No. 9446 that mandates us to “protect and enhance the natural features and cultural heritage of the tourism zone, while providing sustainable economic opportunities for the local community”.

Why is this important?

Alarmed that there are sectors in the Provincial Government along with investors and power providers who are poised to endorse a backward idea of a coal-fired power plant in the island, we demand that our leaders to lead us in achieving Bohol’s Goals that include, among others, Environmental Protection and Management; and, Responsive, transparent and accountable governance.

Drawing from our earlier manifesto, we echo the call, this time, taking a firm stand against whatever plans and machinations there might be to utilize coal in generating power within our province. We have united behind the following arguments:

1. THAT COAL IS DIRTY AND DEADLY. Coal damages both people and planet. Existing and proposed coal power plants in the Philippines can cause up to 2,410 premature deaths annually according to a 2015 Harvard study. Coal burning emits substances which contribute to smog, haze, lung disease, and respiratory illnesses; as well as neurological and developmental damage in humans and other animals (US Energy Information Administration, 2017). Coal mining contributes to soil erosion, water pollution and loss of biodiversity. It is directly linked with climate change as it is responsible for 46% of carbon dioxide emissions worldwide, inducing natural disasters.

2. THAT COAL IS COSTLY. While there is still a popular perception that coal is sold cheaply, a research by the International Institute for Sustainable Development (IISD) revealed that coal use actually brings with it additional costs that are not traditionally taken into account such as: (1) Subsidies to coal producers; (2) Air pollution estimated to cause more than 6,000 global deaths annually; and, (3) Greenhouse Gas emissions that undermine targets under the Paris Agreement on Climate. If we monetize these impacts the total cost of coal is estimated to be around USD 11 cents per kilowatt hour (kWh), more than double the cost of competing renewable energy based on recent renewable auction results.

3. THAT GLOBALLY COAL IS NO LONGER A VIABLE OPTION. The recent falls in solar Photo Voltaic prices have led India to cancel new coal capacity, in addition to rising concern about the impacts of coal use on air pollution. In China, this concern led to a moratorium on new coal plants in 28 out of 31 provinces. With the tide turning against coal across the world, there is real concern that investments made today could soon be impossible to operate on environmental, public health and cost grounds, leaving a legacy of stranded power stations as the last monuments to the age of coal. (IISD, 2017)

WE REJECT the proposal or plan of private or government investors in establishing a coal-power plant in the province of Bohol because it is tantamount to a violation of the existing laws and commitment for the Boholano people;

WE DECLARE that renewable energy is the way forward. A 2013 World Wide Fund for Nature (WWF) report said that in 2011, at least 384 renewable energy service contracts were awaiting approval from the Department of Energy, equalling to 6,046 MW of generation capacity. Currently, there are 13 operational coal-fired power plants with a combined installed capacity of 4.937 MW;

WE STRONGLY SUPPORT the development of renewable energy sources as the way forward for our beloved Bohol that claims to have ecological and cultural tourism as its main path for sustainable development being one of its primary economic drivers.

WE ENJOIN our fellow Boholanos and residents to join us in this worthy cause to save our environment from this threat of destruction for our sake and the future generation.

WE DEMAND as citizens and voters that the Sanggunian Panlungsod of Tagbilaran City and the Sangguniang Panlalawigan of Bohol shall recognize the negative impact of coal-based power generation and the need to shift to renewable energy sources by passing Resolutions to support calls for “a moratorium on the establishment of carbon-intensive and fossil-based technologies”; and interpose its objection on any proposed coal-fired project within our province;

WE ALSO URGE on the Office of the Secretary of the Department of Environment and Natural Resources and the Office of the Secretary of the Department of Energy to deny any applications for coal-fired and other fossil-based power plants within Bohol; and implement the mandate for the development and use of renewable, sustainable energy sources and technologies.