By Vincent Mariel P. Galang
MOST developers may think that turning their buildings “green” would be expensive, without seeing the long-term benefits for their business and society as a whole.
Since its launch in 2008, Bank of the Philippine Islands (BPI), through its Sustainable Energy Finance (SEF) Program, has helped over 300 companies, including property developers, pursue more environment-friendly but cost-efficient projects.
As of end of 2018, the program has disbursed P52.6 billion for energy efficiency, renewable energy, and climate resiliency projects. Of this, 20% of the funds were allocated for Green Building projects.
“The green building initiatives of the private sector were triggered by the law because we have a very important business consideration as different project owners build or construct new buildings, we say if you do not comply with the law, you will not be able to get a building permit. You will perpetually be in violation,” Jo Ann B. Eala, head of sustainable energy finance and specialized lending of BPI, told BusinessWorld after the company’s event held at Makati City on April 4.
The Philippine Green Building (GB) Code of 2016 covers hospitals, offices, hotels, and schools with a minimum of 10,000 square meters (sq.m.) floor area, malls over 15,000 sq.m., and residential condominiums over 20,000 sq.m. This sets standards for these infrastructure related to energy efficiency, water and wastewater management, solid waste management, site sustainability, and indoor environmental quality.
Ms. Eala said after the implementation of the law, the number of green buildings in the Philippines more than doubled in terms of the company’s portfolio. For green building projects alone, BPI disbursed P9.6 billion as of end of 2018. The Ayala-led bank is targeting to further grow the program in order to reach more businesses.
“We target to grow at a much faster rate than regular loans … Definitely, more than 10%. If we can 15% (a year)… With the momentum of the green building take-up, I think we could go at a really much faster rate than the regular loans,” she said during the event.
“In terms sustainable energy and sustainable development, we’re looking at probably between 15 to 20% in terms of our target growth. I think it will be accelerating compared to where it was previously because we are seeing increased consciousness among borrowers… and we think that will continue to grow as time goes on,” Eric Roberto M. Luchangco, senior vice president and head for corporate credits products group of BPI.
Just like any other green initiative, BPI’s green financing program also faced challenges such as businessmen’s perceptions that these types of projects will be very costly.
“The initial challenge was resistance because of the perceived cost without knowing the benefits. Remember, a businessman still looks at the bottomline, so if they are not aware of how much they are to gain also in terms of profitability then it becomes hard,” Ms. Eala said.
In order to encourage more businesses to join, BPI made itself the example. At its head office Makati City, 30-year old chillers were replaced which resulted in annual savings of about 990 megawatt hour (MWh) or about P12 million since 2012. Furthermore, it was able to avoid emission of greenhouse gases (GHG) at 431 total carbon dioxode (tCO2) per year.
Another project is Imperial Homes Corp.’s Via Verde Village in Sto. Tomas, Batangas. It is touted as the first solar-powered with lithium battery, low-cost housing subdivision in the country. It is able to generate 529 MWh per year or P5 million per year. It also has an estimate GHG avoidance at 2,380 tCO2 per year.
“What we hope to do, knowing that there is so much potential in the business sector, is to educate first and encourage more and more private sector participation in sustainable initiatives. This as a whole is mobilizing and boosting private sector participation in protecting the environment but making sure as it is done, it is done in a very successful, well-studied way so that the project will definitely yield the results expected… and will encourage the business sector to continue and make it a sustainable venture,” Ms. Eala said.