Philippine banks increased financing for coal and gas to record levels in 2025 despite a global energy crisis exposing the country’s vulnerability to volatile fossil fuel markets, according to a new study released Tuesday.
The 2026 Fossil Fuel Divestment Scorecard, published by the Center for Energy, Ecology, and Development (CEED), showed that domestic banks funneled USD 10.15 billion into energy financing last year, with both fossil fuels and renewables reaching historic highs.
The report describes the crisis as a “reckoning of the country’s decades-long dependence on foreign energy,” as global supply disruptions linked to conflict in the Middle East drive up fuel, electricity, and food costs.
Renewable energy financing quadrupled from 2024 levels to USD 5.79 billion, the highest since 2009. At the same time, fossil fuel investments remained substantial, with gas financing reaching a record USD 3.37 billion and coal receiving USD 985 million, its highest level since 2019.
Most fossil fuel transactions were linked to refinancing or acquisitions of existing assets rather than new capacity, the study said.
Bishop Gerardo Alminaza of San Carlos, president of Caritas Philippines and lead convenor of Withdraw from Coal: End Fossil Fuels, said continued financing of fossil fuels is worsening the burden on ordinary Filipinos.
“Today’s energy crisis is but the latest concretization of the consequences of an energy sector reliant on coal, gas, and other fossil fuels,” he said.
“It is a crisis felt at the gut by ordinary Filipinos, as prices of fuel for transport, electricity, and basic goods soar. And every peso that banks still pour on costly fossil fuels prolong our people’s agony,” he added.
The study found that nine of the 14 banks assessed have policies restricting coal financing. However, six of these banks were still involved in coal-related deals last year, largely due to gaps in policy coverage, including refinancing arrangements and financing through investment subsidiaries.
No bank covered by the report has adopted a policy restricting fossil gas financing.
“Philippine banks that have made policies to restrict coal financing must close loopholes that still enable them to contribute to continued dependence on coal nationally,” said Ivan Andres, deputy head for research and policy at CEED.
He said developments in the liquefied natural gas sector, including project delays and price volatility, should prompt banks to reassess their portfolios.
“The challenges experienced by the LNG industry… should already be a lesson learned by banks: that LNG is tricky business,” Andres said. “It is in their and their clients’ best interest to shift away from both and toward portfolios focused on renewable energy.”
Coal and gas accounted for 74% of the Philippines’ power generation in 2025, leaving consumers exposed to global price swings under a system that allows fuel costs to be passed on directly.
In the first month since the outbreak of war involving the United States, Israel, and Iran, global coal prices rose by 17% while liquefied natural gas prices surged by 91%, the report said.
While noting the rise in renewable energy financing, the study said banks must move faster to align their portfolios with a transition to cleaner energy.
“We see rising investments in renewable energy as a positive step forward for clean energy—but now is a time to be taking a leap,” Alminaza said.
“In fully prioritizing renewables immediately… Philippine banks can help unlock hope for clean, affordable, and sustainable energy for all Filipinos,” he added.
