Introduction and Background: The Philippines emphasizes a green economy transition, with policies focusing on renewable energy, sustainable agriculture, waste management, and low-carbon development. In the current NDC, the Philippines commits to reducing GHG emissions by 990 MtCO2e (75% below business-as-usual projections) between 2020 and 2030 and supports long-term reduction of 10% in overall energy demand by 2040. A total of 59% of these reductions are expected to come from the energy sector. The commercial and industrial (C&I) sectors, which currently account for 33% of the final energy consumption, will play a significant role in this transformation, with cooling systems such as refrigeration and air conditioning being major contributors. However, until today, there is a lack in the quantity and quality of EE projects generated from C&I sectors despite high electricity prices and introduction of favourable policies. At the same time, investment promotion is not fully geared towards potential investors and business models offering energy- (or cooling-) as-a-service are not utilized to enhance EE potential.
Project Goals and Approach to Transformational Change: Philippines – Green Cooling Solutions aims to support the decarbonization of cooling-intensive C&I facilities in the Philippines by increasing demand and supply for energy services and innovative business models. The project aims to address barriers identified at the behavioural, structural, technical, and financial levels. 283 cooling-intensive C&I facilities will have cut their GHG emissions by switching to EE and renewable energy solutions incl. natural refrigerants ESCOs and facility owners will have improved access to finance for bankable EE projects and the ESCO market will become more developed. The improved regulatory environment for EE investments will further support a market transformation.
Project Components and Support Mechanisms: The FC component will improve the accessibility of debt financing by providing concessional loans (EUR 13m) in cooperation with Development Bank of the Philippines (DBP) for bankable EE projects focused on cooling. The credit guarantee facility (EUR 3m) at PhilGuarantee will allow for more lenient lending requirements, such as reduced equity, while lowering potential risk for lenders. Finally, repayable grants (EUR 2m) will support around 430 C&I facilities with investment-grade audits (IGAs). Standardised performance contracts and credit risk improve the framework for EE investments.
TC component will strengthen the technical capacity of C&I facilities and ESCOs. The awareness campaigns on benefits and returns of EE projects and a technical and financial helpdesk will promote the identification and realization of EE projects. C&I facility owners, ESCOs, and financial institutions will be brought together in matchmaking events to increase dynamics in the sector. In total, approx. 1,350 people will benefit from awareness-raising, training, EE+ projects, and matchmaking. Facilities’ capacity for energy management will increase, also due to the availability and reliability of energy services.
Mitigation Potential and Long-Term Impact: The project will support allocation of public and private capital toward EE investments by demonstrating attractive risk‑adjusted returns. Throughout the project, it aims to reduce at least 71,752 tCO2e as direct emission reductions. Additionally, the project anticipates significant emission reductions of up to 648,286 MtCO2e during the lifetime of the technology and up to 199,350 t CO2e as indirect emission reduction. The cost-efficiency of these interventions is estimated at ~50 EUR/tCO2e.