A Philippines’ House of Representatives committee has approved a landmark bill aimed at integrating companies into the country’s decarbonisation efforts, aligning with a United Nations (UN) agreement to limit global temperature increases to no more than 2°C this century.
The climate change committee endorsed a substitute bill that seeks to curb greenhouse gas (GHG) emissions from businesses. This proposed legislation establishes a carbon pricing framework requiring companies that surpass government-set emission targets to invest in environmental sustainability projects to offset their carbon output.
“It not only sets a clear policy direction for decarbonization but also provides businesses with the tools and flexibility to achieve these goals in a way that supports economic growth,” Bohol Rep. Edgar M. Chatto said in a statement.
“The bill encourages investments in low-carbon technologies that can deliver cost efficiencies for businesses, while significantly reducing their environmental impact,” he added.
According to a Swiss Re Group statement from February, climate change costs the Philippines 3% of its annual economic output.
The bill allows companies to choose from various decarbonisation initiatives, including investing in their own low-carbon projects, collaborating with other businesses to fund low-carbon technology development, or making equity investments in environmental sustainability firms.
“The bill’s flexibility is designed to empower businesses to choose the most effective and economically viable path to decarbonisation, whether through direct investments in their operations or by supporting broader industry-wide initiatives,” the House Climate Change Committee said.
Bukidnon Rep. Jose Manuel F. Alba highlighted that the measure aims to foster investment in sustainable technology, driving economic growth and innovation. It also introduces a domestic carbon market, enabling Philippine companies to buy, sell, or trade carbon credits for their operations.
“The bill provides enabling measures to support investments… facilitating access to carbon markets and international climate finance, which can help de-risk investments and make them more profitable,” according to the statement.