The private sector lending arm of the World Bank is eyeing a $5.3-million technical study on how to source funds for renewable energy (RE) projects.

The International Finance Corp. said discussions regarding the amount are already ongoing, with the board set to decide by May 20 this year.

"This project uses $5.3 million of GEF funds to support advisory services ($2.3 million) and risk-sharing ($3 million) for financial institutions," IFC said.

Specifically, IFC is planning to engage in the so-called Philippines Sustainable Energy Finance Project II (Phils SEF II), which aims to support the creation of a commercial financing market for sustainable energy projects in the country.

Phils SEF II will cover both energy efficiency and RE projects, and is said to help the country improve its energy security, economic productivity, and the promotion of private enterprise in the energy sector.

According to the IFC, the proposed technical assistance will focus on providing three to four local financial institutions with the support to develop their own portfolio in sustainable energy projects.

The IFC said the SEF program is made to help improve the country's access to financing for SE projects, which should continue beyond the support of the IFC financial instruments and technical assistance. Moreover, the IFC said it is expecting the technical assistance program to result in business and environmental development.

At present, billions of pesos are set aside by the government through the Development Bank of the Philippines and other government financial institutions for RE development. These funds could be tapped by any individual or entity who are interested to engage in RE projects.

With the passage of the RE bill recently, more investors are now willing to take a look at business opportunities in this field. The energy department is currently drafting the implementing rules and regulations for the RE law.