Extreme Heat Could Cost Philippines ₱466 Billion Annually by 2030 – DENR

By Rhaydz B. Barcia

Manila, Philippines — The Philippines could be losing up to ₱466 billion annually by 2030 due to extreme heat alone, and unchecked climate change could slash the country’s GDP by 13.6% by 2040, according to Environment Secretary Raphael Lotilla.

Speaking at the Net Zero Carbon Alliance (NZCA) conference held recently at SMX Convention Center, SM Aura, Lotilla highlighted the growing economic toll of climate change.

“From 2014 to 2023, disasters displaced nearly 43 million Filipinos. Extreme heat alone could cost ₱466 billion annually by 2030. Typhoon-related losses already shave 1.2% off the GDP each year,” he said. “Unchecked, climate change could reduce our GDP by 13.6% by 2040.”

Lotilla stressed the urgency of the climate crisis, citing data from the 2024 World Risk Report, which ranked the Philippines as the most at-risk country to natural disasters and climate change for the third consecutive year, despite contributing less than 0.4% of global emissions.

“These are not abstract numbers,” he said. “They reflect lives disrupted, livelihoods lost, and economic resilience eroded. Yet, science tells us that up to two-thirds of projected losses can still be avoided—if we act decisively now.”

He also cited the World Meteorological Organization’s report declaring 2024 as the warmest year on record, with global temperatures reaching 1.55°C above pre-industrial levels—surpassing the critical 1.5°C threshold set by the Stockholm Resilience Centre, which warns of potentially irreversible environmental tipping points.

“Climate-related disasters caused USD 368 billion in economic losses in 2024, 14% above the long-term average,” Lotilla added.

On a more hopeful note, he pointed to the growing momentum in global climate finance. According to the International Energy Agency, USD 1.8 trillion was invested in clean energy in 2023—almost double the amount allocated to fossil fuels. The Glasgow Financial Alliance for Net Zero now represents over USD 150 trillion in assets, marking a major shift in global capital flows.

“With COP30 scheduled this November in Belém, Brazil, these trends—rising temperatures, growing losses, and shifting investments—will be central themes,” he said. “The Philippines must not only keep pace; we must lead by example through credible, science-based climate actions that balance growth with environmental integrity.”

Legislative and Policy Milestones

Lotilla reported that the Low Carbon Economy Investment Bill has passed its third reading in the House of Representatives. The bill mandates major emitters to create decarbonization plans, set emissions ceilings, and invest in low-carbon initiatives. It also introduces a national emissions trading framework, and opens access to carbon markets and international climate finance.

“This is not a regulatory burden for companies—it’s a structured opportunity to innovate, cut emissions, and access green financing,” he emphasized.

He also mentioned progress on the Carbon Rights Bill, which aims to clarify ownership of carbon benefits and unlock opportunities in carbon forestry and ecosystem credits, allowing businesses to invest in measurable environmental outcomes while generating co-benefits for communities and biodiversity.

Complementing these legislative efforts are the BSP’s Sustainable Finance Guidelines, requiring financial institutions to assess climate risks, and the SEC’s upcoming sustainability reporting standards, aimed at improving transparency and investor confidence in local companies.

Ground-Level Action

To implement these policies, Lotilla said the Department of Environment and Natural Resources (DENR) is working closely with businesses, communities, and local governments to turn climate plans into credible, measurable, and profitable actions.

“To achieve a low-carbon, climate-resilient Philippines, DENR is executing a multi-pronged strategy,” he said.

At the heart of this is the Philippine Greenhouse Gas Inventory Management System, a framework for the measurement, reporting, and verification (MRV) of emissions. Lotilla said companies aligned with this system gain access to credible carbon credits and enhanced market credibility.

He also highlighted nature-based solutions like the 5 Million Trees Project by 2028, launched in March 2025, and the Sustainable Forest Land Management Agreement, which encourages forest investments across 1.2 million hectares of public lands released by the DENR.

“By investing in nature, businesses can achieve measurable carbon reductions while supporting community livelihoods,” Lotilla said.