Tuesday 12 December 2023

Philippine coal plant chosen for early phase-out using carbon credits

Plans to retire a coal plant in the Philippines and replace it with renewable energy using carbon credits.

The Monetary Authority of Singapore (MAS) is working with the Coal to Clean Credit Initiative (CCCI) – which has support from The Rockefeller Foundation – and ACEN Corporation for the “first-of-its-kind” pilot project.

The South Luzon Thermal Energy Corporation (SLTEC) coal plant would become the world's first facility of its kind to leverage carbon credits to enable its early decommissioning.

The organisations will explore the viability of an early retirement and repurpose the plant towards cleaner energy options as early as 2030, a decade ahead of its current retirement date.

The CCCI's 'coal-to-clean' credits, launched in June 2023, will aim to incentivise a just transition away from coal plants to clean energy in emerging markets and developing nations.

Dr. Rajiv J. Shah, President of the Rockefeller Foundation said: “If the world does not break its over-reliance on coal, current and planned coal-fired power plants will release 273 billion tons of carbon dioxide over their operational lifetimes and trigger a catastrophe for our planet and the people living on it.

“To retire coal plants, avoid those emissions and create jobs, we need to create the right incentives for asset owners and communities and mobilize additional finance. This innovative CCCI agreement will pilot a coal-to-clean credit methodology in the Philippines, one critical step toward breaking that over-reliance and building a better future.”

The work on the pilot is subject to CCCI’s project methodology being approved by Verra, a global carbon standard, the conclusion of the public consultation and its application to the pilot project.