Rockefeller Foundation Backs Early Coal Retirement Using Carbon Credits
The Rockefeller Foundation, along with a consortium, has launched a pilot initiative to retire a coal power plant in the Philippines before its natural life ends. The initiative aims to use carbon credits to decommission the South Luzon Thermal Energy Corporation (SLTEC) plant by as early as 2030, a decade ahead of its current retirement date. This move was announced during the COP28 climate talks in Dubai, highlighting the ongoing efforts to transition away from fossil fuels.
The Coal to Clean Credit Initiative (CCCI), supported by Philippine energy company ACEN and the Monetary Authority of Singapore, is pioneering the use of carbon credits to finance the early closure of coal plants. This initiative is a significant step towards reducing emissions and creating opportunities for job creation in the energy sector.
The plan to close the SLTEC plant ahead of schedule is part of a larger movement to accelerate the shift away from coal. The Asian Development Bank has also reached a conditional deal to decommission an Indonesian power plant nearly seven years earlier than planned as part of its Energy Transition Mechanism (ETM).
CCCI, in collaboration with schemes such as the ETM, is working to close plants ahead of schedule using credits from the CO2 cuts generated by the early closure in the Philippines. This approach represents a new and innovative way to transition towards cleaner energy sources.
While these initiatives are crucial in the fight against climate change, there is a growing demand for tighter scrutiny of carbon credits to ensure they effectively contribute to emission reductions. Critics have raised concerns about the continued use of fossil fuels through the use of carbon credits, emphasizing the need for a more comprehensive approach to reducing emissions.
The introduction of the Coal to Clean Credit Initiative complements the Energy Transition Accelerator (ETA), designed to accelerate the shift away from coal by using funds from high-quality carbon credits. This initiative has the potential to generate more than $200 billion in transition finance by 2035, marking a significant milestone in the global effort to combat climate change.
