- The Coal to Clear Credit score Initiative (CCCI), a consortium of world consultants, receives high-level endorsement from Philippines’ ACEN to start exploring the world’s first coal-to-clean pilot challenge within the Philippines, supported by the Financial Authority of Singapore
- CCCI is already actively participating with sovereign consumers of credit beneath the Paris Settlement, with assist from the COP28 Presidency
- In the meantime CCCI submits “transition credit” draft methodology for evaluation forward of its public session, launching Monday December 4 2023, following 5 public stakeholder consultations
- The draft methodology will allow funding from carbon markets to speed up a simply coal-to-clean power transition in rising economies, operationalizing the Paris Settlement
The Coal to Clear Credit score Initiative (CCCI), which has assist from The Rockefeller Basis, introduced a brand new collaboration with ACEN Company to discover a pilot challenge within the Philippines that might leverage carbon finance to section out a coal-fired energy plant and substitute it with renewable power, whereas supporting livelihoods of weak folks. This primary-of-its-kind challenge will search to tell plans for the CCCI to assist section out coal crops across the globe in step with the Paris Settlement. CCCI and ACEN are working with the Financial Authority of Singapore (MAS) to advance the potential challenge.
“If the world doesn’t break its overreliance on coal, present and deliberate coal-fired energy crops will launch 273 billion tons of carbon dioxide over their operational lifetimes and set off a disaster for our planet and the folks dwelling on it,” mentioned Dr. Rajiv J. Shah, President of the Rockefeller Basis. “To retire coal crops, keep away from these emissions, and create jobs, we have to create the suitable incentives for asset house owners and communities and mobilize extra finance. This progressive CCCI settlement will pilot a coal-to-clean credit score methodology within the Philippines, one important step towards breaking that overreliance and constructing a greater future.”
The challenge, the South Luzon Thermal Power Company (SLTEC) coal plant, would change into the world’s first coal-fired energy plant to leverage carbon credit to allow its early decommissioning. Whereas monetary instruments are already in place to assist the early retirement of coal-fired energy crops and their alternative with clear energy, these are difficult to deploy in rising markets and creating economies (EMDEs). The companions will discover the viability of an early retirement and repurpose the plant in direction of cleaner power choices as early as 2030, a decade forward of its present retirement date.
Launched in June 2023, CCCI’s ‘coal-to-clean’ credit will purpose to incentivize a simply transition away from coal crops to scrub power in EMDEs, whereas additionally producing funding to assist simply transition plans that might make investments in routes to new employment, entrepreneurship, and reskilling for employees in communities which have historically relied on the fossil gasoline economic system for his or her livelihoods.
“As we speak’s improvement marks a important contribution to accelerating a worldwide power transition. With out a fast and proactively managed transition away from coal-fired energy, the world won’t meet its local weather objectives; the urgency of fixing this drawback can’t be understated. ACEN is proud to be working with The Rockefeller Basis’s Coal to Clear Credit score Initiative and the Financial Authority of Singapore to develop this world-first challenge,” mentioned Eric Francia, President & CEO of ACEN Company, which has ~4,500 megawatt (MW) of attributable capability within the Philippines, Australia, Vietnam, Indonesia, and India, with a renewable share that’s among the many highest within the area.
Associated Article: The Rockefeller Basis Commits USD 1 Billion To Advance Local weather Options
CCCI can be serving to international locations to work collectively and lift their local weather ambitions by the expansion of regulated carbon markets beneath the Paris Settlement.
“The economics of phasing out coal fired energy crops are difficult. There’s a want for efficient market-based financing options, together with the usage of transition credit to enhance the financial case of retiring these crops early and we’re happy to collaborate with ACEN Company and Local weather Sensible Ventures to pilot the usage of CCCI’s methodology. By means of the pilot transactions that MAS has convened, we hope to road-test and study from totally different approaches that may catalyze the usage of high-integrity transition credit to assist the early retirement of coal crops on a considerably bigger scale.” mentioned Gillian Tan, Assistant Managing Director and Chief Sustainability Officer, Financial Authority of Singapore
CCCI is working with the COP28 Presidency to safe curiosity and engagement from extra sovereign consumers and achieve high-level curiosity from energy producers in EMDEs, making the primary use of ‘transition credit’ a nearer-term actuality.
The work on the pilot is topic to CCCI’s challenge methodology being authorised by Verra, a number one international carbon normal, the conclusion of the general public session, and its utility to the pilot challenge. The methodology permits organizations looking for to develop bespoke coal-to-clean power tasks that prioritize the wants of native communities, and subject transition credit to international consumers.
As soon as finalized after the consultation, launched at this time and working from December 4 2023 to January 16 2024, CCCI’s methodology could be anticipated to facilitate one of many first transactions of transition credit within the international carbon markets, both for voluntary use or compliance functions. As such, it might assist with the operationalization of Article 6 of the Paris Settlement whereas supporting sovereign efforts to restrict international warming to 1.5°C.
“The transition from coal-to-clean power in rising markets is caught” added Dr. Joseph Curtin, Managing Director of the Energy and Local weather workforce on the Rockefeller Basis. “We want new options that may assist the retirement of a fleet of coal fired energy crops throughout the globe. As we speak’s announcement may very well be the primary of many, if we will show it’s doable, which we hope to do subsequent yr”.
- “The CCCI’s exploratory work to section out coal-fired energy crops and substitute them with renewable power is to be counseled. If profitable, this work will play an essential position in holding 1.5C inside attain. The usage of this progressive market-based mechanism additionally supplies a possible new pathway to assist rising and creating nations to transition to a safer and environment friendly power future.” His Excellency Dr. Sultan Ahmed Al Jaber, COP28 President
- “PLN is absolutely dedicated to accelerating the power transition in direction of greener power to make sure a greater future for the subsequent generations. PLN has put nice effort to decarbonize by cancelling 13.3 GW of deliberate CFPP, terminating energy buy settlement of 1.3 GW CFPP and halting new improvement of CFPP. One in every of our most important focuses has been coal section down, this extraordinary initiative requires worldwide assist, one of many concrete examples is thru collaboration with CCCI. We’re in full assist to CCCI, and prepared to make the most of the carbon methodology and develop the carbon challenge as soon as it’s prepared”, says Darmawan Prasodjo, PLN CEO
- “Monetizing emission reductions from phasing out coal-fired energy crops and changing them with clear energy is prone to be instrumental in supporting the monetary viability of coal transition mechanisms in rising markets,” mentioned Barbara Buchner, International Managing Director of Local weather Coverage Initiative. “Nonetheless, such carbon credit should mirror actual and verifiable emissions reductions, and must assist a simply transition for affected employees and communities. CPI is happy to be supporting this work to make sure that it has excessive integrity and prompts an equitable transition.”
- “Transitioning Asia out of its dependence on coal fired energy urgently requires a various set of options fastidiously designed for the realities of the area however deployed to realize high-integrity outcomes that ship real-world emissions reductions. As a powerful advocate of ‘learning-by-doing’, Local weather Sensible Ventures is able to assist this pioneering initiative amongst our companions CCCI, MAS and ACEN to determine and mannequin appropriate use circumstances the place transition credit will be right-sized to incentivize Asia’s energy portfolio house owners to lift and execute their coal to scrub ambitions within the shortest time doable,” says Lawrence Ang, Managing Accomplice of Local weather Sensible Ventures