Mitsubishi Corporation and its subsidiary Diamond Generating Asia (DGA) have joined ACEN, GenZero, and Keppel Ltd. in a groundbreaking collaboration to accelerate the early retirement of a 246 MW coal-fired power plant in the Philippines using high-integrity carbon credits called Transition Credits.
The Japanese firms signed a Deed of Accession to a Memorandum of Understanding (MOU) initially established in 2024 by the three founding partners.
The initiative aims to retire South Luzon Thermal Energy Corp.’s (SLTEC) coal plant by 2030—10 years ahead of its scheduled shutdown—replacing it with clean, dispatchable energy.
Transition Credits are verified carbon credits awarded to projects that enable the early closure of coal plants while ensuring the replacement of equivalent power capacity with renewable sources.
The initiative is structured under Article 6 of the Paris Agreement and uses the newly approved Coal to Clean Credit Initiative (CCCI) methodology under Verra’s Verified Carbon Standard.
“This is a credible and scalable mechanism,” said DGA CEO Shinichiro Suzuki. “It balances climate goals with energy security by replacing fossil output with reliable clean energy.”
ACEN, the listed energy platform of Ayala Corp, pioneered the Energy Transition Mechanism in 2022. CEO Eric Francia said the new partnership could trigger broader adoption of the model: “We are setting a viable pathway for other coal-dependent economies.”
GenZero and Keppel emphasized the importance of a just transition and the opportunity for Mitsubishi’s involvement to support voluntary and compliance carbon markets in Japan.
If successful, the model could be replicated globally, creating a financial mechanism for early coal retirements that supports decarbonization without burdening consumers or disrupting energy supply.
Business News Asia
