ACEN Teams Up with Mitsubishi to Fast-Track Coal Plant Retirement
- May 13, 2025
Ayala-led ACEN Corp. is stepping up efforts to retire its coal plant in Batangas ahead of schedule by partnering with Japan’s Mitsubishi Corp. and its subsidiary, Diamond Generating Asia Ltd. (DGA).
Mitsubishi and DGA have formally joined the initiative by signing a deed of accession to the memorandum of understanding (MOU) that ACEN, GenZero, and Keppel Ltd. signed last year.
With the new partners on board, the group aims to boost the use of transition credits to support the early closure of the 246-megawatt South Luzon Thermal Energy Corp. (SLTEC) coal facility. The partnership also aims to develop comprehensive technological solutions to replace the Batangas coal plant’s power output with clean, dependable energy sources.
ACEN President and CEO Eric Francia said the collaboration with Mitsubishi and Diamond Generating Asia is a significant step in tackling the “enormous challenges” of shifting to cleaner energy.
“By pioneering the transition credits mechanism, we are not only accelerating decarbonization but also demonstrating a viable pathway for coal-dependent economies to transition sustainably,” Francia said. “We hope this will serve as a catalyst for other coal plant owners to embark on their clean energy journey.”
Transition credits are a type of carbon credit generated when coal plants are retired earlier than planned and replaced with renewable energy. Governments, companies, or investors can purchase these credits to help offset their emissions. The funds raised are typically used to support new renewable energy projects.
(Also read: How transition credits can derisk the nation’s switch to green energy)
A scalable approach to energy transition
Since 2023, ACEN has been working with the Monetary Authority of Singapore (MAS) and The Rockefeller Foundation to create a framework that measures emissions reductions from early coal plant retirements while ensuring social and economic protections. The framework went through a broad public consultation process to strengthen its credibility and support its potential for international use.
During the GenZero Climate Summit 2025 in Singapore, Verra CEO Mandy Rambharos announced the organization’s approval of the Coal to Clean Credit Initiative (CCCI) Methodology under its Verified Carbon Standard (VCS) Program.
This approval allows for the issuance of high-integrity Transition Credits, supporting the early phase-out of coal plants through a model that prioritizes strong environmental and social safeguards. The approach ensures a Just Transition by aiding affected communities, avoiding emissions leakage, and maintaining energy reliability through clean energy alternatives.
The approved methodology also offers a financial pathway for plant owners to shut down coal facilities ahead of schedule without shifting the cost burden to consumers or breaching financial obligations.
ACEN originally committed to shutting down the 246-MW South Luzon Thermal Energy Corp. (SLTEC) coal plant by 2040, cutting its expected 50-year lifespan in half, as part of its ambitious decarbonization strategy.
Sources:
https://www.philstar.com/business/2025/05/08/2441315/mitsubishi-reinforces-acens-coal-phaseout
https://www.mas.gov.sg/development/sustainable-finance/transition-credits
https://www.rockefellerfoundation.org/initiatives/coal-to-clean-credits/
https://verra.org/new-verra-methodology-supports-coal-phase-out-and-just-energy-transition/
