The Coal to Clean Credit Initiative (CCCI), a collaborative effort led by global experts, is currently developing a groundbreaking carbon credit methodology. Starting this month, the consortium will initiate a consultative process to refine the methodology, which will be officially unveiled at COP28. Following accreditation, transactions for coal-to-clean credits could be signed as early as 2024.
CCCI’s primary objective is to catalyze a just transition from coal-fired power plants to renewable energy in emerging economies worldwide. By implementing this methodology, the initiative aims to prevent the planned release of millions of tons of carbon dioxide (CO2) into the atmosphere.
The Rockefeller Foundation and the Global Energy Alliance for People and Planet (GEAPP) are spearheading the CCCI, receiving support from implementation partner South Pole, as well as technical and convening expertise from RMI and Climate Policy Initiative (CPI).
Recently, The Rockefeller Foundation and GEAPP announced the Coal to Clean Credit Initiative, which will establish a comprehensive standard for employing carbon finance to incentivize the transition away from coal-fired power plants towards renewable energy sources in emerging economies. In partnership with CPI, RMI, and South Pole, the initiative will begin a consultative process this month to develop the methodology. This will set a global benchmark for coal transition projects that are financed through carbon credits. The methodology will be presented during the United Nations Climate Change Conference (COP28) in Dubai and is expected to receive endorsement from a leading carbon standard.
Dr. Rajiv J. Shah, President of The Rockefeller Foundation, emphasized that emerging and developing countries have the right to pursue economic opportunities and access to electricity without exacerbating the climate crisis. The Coal to Clean Credits Initiative aims to facilitate the retirement of coal plants in these countries, replacing them with cleaner energy sources. This transition has the potential to prevent the emission of tens of millions of tons of CO2 per plant while creating new opportunities for communities.
Currently, many coal plants are shielded from competition due to regulations or long-term contracts, rendering them financially disinclined to retire prematurely. In response, CCCI is designing a methodology that will enable the accelerated and equitable phase-out of coal plants, incentivizing their complete or partial replacement with clean energy within this decade.
Revenue generated from the sale of ‘coal-to-clean’ credits will provide incentives for coal plant owners to shift their investments towards renewable energy. Additionally, these funds will support the transition of workers and communities away from coal-fired power plants.
CCCI has developed a comprehensive concept in consultation with a technical advisory group of renowned experts. Real-world cases that are well-suited for generating coal-to-clean credits have been identified. The initiative aims to begin signing transactions as early as 2024 and apply the methodology to as many plants as possible in the coming decade, preventing the release of millions of tons of planned CO2 emissions.
GEAPP, leading the initiative, has established a significant partnership with the Republic of Indonesia to develop a roadmap for generating coal-to-clean credits and facilitating the managed and equitable phase-out of coal plants. CCCI has also initiated scoping work in South Africa and Vietnam to form similar partnerships.
CCCI recognizes the crucial role of affected communities in the transition from coal to clean energy and plans to develop just transition plans in collaboration with local stakeholders. These plans will include strategies for new employment, entrepreneurship, and reskilling, ensuring the needs of coal workers and local communities are prioritized throughout the transition process.
Simon Harford, CEO of GEAPP, emphasized that by 2030, the cost of renewable energy will be lower than that of fossil fuels in most regions, potentially creating 25 million secure jobs in Asia and Africa alone. GEAPP is proud to support countries like Indonesia, which is at the forefront of energy transition and carbon market development. The initiative not only provides
financial incentives for emerging economies to transition rapidly from coal to renewable energy but also ensures that jobs and livelihoods are safeguarded during each project’s development and scaling.
The Rockefeller Foundation and GEAPP will receive support from South Pole as the implementing partner, along with technical and convening expertise from RMI and CPI. Together, they are committed to establishing CCCI with the highest standards of environmental integrity, technical excellence, and inclusive stakeholder engagement.
CCCI aims to set a new benchmark for coal transition projects financed through carbon credits, expediting the global shift from coal to clean energy. By offering near-term opportunities at the project level, CCCI’s methodology aligns with jurisdictional approaches and system-level decarbonization. The initiative explores an innovative, system-integrated project approach to mobilize carbon finance and accelerate the managed and equitable phase-out of coal plants, promoting their complete or partial replacement with clean energy sources.
CCCI acknowledges that coal plants are strategic assets within national power systems, necessitating careful consultation with national authorities to evaluate the system-wide impacts associated with their accelerated retirement. The initiative will also be designed to integrate with existing and future compliance markets and voluntary markets.
CCCI complements other carbon market and public climate finance initiatives that share the same objective while working towards an accelerated transition timeline. For instance, CCCI can unlock private finance required for larger-scale initiatives like Just Energy Transition Partnerships (JETPs). Furthermore, it contributes to broader carbon market development by increasing the supply of high-integrity credits and establishing clear standards for buyers.
Over the coming months, CCCI will continue to share expertise with stakeholders and coal transition initiatives, including carbon standards, international finance institutions, and organizations working on financial mechanisms. Stakeholders are encouraged to participate in CCCI’s local consultations and stakeholder learning sessions on the transition from coal to clean energy. The initiative is committed to collaborating with stakeholders in establishing this new benchmark for coal-to-clean projects.
Dr. Joseph Curtin, Managing Director for Power and Climate at The Rockefeller Foundation, highlighted the importance of providing a credible pathway for coal plants in emerging economies to transition sooner to mitigate the threat of global warming beyond 2 degrees Celsius. Retiring just one plant and replacing it with clean energy decades ahead of schedule can prevent the release of tens of millions of tons of CO2 emissions. Achieving this goal requires compelling incentives and additional finance.
- PRESS RELEASE
