Philippines: Conversion of a coal-fired power plant to 246 MW of renewable energy

ACEN, GenZero and Keppel join forces to convert a Philippine coal-fired power plant into a renewable energy facility by 2030, using transition credits as financial leverage.

Share:

Transformation of renewable coal-fired power plants

Leading energy players ACEN, GenZero and Keppel Ltd. announce a strategic partnership to convert the South Luzon Thermal Energy Corporation (SLTEC) coal-fired power plant in Batangas, Philippines.
This innovative initiative, which involves the early closure of the plant by 2030, is based on the use of transition credits, a financial mechanism designed to accelerate the reduction of carbon emissions.
In a context where South-East Asia has one of the world’ s newest and largest fleets of coal-fired power plants, this approach marks a decisive turning point.
If successful, the SLTEC project could serve as a model for other countries in the region, demonstrating the technical and economic viability of converting traditional thermal power plants into renewable energy infrastructures.

Financial leverage for energy transformation

At the heart of this project is the transition credit mechanism.
These credits, generated by the reduction in greenhouse gas emissions during the plant’s conversion, will provide crucial funding for the decommissioning of existing infrastructure and the installation of new renewable capacity.
The project involves replacing SLTEC’s 246 MW of baseload generation with an integrated solar generation and energy storage system, tailored to the region’s fluctuating energy needs.
This approach could circumvent the financial hurdles often encountered in energy transition, while promoting faster adoption of clean technologies.
The partners hope to pave the way for future similar initiatives, both in the Philippines and in other countries where dependence on coal remains a major challenge.

Social and environmental issues

The SLTEC project involves more than just technological conversion.
It also incorporates measures to mitigate the socio-economic impacts of plant closure.
Employee retraining, asset reallocation and management of the consequences for local communities are all integral parts of the approach adopted by ACEN, GenZero and Keppel.
Compliance with environmental, social and governance (ESG) criteria is a fundamental pillar of this initiative.
At the same time, the project is supported by international initiatives such as the Rockefeller Foundation’s Coal to Clean Credit Initiative and the Monetary Authority of Singapore’s Transition Credits Coalition.
These collaborations ensure that the transition credits generated meet the highest standards of environmental integrity, while facilitating their adoption on international markets.

Towards a replicable regional strategy

The innovative approach adopted for the SLTEC plant could well serve as a model for other energy transition projects in the region.
In particular, the integration of transition credits as a financial tool overcomes economic barriers that often hold back energy conversion projects.
This mechanism could also be used to meet the requirements of Article 6 of the Paris Agreement, which allows the transfer of carbon credits between countries to meet climate targets.
The Singaporean government has expressed interest in acquiring such credits, provided they meet Singapore’s rigorous sustainability standards.
This international recognition could enhance the credibility and attractiveness of transition credits, facilitating their integration into financing strategies for decarbonization projects across Southeast Asia.

Green Hybrid Power secures initial $4.4mn financing to launch a 1 GW floating solar power plant in Zimbabwe, aiming to supply 500 MW to industry under a twenty-year contract.
Loblaw Group will deploy a 7.5 MW photovoltaic installation on the roof of its East Gwillimbury distribution centre, generating up to 25% of the site’s annual electricity and marking a new step for the Canadian logistics sector.
Savion, a Shell subsidiary, transfers majority ownership of five solar projects to Tango Holdings, 80% owned by Ares, to optimise the U.S. renewable electricity production portfolio and improve the profitability of the oil group’s investments.
Investment fund KKR is committing $335mn in a strategic partnership with CleanPeak Energy to accelerate the rollout of solar, storage and microgrid solutions aimed at Australian businesses.
Bluebird Solar is initiating a significant investment plan in Greater Noida to increase its production capacity to 2.5 GW and integrate automated lines powered by artificial intelligence.
TotalEnergies ENEOS has commissioned a 680-kilowatt photovoltaic facility at TechnipFMC’s Johor Bahru site, supplying 20% of the factory’s energy needs under an 18-year power purchase agreement.
Voltalia has been selected for the construction of two photovoltaic plants in Ireland, totalling 92.9 megawatts, further strengthening its presence in the country’s solar infrastructure market.
The latest report from the International Renewable Energy Agency confirms the cost superiority of renewables, but highlights persistent challenges for grid integration and access to financing in emerging markets.
EDP Renewables North America and California Water Service have entered into a 20-year agreement to supply solar energy to a strategic Bakersfield site, reducing grid energy costs by about $1.7mn over the contract duration.
Solar growth in the European Union is seeing its first annual contraction in ten years, following reduced subsidies and shifting budget priorities in several member states.
Scatec secures the development of a 846 MW photovoltaic cluster in the Free State province, with an investment of ZAR13bn ($735mn), following the seventh round of South Africa's REIPPPP programme.
Enbridge invests $0.9bn in a 600 MW solar facility in Texas, fully dedicated to powering Meta Platforms, Inc.'s data centres through a long-term power purchase agreement.
ENGIE has announced the acquisition of 22 distributed solar projects in Pennsylvania, further strengthening its renewable energy expansion strategy while supporting the local economy and enhancing the reliability of the distribution grid.
Estuary Power commissions the Escape Solar and Storage project in Nevada, integrating 185 megawatts of solar capacity and securing enhanced financing from institutional investors to supply electricity to several major players in the leisure sector.
New anti-dumping tariffs and Foreign Entity of Concern (FEOC) restrictions are disrupting the US solar supply chain, while ongoing dependence on China exposes the industry to significant risks, according to Wood Mackenzie.
Sri Lanka and the International Solar Alliance (ISA) have signed a strategic partnership to accelerate solar energy deployment in the country, aiming for 70% renewable energy by 2030.
Sunrun announced the pricing of its $431 million securitization, involving leases and power purchase agreements. This marks the company’s 14th public securitization and its third of 2025.
Resalta has completed the acquisition of Statkraft’s Croatian platform, expanding its presence in renewable energy across Eastern Europe, with a portfolio of projects and a full local team.
Gaia Renewables 1 has acquired a 10% stake in two solar power plants in the Northern Cape, following regulatory approval and financial close, strengthening its portfolio of independent assets.
Dutch firm Gutami Holding has signed a 25-year agreement with Burkina Faso and national utility SONABEL for a 150 MW solar project with 50 MW storage, valued at over €100mn ($109mn).