WALKING ON HOT COAL: Magbibigay ba ang coal transition carbon credits ng Verra ng tunay na benepisyo para sa klima?

Carbon Market Watch argues that Verra's VM0052 methodology for coal transition credits is flawed and risks issuing low-quality credits that do not represent real emission reductions. The briefing identifies critical failures in additionality testing, baseline setting, leakage prevention, and just transition safeguards, specifically highlighting risks in the Philippines' energy context. It recommends a total suspension of the methodology until significant revisions are made to prevent overissuance and carbon leakage.

• The VM0052 methodology has a high risk of carbon leakage because it only requires a small portion of lost power generation capacity to be replaced by renewable energy. Specifically, it requires only 10% of capacity to be replaced by paired renewables at the start, increasing to at least 40% by the end of the first crediting period, meaning a large part of the energy could still be replaced by fossil fuels.
• There is a significant leakage risk because 'no-new coal' commitments apply only to government-owned utilities and not to all private companies. This allows independent power producers to build or expand coal plants to replace the capacity of retired plants, as seen in the case of the South Luzon Thermal Energy Corporation (SLTEC) pilot project in the Philippines.
• The methodology's approach to additionality is flawed due to vague terminology and a backward-looking 'common practice' analysis. The use of 'essential distinctions' allows developers to manipulate comparisons, and the 10-year historical look-back is unsuitable for countries like the Philippines with newer coal fleets where no historical retirements may have occurred despite future commitments.
• Baseline retirement dates are prone to error because they rely on static assumptions for electricity production and prices. The methodology fails to require a project-specific sensitivity analysis or a reassessment of the 'financially attractive retirement date' during crediting period renewals, which may lead to overissuance of credits.
• There is a risk of double issuance of carbon credits because the methodology lacks coordination mechanisms to prevent both a coal retirement project and a replacement renewable energy project from claiming credits for the same emission reductions.
• The 'just transition' provisions are insufficient, particularly the 2% benefit-sharing rule, which is based on net rather than gross revenue. This allows developers to report lower profits to reduce the amount shared with affected stakeholders. Additionally, the use of developer-chosen 'neutral' third-party mediators creates a conflict of interest.

APA

Wyburd, I., & Pavia, E. (2025). WALKING ON HOT COAL: Magbibigay ba ang coal transition carbon credits ng Verra ng tunay na benepisyo para sa klima? Carbon Market Watch. https://carbonmarketwatch.org/wp-content/uploads/2026/03/Final_FIL_Walking-on-hot-coal_final.combined.pdf

Chicago

Wyburd, Inigo, and Edoardo Pavia. WALKING ON HOT COAL: Magbibigay ba ang coal transition carbon credits ng Verra ng tunay na benepisyo para sa klima? Carbon Market Watch, 2025. https://carbonmarketwatch.org/wp-content/uploads/2026/03/Final_FIL_Walking-on-hot-coal_final.combined.pdf.

Wikipedia

{{cite report |last1=Wyburd |first1=Inigo |last2=Pavia |first2=Edoardo |title=WALKING ON HOT COAL: Magbibigay ba ang coal transition carbon credits ng Verra ng tunay na benepisyo para sa klima? |publisher=Carbon Market Watch |date=December 2025 |url=https://carbonmarketwatch.org/wp-content/uploads/2026/03/Final_FIL_Walking-on-hot-coal_final.combined.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{wyburd2025walking, author = {Wyburd, Inigo and Pavia, Edoardo}, title = {{WALKING ON HOT COAL: Magbibigay ba ang coal transition carbon credits ng Verra ng tunay na benepisyo para sa klima?}}, institution = {Carbon Market Watch}, year = {2025}, month = dec, url = {https://carbonmarketwatch.org/wp-content/uploads/2026/03/Final_FIL_Walking-on-hot-coal_final.combined.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }