6 May 2026
Climate Smart Ventures and NAPOCOR Partner to Develop Carbon Credit Framework
Climate Smart Ventures and NAPOCOR Partner to Develop Carbon Credit Framework
Ivan Galura, Associate Director
Ruth Reyes, Marketing Associate
Manila, Philippines – 6 May 2026 – Climate Smart Ventures (CSV) and the National Power Corporation (NAPOCOR) have signed a Memorandum of Understanding (MoU) to develop a framework for carbon credits for the Philippines. This partnership aims to unlock and strengthen the environmental value of NAPOCOR’s assets while supporting the goal of the Philippines toward a low-carbon future.
Notably, this collaboration serves as a strategic response to the shifting global finance landscape, specifically following the landmark Implementation of Agreement (IA) on carbon credits collaboration under Article 6 of the Paris Agreement, recently signed between the Philippines and Singapore. This agreement establishes a pathway for the transfer of carbon credits that can be used to meet national climate targets, placing a premium on projects that meet rigorous international standards.
As part of the country’s efforts to strengthen its carbon market framework, the Philippine Department of Energy (DOE) in September 2025 issued the Department Circular No. 2025-09-0018, which provides general guidelines for carbon credit generation and management in the energy sector. With its critical role in advancing national energy security and universal electrification, the government-owned NAPOCOR is uniquely positioned to explore the development of carbon credit projects centered on diesel displacement and renewable hybridization in Small Power Utilities Group (SPUG) systems and large-scale reforestation and watershed management activities.
Through the MOU, CSV and NAPOCOR will design a carbon credit framework aligned with NAPOCOR’s SPUG generation assets and managed land and watershed areas. The partnership seeks to mobilize supplemental, performance-based financing to accelerate diesel displacement and renewable hybridization in off-grid systems and scale reforestation and activities while preserving regulatory integrity.
“By establishing a carbon credit framework, we are laying the preparatory works to access carbon financing, which can diversify revenue streams and lessen dependence on subsidies,” said Jericho Nograles, NAPOCOR president and chief executive officer (CEO). Andy Yap, CSV’s CEO also reaffirmed that “The partnership’s success will ensure that climate initiatives in the Philippines are anchored on credible systems that promote stakeholder participation and strengthen market confidence.”
CSV proposed a phased approach to design and implement a carbon credit framework built upon NAPOCOR’s mandate. Phase 1 of the project will establish the technical, financial, legal, and institutional foundations necessary to determine whether and how NAPOCOR can develop high-integrity carbon credit projects based on SPUG assets and watershed areas. Based on the outcomes, Phase 2 will proceed with the issuance and commercialization of verified carbon credits.
CSV contributes extensive technical expertise for this collaboration. It has a proven track record in the areas of transition credits pilot projects, off-grid hybridization and SPUG-related work, and policy and regulatory advisory.
NAPOCOR plays a critical role in advancing national energy security and universal electrification, particularly in off-grid and missionary areas through its SPUG, and in protecting watersheds that sustain government-owned hydropower assets. Its public-sector mandate supports the development of high-integrity credits with social and environmental co-benefits that are aligned with the national climate commitments.
By combining CSV’s experience in carbon methodology alignment and NAPOCOR’s operational mandate, this high-impact partnership positions carbon finance as a supplemental tool to strengthen electrification, accelerate decarbonization in off-grid systems, and enhance long-term watershed resilience in the Philippines.
About Climate Smart Ventures
Climate Smart Ventures (CSV) is an advisory firm advancing the energy transition in Asia. Our expertise and projects span coal to clean utility-level energy transition, industrial decarbonization, grid transformation, transition finance, and government-level policy recommendations. We also provide ESG and sustainability advisory services, focused on decarbonization and management of environmental and social impacts. Ecosystem building and collaboration are key elements of our firm, which partners closely with the region’s leading corporates and power portfolio owners, investors, off-takers, and others. For more information, visit https://climatesmartventures.com.
About National Power Corporation
The National Power Corporation (NAPOCOR) is a government-owned and controlled operation mandated to perform missionary electrification or powering the farthest islands in the archipelago through its Small Power Utilities Group (SPUG); watershed and dams management in support of power generation; and operations and maintenance of the Agus and Pulangi Hydropower Complexes in Mindanao. It is an attached agency of the Department of Energy (DOE). For more information, visit https://www.napocor.gov.ph/.