Philippines issues first carbon credit rules to accelerate clean energy — and raises questions about a fragmented market.
The Philippines has released its first regulatory framework for carbon credits in the energy sector, a move the government says will accelerate clean energy investments and cut greenhouse gas emissions. The rules, set by the Department of Energy (DOE), are designed to channel carbon finance into the country’s power system and help the Philippines participate in global carbon markets under the Paris Agreement.
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What the New Circular Does
Department Circular No. DC2025-09-0018—signed by Energy Secretary Sharon S. Garin on September 23 and published October 10—lays out the processes for generating, verifying, owning, and trading carbon credits.
- What is a carbon credit? One unit represents one metric ton of CO₂ emissions avoided, commonly from renewable energy projects, energy efficiency improvements, or early retirement of fossil fuel plants.
- Why it matters: Credits can be sold to organizations seeking to offset their carbon footprint, a mechanism expected to boost carbon finance flows into the Philippines.
The DOE created a Task Force on Energy Carbon Credits (TFECC) to oversee implementation, uphold transparency, and prevent “double counting.”
In announcing the policy, the DOE said the Circular “promotes transparency, accountability, and environmental integrity” by ensuring projects generate real, measurable, and verifiable emission reductions.
In announcing the policy, the DOE said the Circular “promotes transparency, accountability, and environmental integrity” by ensuring projects generate real, measurable, and verifiable emission reductions.
International Alignment and Partnerships
The Circular supports collaboration with Singapore, Japan, and European Union members to align with international carbon trading standards. The DOE says this will help the Philippines participate in global markets while offering new incentives for low-carbon energy solutions.
The initiative forms part of the Philippine Energy Plan (PEP) 2023–2050, which targets a secure, low-carbon futurethrough more renewable energy, enhanced energy efficiency, and deployment of green technologies.
Industry observers caution the new rules could “fragment” the national carbon credit landscape because they apply only to the energy sector, without an overarching cross-sectoral framework. That gap, they say, could complicate market development even as the energy rules move forward.
A full copy of Department Circular No. DC2025-09-0018 is available online.
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