Kenya sets sights on carbon trading rules in law review


Women conservators in Mtangawanda, Lamu showing mangroves they grew. Communities dealing with mangroves in Lamu will benefit from the Blue Carbon project which will enable them to generate Sh13 million per year if the intended carbon credit project is implemented in the county this year. PHOTO | KALUME KAZUNGU | NMG

The Kenyan government has set up a legal framework that will anchor its carbon trading.

Proposed changes to the Climate Change Act, 2016, carried in the Climate Change (Amendment) Bill, 2023 seek to set regulations for domestic carbon markets.

For instance, trading in carbon credits shall result from bilateral or multilateral agreements, a voluntary carbon market or trades with a private entity.

The Environment Cabinet Secretary shall clear trades in carbon credits while prescribing additional requirements on the regulation of carbon markets.

“The Cabinet Secretary may, with the approval of the Cabinet, enter into any agreement to trade in a carbon market established or overseen by an internationally recognised entity that is approved by a recognised credible international body,” reads the bill that was tabled in Parliament last week.

A carbon market is a mechanism allowing public and private entities to transfer and transact emission-reducing units, mitigation outcomes or offsets generated through carbon initiatives, programmes and projects.

Carbon credits meanwhile refer to units created when the equivalent of one metric tonne of carbon dioxide is tapped before entering the atmosphere.

Despite having an elaborate climate change law, Kenya has, until now, lacked a clear mechanism enabling the trading of carbon credits.

This is despite companies like KenGen already generating carbon credits.

Earlier this year, for instance, the electricity generating company disclosed the planned sale of 287,416 certified emission reduction credits, generated from its Olkaria geothermal power projects.

“We have the Climate Change Act of 2016, but it does not address carbon trading sufficiently. We need to amend that Act so that we can introduce regulations for trading carbon,” Stella Ojango, an environmental lawyer, told the Business Daily in an earlier interview.

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