Kenya unveils carbon market rule book and caps the overseas sale of carbon credits

NAIROBI, Kenya (AP) — Kenya has introduced a cap on the amount of carbon emissions credits it will authorize for sale to overseas buyers, unveiling one of Africa’s most detailed rule books for international carbon trading.

The country has set a 10 million metric ton (11,023,113 ton) carbon dioxide equivalent budget for international carbon market transactions up to 2030. It establishes a ceiling against which every request will be assessed under the country’s new carbon markets guide.

The guide, released Monday, creates a framework for approving projects under Article 6 of the Paris Agreement, which allows countries to trade emission reduction credits to help meet global climate targets.

“It introduces a national carbon budget for trading to safeguard our Nationally Determined Contribution," or NDC, Environment Cabinet Secretary Deborah Barasa said.

The Paris Agreement, signed just over a decade ago, commits countries to keeping the rise in global temperatures by the year 2100 compared with preindustrial times “well below” 2 degrees Celsius (3.6 degrees Fahrenheit), and says they will “endeavor to limit” them even more, to 1.5 degrees Celsius.

Kenya's carbon budget covers emissions reductions generated in the energy, transportation, industrial processes and waste sectors, with annual allocations capped at 1.67 million metric tons of carbon dioxide equivalent. Officials say the cap is intended to prevent Kenya from overselling carbon credits that it may later need to meet its own NDC under the Paris Agreement.

The framework replaces an often uncertain approval process characterized by its three-stage decision pathway comprising No-Objection, Approval and Authorization.

“The guide establishes a national carbon budget for trading as a binding safeguard,” Environment and Climate Change Principal Secretary Festus Ng’eno said, adding that it provides state agencies with practical decision-making tools throughout a project’s life cycle.

The guide also introduces a conditional list of priority activities covering renewable energy, transportation and waste projects. Forests and other land-use projects are excluded for now while the country develops stronger baselines and data to manage reversal risks. Officials say inclusion on the list does not guarantee approval but is intended to speed the review of projects that align with Kenya’s development priorities.

Kenya has emerged as one of Africa’s largest carbon market destinations, attracting investments in clean cooking , renewable energy, mangrove restoration and forest conservation. The government says the new framework will improve investor confidence by making decisions more predictable while protecting climate integrity and ensuring local communities benefit from carbon market projects.

“Predictability, transparency, and institutional coherence are essential to attracting quality investment," Ng’eno said, adding that government decisions will be based on “clear, published criteria designed to deliver national benefits without compromising Kenya’s climate integrity.”

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