Kenya launches national carbon registry, paving way for global investment

The Kenyan government has taken a major step to strengthen the country’s carbon market, signalling its readiness to attract international investors and increase revenue. 

On Tuesday, the Ministry of Environment, Climate Change and Forestry officially launched the Kenya National Carbon Registry (KNCR), moving the country’s carbon trade into a virtual platform.

Cabinet Secretary for Environment and Climate Change, Dr Deborah Barasa, said the move aims to bring order, transparency, and credibility to Kenya’s carbon market, making it more appealing to global investors.

“This registry addresses a long-standing challenge where a single ton of carbon could be claimed twice, undermining our credibility. Communities at the frontline of conservation often received little benefit, while the value of our carbon credits, locally called ‘Hewa Kaa’, leaked through opaque arrangements. Without a trusted system, we were wealthy in assets but poor in proof,” Dr Barasa said during the launch.

The initiative aligns Kenya’s carbon market with Article 6 of the Paris Agreement, a global framework that supports countries in meeting climate targets and unlocking financial support for developing nations.

What Is Carbon Trade and Why It Matters

Carbon credits are tradeable certificates representing one metric ton of carbon dioxide absorbed or avoided by projects such as mangrove restoration, indigenous forest conservation, rangeland rehabilitation, or clean cooking initiatives. These certificates serve as proof that developers are actively reducing greenhouse gas emissions.

Industrial, transport, and energy companies, primarily the largest emitters, can purchase these credits to offset their emissions and work toward a net-zero carbon footprint. Globally, the top emitters include China, the United States, India, the European Union, Russia, and Japan, with China contributing the highest levels of carbon dioxide emissions.

While Africa contributes only about 3% of global emissions, it is a major supplier of carbon credits through its vast forests, wetlands, and other natural resources. This makes African countries, including Kenya, key players in the global carbon market.

How Carbon Trade Works in Kenya

Carbon projects are developed, validated, and registered before credits are issued. The process involves:

• Project Development: Initiatives that absorb or avoid carbon emissions are identified.
• Validation and Licensing: Projects receive a “no objection” letter and approval from Kenya’s Designated National Authority (DNA)—the National Environment Management Authority (NEMA).
• Third-Party Verification: Independent auditors, such as Verra and Gold Standard, ensure that emission reductions are real and meet international standards.
• Registry Recording: Verified projects are logged in the National Carbon Registry.
• Credit Sale and Retirement: Carbon credits are sold to buyers, and once traded, credits are “retired” to prevent double-selling.

Key players in Kenya’s carbon market include community-based groups, landowners, renewable energy companies like KenGen, clean cookstove organisations, and wetland conservation groups. Buyers include airlines, vehicle manufacturers, and oil companies seeking to offset their emissions. Brokers connect developers and investors and manage transactions.

Regulation and Governance

The Climate Change Act 2016 designates NEMA as the regulator of Kenya’s carbon market. The 2024 Climate Change (Carbon Trading) Regulations established the National Carbon Registry to enhance transparency, curb double-selling, and standardise carbon project approvals.

The registry distinguishes between voluntary and compliance carbon markets, with distinct standards for certification and verification. Voluntary markets allow private actors to offset emissions voluntarily, while compliance markets involve entities legally required to meet emission reduction targets, such as airlines and power generators.

Gitonga Mugambi, Principal Secretary for the State Department of Forestry, highlighted that the registry complements Kenya’s REDD+ registry, launched in July 2025, which tracks forest-based emission reductions. “Together, they form a coherent national carbon market infrastructure, enhancing credibility and confidence for communities, private developers, and county governments,” Mugambi said.

Engineer Festus Ng’eno, Principal Secretary for Environment and Climate Change, added: “By digitising core processes and migrating all existing projects to this platform, we ensure transparency and accountability. Our collective responsibility is to deliver real benefits to communities from carbon market investments.”

Economic Incentives for Carbon Markets

Under the new regulations, 25% of carbon credit proceeds must fund local community projects. Additionally, certified entities operating in the carbon market receive a preferential corporate tax rate of 15% for the first 10 years, further incentivising investment.

While Africa accounts for only 11–16% of global carbon credits, the continent is seen as a rapidly growing market with high potential. Other key suppliers include Latin America and Asia.

Kenya’s National Carbon Registry positions the country to leverage its natural resources effectively, attract international investment, and ensure that local communities benefit from global climate finance. It also marks a critical step in the nation’s commitment to meet Paris Agreement targets and contribute to the global fight against climate change.