The Kenya carbon credit market comprises transaction of carbon credits, which represents one ton of carbon dioxide or equivalent greenhouse gases reduced or absorbed from the atmosphere. Carbon credits generated in Kenya can be traded in voluntary and compliance carbon markets globally. The government of Kenya has established a favorable regulatory environment for carbon trading and recognizes carbon credits as tradable commodities. The need for carbon credits is increasing as many organizations aim to meet sustainability targets and reduce carbon footprint. The global Kenya carbon credit market is estimated to be valued at US$ 475.7 Mn in 2024 and is expected to exhibit a CAGR of 32.% over the forecast period 2024-2031.
Key Takeaways
Key players operating in the Kenya carbon credit market are WGL Holdings, Inc, Enking International, Green Mountain Energy, Native Energy, Cool Effect, Inc., Sustainable Travel International, 3 Degrees, Terrapass, and Sterling Planet, Inc. These players are focusing on project development and marketing of carbon credits from Kenya in voluntary and compliance markets.
The key opportunities in the Kenya carbon credit market include increasing participation in the voluntary carbon market, emergence of new compliance carbon markets, and potential linkages between Kenya's carbon trading platform and other international platforms. The government of Kenya is also promoting programs to incentivize private sector investment in the domestic carbon market to meet Paris Agreement commitments.
The key players in the Kenya carbon credit market are also exploring opportunities in international compliance carbon markets like the EU Emissions Trading System. Regional expansion within Africa is another growth avenue as countries like South Africa and Nigeria also develop domestic carbon trading policies. Linkages between carbon trading platforms of East African countries can further accelerate cross-border carbon credit flows.
Market Drivers
Growing government support in the form of policies and voluntary carbon trading platform has boosted carbon credit generation and trading in Kenya. The Kenya carbon exchange established in 2019 has provided impetus to carbon credit projects. Stringent emission norms in Europe and carbon taxes in other countries are also driving demand forAfrica-based offset projects.
Market Restraints
Lack of robust infrastructure for MRV is a challenge which needs to be addressed through technology upgradation and skill development. High transaction costs and small project sizes remain a bottleneck. Additionality concerns and permanence risks deter compliance buyers from Africa-based projects. Stringent validation and verification also limit supply of high-quality credits.
Segment Analysis
In the Kenya carbon credit market, Compliance segment dominates currently with over 60% share owing to the cap-and-trade programs introduced by the government to limit total carbon emissions from large industrial facilities and power plants. Within the compliance segment, power and utilities sub-segment hold major share as they emit large amount of greenhouse gases through combustion of fossil fuels for power generation. They are mandated to offset their emissions through purchase of carbon credits in the regulated carbon market. Voluntary carbon offsetting segment is emerging with growing environmental consciousness among corporates and individuals globally. Transport and logistics industry is the fastest growing voluntary segment as businesses aim for carbon neutrality in operations.
Global Analysis
Africa region holds around 15% share in the global carbon credit market currently. Kenya carbon credit market is fastest growing in the region driven by government's commitment to transition to greener economy and achieve carbon neutrality by 2050 as per its NDCs under Paris Agreement. East Africa sub-region dominated the Africa carbon credit market with over 40% share in 2024 led by demand from Kenya and Tanzania. Stringent regulations and incentives for renewable energy projects contributed to credit demand. Emission reduction projects in areas of renewable energy, forestation and waste management are major contributors of credits.
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Author Bio:
Alice Mutum is a seasoned senior content editor at Coherent Market Insights, leveraging extensive expertise gained from her previous role as a content writer. With seven years in content development, Alice masterfully employs SEO best practices and cutting-edge digital marketing strategies to craft high-ranking, impactful content. As an editor, she meticulously ensures flawless grammar and punctuation, precise data accuracy, and perfect alignment with audience needs in every research report. Alice's dedication to excellence and her strategic approach to content make her an invaluable asset in the world of market insights. (LinkedIn: www.linkedin.com/in/alice-mutum-3b247b137 )
What Are The Key Data Covered In This Kenya Carbon Credit Market Report?
:- Market CAGR throughout the predicted period
:- Comprehensive information on the aspects that will drive the Kenya Carbon Credit 's growth between 2024 and 2031.
:- Accurate calculation of the size of the Kenya Carbon Credit and its contribution to the market, with emphasis on the parent market
:- Realistic forecasts of future trends and changes in consumer behaviour
:- Kenya Carbon Credit Industry Growth in North America, APAC, Europe, South America, the Middle East, and Africa
:- A complete examination of the market's competitive landscape, as well as extensive information on vendors
:- Detailed examination of the factors that will impede the expansion of Kenya Carbon Credit vendors
FAQ’s
Q.1 What are the main factors influencing the Kenya Carbon Credit ?
Q.2 Which companies are the major sources in this industry?
Q.3 What are the market’s opportunities, risks, and general structure?
Q.4 Which of the top Kenya Carbon Credit companies compare in terms of sales, revenue, and prices?
Q.5 Which businesses serve as the Kenya Carbon Credit ’s distributors, traders, and dealers?
Q.6 How are market types and applications and deals, revenue, and value explored?
Q.7 What does a business area’s assessment of agreements, income, and value implicate?
