Economy, Environment

How We Can Maximize Community Benefits from Carbon Credits Far Beyond Current Broker Profits

As nego­tia­tors bat­tle it out on mat­ters loss and dam­age of cli­mate change impacts at COP 28 in Dubai, Kenyan com­mu­ni­ties can earn sig­nif­i­cant­ly from sell­ing car­bon cred­its. How­ev­er, they ben­e­fit less than the inter­na­tion­al third-par­ty own­ers of these projects.

While in Sau­di Ara­bia in late Octo­ber, Pres­i­dent Ruto sought Sau­di pur­chase of car­bon cred­its from Kenya. Sau­di Aram­co, the world’s largest oil pro­duc­er is a lead­ing buy­er of car­bon cred­its and Kenya can become a key beneficiary.

Accord­ing to var­i­ous reports, in June this year, Kenya received Sh2.07 bil­lion from six­teen Sau­di Firms that includ­ed Aram­co and Sau­di Elec­tric­i­ty Com­pa­ny. They pur­chased Kenya’s car­bon cred­its in an auc­tion orga­nized by Sau­di Arabia’s Region­al Vol­un­tary Car­bon Mar­ket Company.

The big ques­tion is this – how do Kenyan com­mu­ni­ties across the coun­try ben­e­fit from such car­bon trad­ing. Cur­rent­ly and sin­cere­ly speak­ing, they don’t real­ly ben­e­fit as much as they should.

When car­bon traders pur­chase car­bon cred­its from multi­na­tion­al com­pa­nies, they must use part of the pro­ceeds if not all to under­take a con­ser­va­tion project that will result in absorp­tion of a cer­tain amount of car­bon from the atmos­phere. That’s what’s known as car­bon offsetting.

In essence, car­bon cred­its ‘allow’ com­pa­nies to emit a spe­cif­ic amount of car­bon diox­ide or oth­er harm­ful gas­es like methane. One car­bon cred­it is the equiv­a­lent of one ton of emis­sions. Rev­enue from pur­chase of car­bon cred­its is then used in con­ser­va­tion projects like for­est con­ser­va­tion or pur­chase of clean­er cook­ing fuel.

Wher­ev­er these con­ser­va­tion projects are under­tak­en, there are often aggriev­ed local com­mu­ni­ties. They often feel mar­gin­al­ized yet they are the tra­di­tion­al cus­to­di­ans of the ecosys­tems being restored. To show you the plight of these, I would like to high­light two car­bon off­set­ting projects here in Kenya – an ongo­ing project and one that is in the pre­lim­i­nary stages.

Chyu­lu Hills host a lush trop­i­cal for­est that is a crit­i­cal water tow­er in Kenya. The Chyu­lu Hills Car­bon Project seeks to pro­tect the Chyu­lu Hills land­scape, its forests, wood­lands, savan­nahs, wet­lands, and wide vari­ety of wildlife. This ongo­ing car­bon off­set­ting project is worth Kshs 561,600,000 mil­lion annually.

The project’s stat­ed suc­cess­ful con­ser­va­tion work is most amaz­ing. It has report­ed­ly result­ed in at least 83 per­cent reduc­tion in for­est clear­ance which has con­se­quent­ly pre­vent­ed more than 700,000 met­ric tons of green­house gas­es from enter­ing the atmos­phere every year. How­ev­er, the project con­tin­ues to raise more ques­tions than answers. Cen­tral to these ques­tions is finan­cial trans­paren­cy and well-defined com­mu­ni­ty participation.

Sim­i­lar trans­paren­cy ques­tions are being asked dozens of kilo­me­ters away in Olkir­i­ma­t­ian in the vicin­i­ty of the soda lakes of Mag­a­di and Natron. The com­mu­ni­ty in this vast range­land is demand­ing the review of a car­bon agree­ment with the com­mu­ni­ty in order to ensure trans­paren­cy and sub­stan­tial­ly more com­mu­ni­ty ben­e­fits. Just like oth­er com­mu­ni­ties in a sim­i­lar predica­ment, they are also con­cerned about appar­ent trans­fer of their land rights.

That’s why the Car­bon Cred­it Trad­ing and Ben­e­fit Shar­ing Bill cur­rent­ly in the Nation­al Assem­bly must be speed­i­ly debat­ed and enact­ed. Accord­ing to this Bill, car­bon project rev­enue will be divid­ed as fol­lows: the car­bon project own­er – 40 per­cent; the com­mu­ni­ty – 33 per­cent; Coun­ty gov­ern­ment – 10 per­cent; Man­ag­ing Author­i­ty – 5 per­cent; and Nation­al Research Fund – 2 per­cent. For­est adja­cent com­mu­ni­ties will get an even high­er per­cent­age of 55 per­cent (I wish it was even more!), where­as for range­lands, project man­agers and local com­mu­ni­ties will each get 40 percent.

Embed­ding the community’s share of rev­enue in the law will secure the com­mu­ni­ties’ rev­enue and avoid the cur­rent exploita­tion that they face.

The Gov­ern­ment spon­sored Cli­mate Change Act (Amend­ment) Bill 2023 also secures com­mu­ni­ty share of car­bon rev­enue, though it pegs it at a shame­ful low­er per­cent­age of 25 per­cent. I sug­gest max­i­miz­ing com­mu­ni­ty car­bon rev­enue share with clear safe­guards for inclu­sive benefits.

Indeed, Car­bon off­set­ting equals to bil­lions in rev­enue, mil­lions of green jobs, and a seam­less path out of pover­ty for our com­mu­ni­ties. Tusi­fy­onzwe jameni ! Think green, act green!

About Dr. Kalua Green

He is the Founder and Chair­per­son of Green Africa Foun­da­tion, an orga­ni­za­tion that was found­ed in the year 2000 that cham­pi­ons Sus­tain­able Devel­op­ment in Africa.

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