Carbon Trading in Kenya: Challenges and Opportunities
DOI:
https://doi.org/10.47941/je.2525Keywords:
Carbon Trading, Challenges, Opportunities, Climate Change Mitigation, Carbon Markets.Abstract
Purpose: The purpose of the study is to assess the current status of carbon trading in Kenya, identify the challenges inhibiting its growth, and evaluate the opportunities it presents for economic and environmental progress.
Methodology: A mixed-methods approach was adopted, combining qualitative interviews with key stakeholders, such as policymakers, carbon project developers, and local community representatives, along with a quantitative analysis of carbon market trends and project performance data.
Findings: The findings reveal significant barriers to the effective implementation of carbon trading, including weak regulatory frameworks, limited awareness among local communities, inadequate technical expertise, and challenges related to accessing international carbon markets. Despite these obstacles, the study highlights substantial opportunities, such as leveraging Kenya's abundant renewable energy resources, enhancing community participation in carbon offset projects, and tapping into global demand for certified emissions reductions.
Unique Contribution to Theory, Policy and Practice: The study concludes that while carbon trading in Kenya remains underdeveloped, it holds considerable potential to contribute to climate resilience and economic growth if systemic barriers are addressed. Key recommendations include strengthening policy and institutional frameworks, enhancing capacity-building initiatives, improving access to financing for carbon projects, and fostering public-private partnerships to scale up investments in carbon trading. By addressing these challenges, Kenya can position itself as a leader in sustainable carbon market practices in Africa.
Downloads
References
Adenle, A. A. (2020). Assessment of solar energy technologies in Africa-opportunities and challenges in meeting the 2030 agenda and sustainable development goals. Energy Policy, 137, 111180.
Bansal, S., Mukhopadhyay, M., & Maurya, S. (2023). Strategic drivers for sustainable implementation of carbon trading in India. Environment, Development and Sustainability, 25(5), 4411-4435.
Battocletti, V., Enriques, L., & Romano, A. (2024). The voluntary carbon market: market failures and policy implications. U. Colo. L. Rev., 95, 519.
Bayer, P., & Aklin, M. (2020). The European Union emissions trading system reduced CO2 emissions despite low prices. Proceedings of the National Academy of Sciences, 117(16), 8804-8812.
Betz, R., Michaelowa, A., Castro, P., Kotsch, R., Mehling, M., Michaelowa, K., & Baranzini, A. (2022). The carbon market challenge: preventing abuse through effective governance. Cambridge University Press.
Blum, M. (2020). The legitimation of contested carbon markets after Paris–empirical insights from market stakeholders. Journal of Environmental Policy & Planning, 22(2), 226-238.
Chisadza, C., Djokoto, J. G., & Benos, N. (2021). Carbon Pricing and Industrial Emissions in Sub-Saharan Africa. Energy Economics, 96, 105170.
Clifton, S. J. (2024). An Analytical Review of Carbon Trading Mechanisms in Kenya: Challenges and Opportunities. Journal of Integrative Biological and Medical Sciences, 12(2), 1-13.
Espelage, A., Ahonen, H. M., & Michaelowa, A. (2022). The role of carbon market mechanisms in climate finance. In Handbook of International Climate Finance (pp. 352-378). Edward Elgar Publishing.
Fonacier, R. T. M. A., & Nordbotten, S. Ø. (2024). Market Spillovers in the EU Emissions Trading System and Energy markets: A Connectedness Approach (Master's thesis, University of Agder).
Jaspal, M. (2023). Towards effective carbon trading markets for emerging economies: The evolving indian experience. Observer Research Foundation, 9, 95.
Kipkemboi, C. P., Lawrence, A. M., Omuse, O. D., & Kipkorir, K. W. (2024). Successes and Pitfalls of Global Climate Regimes in Kenya: Insights on Kyoto Protocol and Paris Agreement.
Lu, J., Gulzar, F., & Lai, Y. (2024). Exploring the intersection between sustainable finance and achieving carbon neutrality in the transportation sector. Heliyon, 10(15).
Otundo Richard, M. (2024). Adapting the EU Emission Trading System to Kenya: Assessing Socioeconomic Impacts and Policy Feasibility for Carbon Management. Adapting the EU Emission Trading System to Kenya: Assessing Socioeconomic Impacts and Policy Feasibility for Carbon Management (August 25, 2024).
Paaso, K. (2020). The industrial perspective of EU Emissions Trading System: case Outokumpu Tornio Works (Bachelor's thesis, K. Paaso).
Pan, C., Shrestha, A., Innes, J. L., Zhou, G., Li, N., Li, J., ... & Wang, G. (2022). Key challenges and approaches to addressing barriers in forest carbon offset projects. Journal of Forestry Research, 33(4), 1109-1122.
Park, S. J. (2021). How South Korea Can Improve Carbon Market: The Importance of Economic Incentives and International Cooperation in the Fight against Climate Change. Emory Int'l L. Rev., 35, 485.
Qadir, S., & Dosmagambet, Y. (2020). CAREC energy corridor: Opportunities, challenges, and IMPACT of regional energy trade integration on carbon emissions and energy access. Energy Policy, 147, 111427.
Raufer, R., Coussy, P., & Freeman, C. (2022). Emissions trading. In Handbook of climate change mitigation and adaptation (pp. 3237-3294). Cham: Springer International Publishing.
Rickels, W., Proelß, A., Geden, O., Burhenne, J., & Fridahl, M. (2021). Integrating carbon dioxide removal into European emissions trading. Frontiers in Climate, 3, 690023.
Shikumo, D. H. (2024). Carbon Finance Readiness: A Review of Institutional Frameworks and Policies in Kenya. African Journal of Emerging Issues, 6(14), 64-81.
Tumushabe, J. T., Turyasingura, B., & Chavula, P. (2023). The sustainability of carbon markets for climate-smart agriculture among smallholder farmers in Uganda. Asian Journal of Research in Agriculture and Forestry, 9(4), 337-345.
UNEP. (2021). Carbon Markets and Africa: Challenges and Opportunities. Nairobi: United Nations Environment Programme.
UNFCCC. (2020). CDM Project Activities by Host Party. Retrieved from https://cdm.unfccc.int/Statistics/Public/CDMinsights/index.html
UNFCCC. (2020). State and Trends of the Carbon Market 2020. Bonn: United Nations Framework Convention on Climate Change.
Wanyonyi, S. A. (2020). The Acceptability of the Use of Carbon Taxes for Climate Change Mitigation in Kenya: a Political Economy Assessment (Doctoral dissertation, University of Nairobi).
World Bank. (2022). State and Trends of Carbon Pricing 2022. Washington, DC: World Bank.
Ying, J. J., & Sovacool, B. K. (2021). A fair trade? Expert perceptions of equity, innovation, and public awareness in China’s future Emissions Trading Scheme. Climatic Change, 164(3), 31.
Zhao, S., Wang, M., Chen, L., & Li, J. (2024). Economic Incentives for Pollution Control in China Through the Lens of the Carbon Trading Market and Its Effectiveness and Challenges. Law and Economy, 3(3), 50-54.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Dr. Abdirizak Arale Nunow
This work is licensed under a Creative Commons Attribution 4.0 International License.
Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution (CC-BY) 4.0 License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this journal.
