The government has unveiled the proposed Carbon Trading Bill 2023 in bid to address the pressing challenges of climate change and its impact on the environment.

The bill aims to establish the Carbon Trading And Benefits Authority (CTBA) and the Carbon Trading Tribunal (CTT) to regulate and facilitate carbon trading within the country.

“This is a new legislative proposal that seeks to provide for the establishment of a regulatory framework for the trading of carbon credits,” the draft proposal reads.

Under the new framework, businesses and industries will be required to obtain carbon trading permits at a nominal cost of Sh1000 each, with the authority projecting to earn an estimated Sh65 million in annual revenues.

“The authority therefore will generate revenue through issuance of carbon trading permits to a person or company that intends to carry out carbon trading business in Kenya,” said the Bill drafted by MP Joseph Lekuton.

Massive potential

Despite the market being estimated to be worth Sh70 billion by 2030, unfortunately, last year Kenya issued carbon permits for a mere 4.3 tonnes of carbon worth Sh87 million.

The Bill therefore comes as a proactive response to the escalating concerns surrounding greenhouse gas emissions and their detrimental effects on the environment.

The bill aligns with the country’s commitment to the Paris Agreement, striving to reduce carbon emissions and transition towards a low-carbon economy.

Its key functions will include the issuance and monitoring of carbon trading permits, setting emission limits for businesses, and enforcing compliance with carbon reduction targets.