Kenya has passed a new Climate Change Act, which will establish the country's involvement in international carbon markets. The amended Act is a prerequisite for Kenya's involvement in activities under Article 6 of the Paris climate agreement, which allows for bilateral trade of carbon credits between host and buyer countries or a global carbon credit trading mechanism.
The cabinet secretary of the environment ministry can enter into bilateral or multilateral agreements to trade carbon for emissions reductions and removals, and may also enter agreements with private entities to offset carbon emissions. The new law also assigns the secretary new responsibilities, such as advising on the carbon budget for trading and approving international transfers of mitigation outcomes (ITMOs) and emissions reduction.
The secretary will also approve the measurement, reporting, and verification of greenhouse gas emissions and appoint the designated national authority for market mechanisms. The new law strengthens Kenya's climate change directorate's position in oversight and decision-making and introduces the concept of a "community development agreement", where land-based projects share at least 40% of their combined earnings with the community. However, the law is vague on certain issues, and the lack of cross-ministerial decision-making bodies may cause friction with other ministries, such as the ministry of transport.