EfD researchers have found that carbon markets deliver impacts beyond emissions reduction. They distinguish between direct, indirect, and incidental effects. Direct impact is reduced greenhouse gas emissions, while indirect impacts include social and economic benefits such as improved livelihoods, income generation, and job creation. Incidental impacts reflect unintended outcomes arising from project implementation.
The findings showed that carbon projects in Kenya, particularly in afforestation, reforestation, and clean energy, are generating significant benefits while also presenting some trade-offs. They improve health outcomes, create income opportunities, and support investments in education, water, and local infrastructure, while contributing to forest restoration, reduced deforestation, and enhanced biodiversity.
However, challenges remain, including land-use conflicts and potential livelihood impacts for those reliant on traditional energy sources. Emerging risks such as e-waste from renewable technologies also highlight the need for stronger planning and governance to ensure sustainable outcomes.
The researchers also noted that most carbon credits in Kenya come from nature-based projects, even though energy projects are increasing in number. The research was discussed in a validation workshop that took place on 26 February 2026 in Nairobi.
Coordination challenges in the Kenyan carbon market
The study further examined the institutional landscape shaping carbon markets in Kenya, revealing a complex system involving government agencies, private developers, community organizations, and international actors. While this diversity reflects a growing and dynamic sector, it also presents coordination challenges.
Key issues include overlapping mandates between national and county governments, unclear carbon ownership, and lengthy approval processes, up to 18 months. In addition, policies are not aligned across sectors such as land, agriculture, and water, which continue to limit effective implementation of carbon projects.
Stakeholders highlight gaps and concerns
During the discussion, participants raised several practical concerns based on their experience in the sector.
“We don’t have adequate sectoral emissions data, and that makes planning difficult,” lavelyne Muthini, a carbon market consultant noted.
Participants also pointed out that waste management is not yet well captured in carbon market discussions, despite its potential to contribute to emissions reduction.
Capacity constraints were another concern. Stakeholders highlighted the lack of local verifiers and validators, which increases reliance on international expertise and raises the cost of carbon projects.
Policy-related concerns also emerged, particularly around emerging signals that could affect investment.
“There are concerns that taxing machinery for direct carbon capture could increase costs and affect investment in this space,” one participant said.
Including communities is central
The discussions also emphasized the central role of communities in Kenya’s carbon market. Communities are directly involved in project implementation and benefit from carbon revenues and related development investments.
However, challenges remain around awareness, engagement, and benefit-sharing.
The workshop also explored the role of youth in the carbon market. While this remains an emerging area, examples were shared showing that clean cooking and energy projects are already creating opportunities for youth participation.
“We are seeing youth getting involved, especially in clean cooking technologies through distribution, sales, and local implementation,” Magdalene from the Ministry of Environment and Climate Change noted.
By Jane Maina