By Jerameel Kevins Owuor Odhiambo
Kenya’s carbon market landscape presents a compelling paradox of environmental opportunity shadowed by social justice concerns, revealing the intricate challenges of translating global climate finance mechanisms into equitable local realities. Today, about 59 different carbon credit projects are being implemented in Kenya, generating substantial revenue streams while simultaneously raising fundamental questions about community ownership and participation in climate solutions. The largest is the Northern Rangeland Trust’s (NRT) Northern Kenya Rangelands Carbon Project (NKRCP), which started in 2013 and will be implemented for 30 years, demonstrating the long-term commitment required for meaningful carbon sequestration initiatives.
In 2020, the project reportedly raised 14.6 million US Dollars through carbon credit sales, illustrating the significant financial potential of well-structured carbon initiatives. NRT calls the offset the “world’s largest soil carbon removal project,” and promises that over a 30-year period it will remove 50 million metric tons of CO2 from the atmosphere around three times Kenya’s current total yearly emissions. The scale of these projects underscores Kenya’s strategic position in the global carbon market, where environmental stewardship intersects with economic development aspirations. However, beneath these impressive statistics lies a more complex narrative of community displacement, inadequate consultation, and the commodification of traditional land use practices that have sustained pastoral communities for centuries.
The legal architecture governing Kenya’s carbon markets has evolved rapidly, reflecting both international commitments and domestic policy imperatives that seek to balance environmental goals with economic development. The Climate Change (Carbon Markets) Regulations 2024 which came into force on 17th May 2024 provide technical, regulatory oversight over participation in carbon markets in Kenya, seeking to provide the legal framework for the operation of carbon projects and markets.
After a long period of public consultation and following the enactment of the Climate Change (Amendment) Act in September 2023, the Climate Change (Carbon Markets) Regulations 2024 were gazetted on 17 May 2024. These regulations establish a comprehensive framework for carbon project registration, monitoring, and verification, creating institutional mechanisms for oversight and accountability. The Regulations provide for the setup of a carbon registry that will keep a record of all carbon projects, ensuring transparency and traceability in carbon credit transactions. Kenya is one of only eight African countries that have enacted carbon market regulations, positioning the country as a regional leader in climate finance governance. The regulatory framework incorporates elements of international best practices while attempting to address local contexts and community needs. However, critics argue that the rapid enactment of these regulations, with limited public participation, has created gaps in community representation and meaningful consultation processes.
International legal frameworks provide the foundation for Kenya’s carbon market initiatives, establishing both opportunities and obligations that shape domestic policy implementation and community engagement strategies. As a signatory to the Paris Agreement on Climate Change, Kenya has continued to take notable strides to fulfil its obligations on climate change mitigation, adaptation and finance. The Paris Agreement’s Article 6 mechanisms, particularly the cooperative approaches outlined in Article 6.2 and the sustainable development mechanism in Article 6.4, provide pathways for international carbon trading that Kenya seeks to leverage for climate finance mobilization.
The United Nations Framework Convention on Climate Change (UNFCCC) establishes the overarching principles of common but differentiated responsibilities, recognizing developing countries’ need for financial and technological support in addressing climate change. The Convention on Biological Diversity’s Nagoya Protocol on Access and Benefit-sharing creates additional obligations regarding traditional knowledge and genetic resources, relevant to many carbon projects involving indigenous and traditional communities. The International Labour Organization’s Convention 169 concerning Indigenous and Tribal Peoples establishes standards for free, prior, and informed consent that should guide community engagement in carbon projects. Kenya’s constitution, adopted in 2010, enshrines environmental rights and community land ownership principles that create domestic legal obligations complementing international frameworks. The interplay between these multiple legal instruments creates a complex regulatory environment where international climate objectives must be reconciled with human rights obligations and community autonomy principles.
An original analytical framework emerges when examining Kenya’s carbon markets through the lens of “environmental constitutionalism” a concept that recognizes the constitutional dimensions of environmental governance and the need to balance collective environmental goods with individual and community rights. This framework suggests that Kenya’s carbon market development represents a critical test case for whether constitutional environmental rights can be meaningfully implemented within market-based climate mechanisms without undermining community autonomy and traditional governance systems. The constitutional guarantee of environmental rights in Article 42, combined with community land rights in Article 63, creates a legal foundation for community participation in carbon projects that goes beyond mere consultation to encompass meaningful ownership and decision-making authority.
However, the current regulatory approach, which emphasizes state oversight and Community Development Agreements borrowed from extractive industries, potentially undermines these constitutional principles by treating communities as beneficiaries rather than rights holders. This constitutional-market tension reveals a fundamental challenge in climate governance: how to harness market mechanisms for environmental protection while ensuring that constitutional rights and democratic principles are not subordinated to market efficiency. The resolution of this tension requires developing what might be termed “constitutional carbon markets” market mechanisms that are designed from the outset to respect and reinforce constitutional rights rather than circumventing them through regulatory structures borrowed from other sectors. Such an approach would recognize that effective climate action depends not only on environmental outcomes but also on the legitimacy and sustainability that comes from respecting constitutional principles and community rights. This framework offers a pathway for other developing countries facing similar challenges in reconciling market-based climate mechanisms with constitutional obligations and community rights.
Statistical analysis reveals the stark disparities between carbon market revenues and community benefits, highlighting the urgent need for more equitable benefit-sharing mechanisms and transparent financial reporting. From 2020 to 2023, communities in East Africa experienced the worst drought since the 1980s, yet carbon projects generating millions of dollars have not translated into proportional improvements in community resilience or adaptive capacity. Available data suggests that less than 5% of carbon credit revenues typically reach affected communities directly, with the majority captured by project developers, intermediaries, and government agencies through various fee structures and administrative costs.
The Northern Kenya Rangelands Carbon Project, despite generating $14.6 million in 2020 alone, has been criticized for inadequate community compensation relative to the scale of land use restrictions and traditional practice modifications required. Recent surveys indicate that over 70% of community members in carbon project areas report having insufficient understanding of project terms, benefit-sharing arrangements, and their rights within these agreements. Poverty rates in carbon project areas remain significantly higher than national averages, with pastoral communities showing particular vulnerability to food insecurity and income volatility. Employment generation from carbon projects averages fewer than 2 jobs per 1,000 hectares of project area, far below the labor intensity of traditional pastoral activities. These statistics underscore the critical gap between carbon market potential and actual community development outcomes, suggesting that current models may be perpetuating rather than addressing existing inequalities.
The disenfranchisement of Kenyan communities in carbon credit schemes represents a contemporary form of resource extraction that mirrors historical patterns of dispossession while employing the language of environmental conservation and climate action. Many Kenyans, on whose lands carbon credit projects are being implemented, have no idea what carbon credits and trading are, revealing the fundamental information asymmetries that characterize current project implementation approaches. NRT now manages 43 community conservancies covering 63,000 square kilometers (approximately 24,324 square miles) more than 10 percent of Kenya’s entire land area, demonstrating the massive scale of land use conversion occurring under carbon project frameworks. The displacement of traditional pastoral practices through grazing restrictions and mobility limitations has disrupted centuries-old livelihood systems without providing adequate alternatives or compensation.
The law fails to define a fundamental aspect: carbon rights. These are rights over emissions reductions or carbon removals that can be defined as intangible assets created by legislative and contractual arrangements. This legal omission effectively dispossesses communities of ownership over the atmospheric benefits generated by their land management practices, creating a system where external actors can claim and monetize environmental services without community consent or equitable compensation. The adoption of Community Development Agreements from the extractive industry model further reinforces patterns of external control, treating communities as passive beneficiaries rather than active participants in decision-making processes. Many community members report feeling coerced into project participation through promises of development benefits that have largely failed to materialize, while facing restrictions on traditional practices essential to their cultural identity and economic survival.
Two comprehensive solutions emerge from this analysis that could transform Kenya’s carbon market landscape from a mechanism of disenfranchisement into a tool for genuine community empowerment and climate justice. First, Kenya should establish a Community Carbon Rights Framework that legally recognizes communities as the primary owners of carbon benefits generated from their traditional land management practices, requiring any carbon project to obtain free, prior, and informed consent through traditional governance structures before proceeding. This framework would mandate that at least 60% of carbon credit revenues flow directly to affected communities through transparent, community-controlled funds, while establishing legal mechanisms for communities to terminate or modify project agreements based on their assessment of impacts and benefits. The framework should also create community carbon cooperatives that enable direct participation in carbon markets without intermediary capture, providing technical support and capacity building to ensure communities can navigate market requirements while maintaining autonomy over their participation decisions. Second, Kenya should implement a Climate Justice Impact Assessment requirement for all carbon projects, mandating comprehensive evaluation of social, cultural, and economic impacts on affected communities before project approval.
This assessment would include binding commitments to maintain or improve community welfare indicators, preserve traditional livelihood systems, and respect cultural practices essential to community identity. The assessment process should be community-led, with external facilitation rather than external control, ensuring that community knowledge and priorities guide project design and implementation. Projects failing to meet climate justice standards would be prohibited from receiving carbon credit certification, creating market incentives for genuinely equitable project development. These solutions would transform Kenya’s carbon markets from instruments of extraction into mechanisms of empowerment, demonstrating that effective climate action and social justice are not competing objectives but complementary requirements for sustainable development.
The path forward for Kenya’s carbon markets requires fundamental reconsideration of the relationship between climate finance mechanisms and community rights, recognizing that sustainable climate action depends on social legitimacy and community ownership rather than external imposition. The current trajectory, characterized by rapid regulatory development with limited community participation, risks creating a carbon market system that generates environmental credits while perpetuating social injustices and undermining the very communities whose traditional practices have maintained the landscapes now valued for carbon sequestration. Kenya’s constitutional framework provides a strong foundation for more equitable approaches, but realizing this potential requires political will to prioritize community rights over market efficiency and international recognition over domestic legitimacy.
The experiences of pastoral communities like those in Northern Kenya offer critical lessons about the importance of centering traditional knowledge and governance systems in climate solutions, rather than treating them as obstacles to be overcome or resources to be exploited. The global climate crisis demands urgent action, but this urgency cannot justify the reproduction of colonial patterns of resource extraction disguised as environmental protection. Kenya has the opportunity to pioneer a model of climate finance that demonstrates how market mechanisms can support rather than undermine community autonomy and traditional livelihood systems. Success in this endeavor would not only benefit Kenyan communities but also provide a template for other developing countries seeking to navigate the complex terrain of climate finance while preserving social justice and community rights. The choices made today regarding carbon market governance will determine whether Kenya’s climate finance initiatives contribute to genuine sustainable development or merely create new forms of environmental and social injustice.
The implications of Kenya’s carbon market experiment extend far beyond national boundaries, offering critical insights for the global climate finance architecture and the future of community-centered climate solutions. The challenges and opportunities identified in Kenya’s experience reflect broader tensions within international climate governance between market-based efficiency and rights-based equity, between global environmental goods and local community needs, and between rapid climate action and meaningful participation. As carbon markets expand globally, the Kenyan case demonstrates the urgent need for international standards that prioritize community rights and benefit-sharing rather than simply focusing on environmental additionality and cost-effectiveness.
The role of international buyers in these markets becomes crucial, as their purchasing decisions can either incentivize equitable project development or perpetuate extractive practices through demand for cheap credits regardless of social impacts. Kenya’s regulatory evolution also highlights the importance of learning from other sectors, particularly the lessons from extractive industries about the limitations of Corporate Social Responsibility approaches and the need for legal frameworks that recognize community ownership rather than treating communities as stakeholders to be managed.
The success or failure of Kenya’s approach to balancing climate finance with community rights will significantly influence how other African countries develop their own carbon market regulations and how international carbon market standards evolve to address social safeguards. As climate finance flows increase and carbon markets mature, Kenya’s experience serves as both a cautionary tale about the risks of prioritizing market development over community rights and a potential model for how constitutional principles and traditional governance systems can be integrated into market-based climate mechanisms to create more just and sustainable outcomes.
As Kenya’s carbon market story continues to unfold, the fundamental question remains whether market-based climate solutions can be designed and implemented in ways that genuinely serve both environmental and social justice objectives, or whether these goals are inherently in tension within current global economic structures. Kenya stands at a crossroads. With carbon markets expanding, the question is not whether to trade carbon – but who gets to decide, how, and who benefits. The answer to this question will determine not only the fate of Kenya’s pastoral communities and their traditional landscapes but also the broader trajectory of global climate finance and its relationship to human rights and social equity. The integration of constitutional environmental rights with market mechanisms represents an ongoing experiment in democratic climate governance, one whose outcomes will reverberate across the developing world as countries seek pathways to climate resilience that do not sacrifice community autonomy or social justice on the altar of market efficiency.
As philosopher Rob Nixon observed in “Slow Violence and the Environmentalism of the Poor,” “the environmentalism of the poor is particularly attentive to what I call ‘resource rebels’ collective campaigns that target the forces of displacement that leave communities resource-stripped.” Kenya’s carbon market development must grapple with this insight, ensuring that climate finance mechanisms support rather than undermine the environmental knowledge and practices of the communities whose stewardship has maintained the landscapes now valued for their carbon storage potential.
The writer is a lawyer and legal researcher.
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