Carbon Credits for Off-grid Solar in Sub-Saharan Africa

Lessons from Energy-access Companies in the Voluntary Carbon-credit Market

Power Africa is a collaborative initiative led by the United States Government in conjunction with African governments, privatesector organizations, and multilateral institutions. Power Africa’s goal is to increase electricity access by adding 30 megawatts of new generation capacity, and 60 million new connections through on- and off-grid solutions by 2030. Power Africa defines energy “access” as the number of new households and businesses connected to electricity through an on- or off-grid power source. This paper offers insights for off-grid solar companies keen to explore the voluntary carbon market. The paper builds on the technical assistance with carbon credits that Power Africa and CarbonClear provided to two off-grid companies.

This resource also draws on CarbonClear’s experience of working with more 20 solar companies to evaluate the opportunity and risks of implementing a carbon-credit program. By focusing on sub-Saharan Africa, this paper examines some of the obstacles that solar companies face and explores effective carbon-credit strategies to navigate this market successfully. The voluntary carbon market (VCM) is an evolving mechanism that enables an entity to offset its greenhouse-gas emissions by purchasing carbon credits from emission-reducing projects. Although Africa holds significant potential for climate finance and sustainable development, it currently composes only a small portion of the global VCM.

One initiative to expand Africa’s share of the carboncredit market is the Africa Carbon Markets Initiative. Launched in 2022, the Africa Carbon Markets Initiative aims dramatically to scale voluntary carbon markets across Africa by producing 300 million credits annually by 2030, unlocking $6 billion in income, and supporting 30 million jobs.1

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