Malawi has created an agency to oversee its trade and marketing of carbon emission offsets, President Lazarus Chakwera said.
“Using the prevailing global market prices, the potential value of Malawi’s carbon credits is estimated at 19.9 million metric tons of carbon per annum, valued at over $600 million,” Chakwera said at the inauguration of the Carbon Marketing Initiative on Friday.
Malawi’s announcement is the latest attempt by an African government to profit from the growing trade in offsets. Zimbabwe this year decreed that the state will get half the proceeds of any carbon credit programs while Kenya is putting in place regulation to oversee the trade.
One carbon credit represents a ton of planet-warming carbon dioxide or carbon dioxide equivalent either removed from the atmosphere or prevented from entering it in the first place. The offsets are bought by emitters to mitigate the effects of their activities.
Malawi’s agency will collate an inventory to establish a national carbon registry, said Macdonald Mafuta Mwale, secretary to the Treasury. It will also will seek to find carbon credit opportunities as well as marketing and trading the securities. It has hired Switzerland’s Klik Foundation to help it assess carbon opportunities and issue internationally tradable credits.
The country signed a memorandum of understanding at the event with a Kenya-based company, Koko Networks, which sells carbon credits as part of its business of selling clean-burning bio-ethanol cook-stoves. The stoves displace the use of charcoal and wood for cooking, reducing greenhouse gas emissions.
Koko is “exploring the potential to build a bioethanol utility in Malawi,” Greg Murray, a co-founder of Koko and the company’s chief executive officer, said in a response to queries.
“We are encouraged by the creation of a national carbon strategy and policy in Malawi,” he said. “This is one of the areas that governments need to get right to unlock international private climate finance.”
(Updates with Koko CEO comments in last two paragraphs)