Are carbon markets a fossil fuels trap for Africa?

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OPINION

By Patrick Edema

I recently participated in one of the pre-Africa Climate Summit (ACS) sessions in Addis Ababa, Ethiopia. The discussions centred around building a public finance agenda for Africa’s just energy and climate-resilient future. During the discussions, issues of carbon markets as false solutions to climate mitigation in Africa also came up.

Although I did not have enough understanding of what carbon markets are and how they work, this became part of my homework. And my reason for researching and understanding more about carbon credits is very clear: oil and gas activities in Uganda are already ongoing, and such initiatives should already be in existence.

These carbon markets are trading systems that allow countries, companies, or entities to buy and sell “carbon credits”, which represent claimed reductions or removals of greenhouse gas emissions. The underlying concept is that one party can emit more carbon dioxide if another party emits less, by purchasing credits representing the difference. These markets are either compliance-based, which are regulated by governments or voluntary, which are often led by corporate initiatives.

It is clear that these carbon markets were born out of a misleading but undeniably appealing idea. Instead of forcing every emitter to cut emissions at the source, why not allow those who can purchase the right to pollute from those who have reduced or absorbed greenhouse gases elsewhere? In practice, these systems issue carbon credits, each theoretically representing one metric ton of carbon dioxide either avoided or removed.

Thus, a company that cannot easily or doesn’t want to decarbonise its own operations buys these credits and claims the corresponding emission reductions as its own, an arrangement that, on paper, promises a cost-effective, market-driven path to climate mitigation.

Under regulated, or compliance-based, schemes, such as the European Union Emissions Trading System (EU ETS), governments impose a cap on total emissions and distribute allowances accordingly. Industries that clean up can sell their surplus permits to those lagging behind.

This is what I understood about carbon markets and carbon credits. They are not a real climate solution. They are more accurately characterised as pollution permits that allow the wealthy to keep polluting under the illusion of environmental responsibility. Created by a technocratic elite, this system commodifies avoided or stored carbon and transfers control over Africa’s land and resources to global and local elites. Instead of empowering communities, it benefits corporations and governments most responsible for the climate crisis, reinforcing existing inequalities.

Rather than cutting emissions, carbon markets enable corporate greenwashing and the outsourcing of climate responsibilities to the Global South. Instead of driving fundamental changes in how we produce energy, manufacture goods, or move people, carbon markets create a shortcut where companies can continue burning fossil fuels so long as they fund projects elsewhere, whether it’s protecting tropical forests, installing cook stoves in rural communities, or deploying nascent carbon-capture technologies.

This distracts from the urgent need to cut emissions at source and delays the global energy transition. Companies use these credits to claim to be “net zero” while continuing or even expanding harmful and polluting activities.

Initiatives like the African Carbon Markets Initiative (ACMI) could allow 1.5 to 2.5 gigatonnes of new emissions annually, more than all current fossil fuel and agricultural emissions in Africa combined, undermining global climate goals and burdening the Global South with the costs.

Africa deserves genuine investment in zero-carbon development, but not through schemes that justify continued emissions elsewhere. Real emissions reductions in Africa must be recognised as African contributions, not used to offset corporate pollution. Anything less is a dangerous form of climate neo-colonialism that prioritises carbon accounting over African lives, rights, and development. Carbon markets are a tool to allow the continuation of emissions rather than their elimination. Instead of prioritising real emission reductions, they offer a financial loophole for wealthy nations.

Instead of relying on scaling carbon markets, African countries should prioritise direct, equitable, and accountable climate finance mechanisms that address the continent’s unique challenges and promote justice. For instance, African nations must intensify efforts to secure increased international climate finance from wealthy, industrialised countries, rooted in the principle of historical responsibility for climate change. This funding should primarily take the form of grants and direct budget support rather than loans or offset-based mechanisms that risk indebting already vulnerable economies.

Such finance should focus on supporting public-sector-led climate adaptation and mitigation projects that prioritise the needs of marginalised communities, build resilient infrastructure, and strengthen public health and disaster preparedness systems. By promoting public finance, African countries can retain sovereignty over climate actions and ensure that funds are aligned with national development goals.

Therefore, I believe these carbon Markets are a failed model of climate finance that prioritises profits over people and delays over action. They have not worked in the past and are unlikely to deliver the promised development benefits for Africa. They are based on flawed scientific and economic assumptions, encourage pollution outsourcing, and open the door to land grabs, corruption, and greenwashing.

Africa deserves real climate solutions, not more broken promises. African governments must reject carbon markets expansion and instead pursue direct, just, and locally grounded approaches to climate finance and development that deliver real benefits to people. The path forward must be rooted in equity, sovereignty, and real emissions reductions, not pollution permits.

The writer is an environmental engineer

epatrick60@gmail.com