The presentation, delivered by Andrea Abrahams, Managing Director, Voluntary Carbon Markets at the International Emissions Trading Association (IETA), explored challenges and opportunities within the carbon credits markets for oil and gas companies operating in Africa.

“With such a growing energy demand, the growth potential for the carbon credits market in Africa is acute, considering the continent has to achieve both energy security and emissions reductions,” she said.

Commenting on best practices for Africa to enhance the market, Abrahams added that “A lot of countries and companies need to get involved, there are many long-term investors supporting oil and gas projects and seeking partnerships.”

She emphasized the need for African countries to accelerate the implementation of emission reduction training and pricing schemes, as well as the need to maximize awareness programs across both the public and private sector to enhance the industry.

“Ideally the oil and gas industry should get together and agree on what net zero will look like, the path to follow and methodology, how much needs to be reduced per year, and get rid of the noise which is currently dominating the global energy sector for a just and inclusive transition,” noted Abraham.

She urged both private corporates and government agencies to maximize the development of clear net-zero pathways for oil and gas operations, offsetting and SDG strategies, the quality of carbon credits standards and mechanisms, while ensuring cooperation with local partners is prioritized to guarantee local content development and environmental, social and governance to be able to attract investors for emissions reductions mechanisms.

The presentation also explored Africa’s response towards carbon credits and programs currently underway across the continent to enhance the industry, stating that “The voluntary carbon market (VCM) will be crucial going forward with South Africa leading with its Carbon Pricing Scheme. VCM is unregulated and presents an opportunity for Africa to implement carbon emissions reductions projects without a lot of national or global policy interventions. VCM is bringing finance from the private sector into African countries, which would otherwise not be there and helping fill a market void with more African countries participating in the sector than in the compliance market.”

Up to ten African countries are already participating in the VCM sector, according to Abraham.

She added that government to government schemes and government to private sector projects will also be crucial to advancing the sector with Ghana and Switzerland, for instance, piloting buying and selling emissions reductions units to reduce emissions as part of Article 6.2 of the Paris Agreement.

With countries such Kenya, Ghana, Ethiopia, Malawi, Tanzania and Mozambique currently piloting carbon reductions mechanisms, on the role of carbon credits on advancing Africa’s energy security and sustainability agenda, she said “Even with 100% delivery of national NDCs we have a gap to deliver the 1.1 degrees target. We have a massive task in our hands to not only just map what net zero will look like but to also deliver it. We need all tools on the table including carbon pricing which have over the past 30 years grown and delivered real measurable reductions in emissions.”

Abraham highlighted the impact of carbon credits in accelerating the development and exploitation of low-carbon energies and clean cooking solutions including renewables and natural gas across the continent.

In regards to the key challenges hindering the industry, Abraham identified the financing, policy and implementation gap as the main disruptor of the sector.

AEC’s African Energy Week (AEW) conference and exhibition – Africa’s premier event for the energy sector – which will take place from 16 – 20 October in Cape Town, will discuss Africa’s carbon credits markets and its role in advancing the exploitation of the continent’s oil and gas resources to address looming energy poverty and drive socioeconomic developments and environmental sustainability.