Rwanda presented its plans for a carbon market framework at the United Nations Climate Conference in Dubai. This ambitious project aims to set up a cap-and-trade system at national level, while deepening its participation in the UN-supported Article 6 market.
International Cooperation and Climate Finance
Developing countries, including Rwanda, are increasingly forging carbon partnerships with developed countries such as Switzerland, Singapore and Japan. These agreements attract foreign capital to support their decarbonization and ecosystem conservation efforts.
Rwanda’s emission targets and financing
Rwanda is committed to reducing its emissions by 7.5 million mtCO2e by 2030, compared with a reference scenario of 12.1 million mtCO2e. These reductions include 3.15 million mtCO2e thanks to national measures and policies, and 4.35 million tCO2e subject to international support. The government plans to raise $11 billion to implement its Nationally Determined Contributions (NDCs), with $4.1 billion in domestic funding and $6.9 billion from the international community.
Principles of the Rwandan Cap-and-Trade System
Rwanda envisages a cap-and-trade system whereby industries will be allocated emissions allowances, with the possibility for those with surpluses to sell their allowances to others exceeding their limits. This provides companies with a financial incentive to reduce their carbon footprint. However, details of participating industries, emissions accounting and monitoring measures have yet to be worked out.
Transparency and Quality of Carbon Credits
Juliet Kabera, Director General of Rwanda’s Environment Management Authority, emphasized that the country’s carbon framework will ensure that every credit purchased in Rwanda is transparent, verified and compliant with international carbon market requirements. Against a backdrop of integrity challenges for the voluntary market, Rwanda is committed to offering high-quality carbon credits.
Article 6 agreements and international cooperation
Earlier this year, Rwanda issued its first Article 6-aligned carbon credits from clean cooking projects. The country is now planning to set up its own national carbon market registry, and has already signed cooperation agreements with Singapore and Kuwait to implement Article 6.
Rwanda’s initiative to establish a carbon market reflects its growing role in the fight against climate change. By skilfully navigating the geopolitics of energy, Rwanda is positioning itself as a key player in the global energy transition, balancing development needs with environmental imperatives.
