Kenya's Carbon Trading Regulations 2025: What the Final Piece of the Framework Means for the Market

The framework is now complete

When Kenya gazetted the Climate Change (Carbon Markets) Regulations 2024, it established the project authorisation pathway — how carbon projects get approved, how credits get issued, and what community benefit-sharing looks like. What the 2024 Regulations did not fully address was the mechanics of trade itself: who can buy and sell, on what terms, through which platforms, and under what rules.

The Climate Change (Carbon Trading) Regulations 2025 answered those questions. Together with the 2024 framework, they give Kenya what very few African countries have: a complete, end-to-end regulatory architecture for a domestic carbon market. Africa's first. And increasingly, a model that other jurisdictions are watching.

What the Trading Regulations actually govern

Think of the distinction this way. The 2024 Regulations governed the lifecycle of a carbon credit — from project concept through verification to issuance on the National Carbon Registry. The 2025 Trading Regulations govern what happens to that credit after it exists: who can trade it, through which channels, at what price discovery mechanisms, and with what oversight.

Key provisions include licensing requirements for carbon market intermediaries and brokers, rules governing spot transactions (immediate delivery of credits) and forward contracts (delivery at a future date), price discovery and reporting obligations to ensure market transparency, conduct standards for market participants, and NEMA's oversight role as market regulator alongside the Capital Markets Authority for any exchange-listed carbon instruments.

This is not bureaucratic paperwork. It is the infrastructure that makes carbon credits investable — not just certifiable.

Why this matters for project developers

For the carbon project developers we work with across Kenya and East Africa, the Trading Regulations change the commercial environment in two fundamental ways.

First, they create a defined buyer-side market. Previously, selling credits meant navigating informal over-the-counter arrangements with international buyers under limited local oversight. The Trading Regulations establish the rules under which Kenyan credits can be traded domestically, creating the conditions for a local price discovery mechanism and reducing dependence on international voluntary market fluctuations.

Second, they create compliance obligations for intermediaries. If you are a broker, an advisory firm earning fees on carbon transactions, or a platform facilitating trades, you now need a licence. That is a cost and a barrier — but it is also a filter that removes the informal and often predatory intermediation that has historically disadvantaged communities in Kenya's carbon market.

The Article 6 connection

None of this operates in isolation from Kenya's international obligations. The Trading Regulations sit within Kenya's broader Article 6 framework, which governs when corresponding adjustments are required for credits transferred internationally. Credits traded domestically without international transfer do not require a corresponding adjustment. Credits sold to foreign buyers — government or private — do.

NEMA's National Carbon Registry tracks every trade and flags when a credit is being positioned for international transfer, triggering the Letter of Authorisation process under the 2024 Regulations. The two instruments are designed to work together.

What the market looks like in practice

Kenya's carbon market in 2027 is not yet a liquid exchange. It is a bilateral, brokered market operating under new regulatory supervision. The Trading Regulations have not created a carbon exchange overnight — but they have created the legal foundation for one, and several initiatives are exploring how exchange infrastructure could be layered on top of the National Carbon Registry.

For international investors looking at Kenyan carbon credits, the regulatory picture is now cleaner than almost any other African jurisdiction. Credits issued under the National Carbon Registry framework, traded under the 2025 Regulations, carry a level of regulatory backstop that voluntary market credits in less regulated environments simply cannot match.

3 things to do now

1. If you are a project developer, ensure your credits are registered on the National Carbon Registry and that your sales agreements reflect the new trading framework requirements — including the distinction between domestic trades and internationally transferred units.

2. If you are buying Kenyan carbon credits for compliance or voluntary purposes, confirm that your counterparty is operating under the 2025 Trading Regulations and that any broker in the transaction holds the appropriate licence.

3. If you are advising on carbon transactions or earning fees from carbon market activity, assess whether your activities require a trading intermediary licence under the new framework.

*Ardena Consulting advises project developers, buyers, and investors on Kenya's carbon market regulatory framework, Article 6 compliance, and credit origination strategy. Contact us to discuss your position in the market.*