Kenya Electricity Generating Company (KenGen) is set to benefit from its Clean Development Mechanism (CDM) Projects further giving impetus to the company’s efforts to combat climate change.
This follows the issuance of additional 309,495 Certified Emission Reductions (CERs) for the organization’s Olkaria II CDM Project by the United Nations Framework Convention on Climate Change (UNFCCC), bringing the total amount of issued carbon credits to 550,981.
Since KenGen started registering its projects in 2010, it has recorded about Ksh.388 million in carbon revenue so far.
And now, the Nairobi Securities Exchange (NSE) listed firm will earn about Ksh.119 million from the 550,981 carbon credits issued so far.
Speaking on the issuance of the CERs, KenGen Managing Director and CEO, Mrs. Rebecca Miano said climate change has become one of the biggest global environmental challenges and has created an urgent need for mitigating against its effects.
“KenGen has a dedicated team to spearhead environmental sustainability and contribute to the reduction of the effects of climate change. So far, we have developed and registered six CDM projects comprising of Olkaria II Geothermal Expansion Project, Redevelopment of Tana Hydro Power Station Project, Optimisation of Kiambere Hydro Power Project, Olkaria IV Geothermal Project, Olkaria I Units 4&5 Geothermal Project and Ngong Wind,” she said.
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These projects contribute to off-setting on an annual basis 1.5 million tonnes of Carbon Dioxide equivalent annually. Out of this, 550,981 Tonnes of carbon dioxide has already been issued by the UNFCCC and are now available for sale.
The sale process has been initiated as guided by the applicable disposal laws and regulations for the public sector organizations.
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The company made a milestone in June this year when it joined a United Nations-backed emissions-reduction program as it looks to begin a domestic carbon market.
“Our intention is to be able to sell the Certified Emission Reductions in the market by December 2021, depending on demand,” said Miano.
The Capital Markets Authority (CMA) and the NSE held talks with KenGen to start carbon trading on the derivatives segment of the market this year.
KenGen has the capacity to generate 1,803 megawatts of electricity, almost two-thirds of Kenya’s installed capacity. Of that, 705.5 megawatts is geothermal energy produced by the company.
The CDM projects contribute to national sustainable development by providing clean energy which ensures improved environmental quality, positive health impacts and increased productivity.
CDM was developed as part of the output of global concern to contribute to climate change mitigation and to foster sustainable development for non-industrialized countries.
KenGen has been focusing on the production of green energy and currently, more than 86 percent of the energy produced by the company is from clean sources namely wind, hydro and geothermal.
To enhance its portfolio of climate change, KenGen intends to incorporate additional geothermal, wind and solar projects which will reduce between 100,000 to 600,000 carbon emissions every year.
Under the project, the company commits to emission-reduction targets through investments in green and clean energy to help combat global warming, as per the 2015 Paris Agreement guidelines.
Six of KenGen’s projects, including geothermal, hydro and wind power plants, are registered under the CDM, from which the UN aims to allow projects in developing countries earn emission-reduction credits.