Economic insights
Fuelling Africa's infrastructure growth: alternative funding
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Africa
Climate change
Africa still holds a sizable portion of the world's remaining forests which are still under threat of being eradicated to pave the way for commercial and non-commercial human activities. Tanzania, like other African countries has embraced the establishment and development of carbon projects, which includes enactment specific legislation on carbon projects. Most Tanzania carbon projects are nature based i.e. maintaining of existing forests and planting of trees/creation of forests for purposes of obtaining carbon credits for sell. However, there are other means of implementing carbon projects and earning carbon credits for sell which we need to embrace.
Persons who shift from using nonrenewable energy to renewable energy reduce their carbon print which warrants them to receive carbon credits. For example, tower and mobile network operator companies (MNOs) have ordinarily relied on the national grid for power but have traditionally connected to backup generators as an alternative source of power if the national grid power is not available. For sites which are off the grid, it was standard practice to use generators to supply power to such sites throughout their lifespan. Taking into consideration that there are thousands of towers within Tanzania itself, such generators release carbon emissions which have negative effects to the environment. As of recent, there has been a shift to installing solar equipment to provide backup power as opposed to generators. This has the effect of substantially reducing the MNOs and tower companies’ carbon footprint. Accordingly, such projects may register for carbon projects and gain carbon credits for sell or utilization in other sites.
Traditionally in Tanzania, waste management companies collect waste from persons’ homes and offices and discharge / dump such waste at designated locations. Such waste overtime release hazardous gases to the environment which has negative impact to the environment and the communities surrounding such dump sites. There is still a low number of persons who have adopted the recycling or use of waste in a manner which reduces the hazardous emissions. Such waste can be used to generate renewable energy, and creation of other materials through recycling e.g. building materials, clothes, etc. Aside from selling the generated power or the created materials, the persons doing such projects out of waste are entitled to register for carbon projects and sell such credits for an additional financial gain.
In large parts of villages in Tanzania, most residents still use firewood and charcoal as the primary source of heat for cooking food. The Government is still implementing mechanisms and puts efforts to urge the use of environmental friendly cooking methods as opposed to use of charcoal and firewood. Whilst most of these areas are off the grid, renewable energy and use of gas remain as the only source for heat necessary for meals preparation. Villages or entities which manage to eradicate the use of firewood and charcoal in such local communities and adopt alternative means for cooking would play a great role to considerably reduce carbon emissions to the environment. Such entities or Villages would be eligible for registration of carbon projects and gain carbon credit for sell.
Direct air capture (DAC) are technologies which are used to capture CO2 emissions from the air, but are costly to scale and have not been properly certified to international standards. There are upcoming projects which once certified may play a major role in reducing carbon emissions and qualify to be registered as a carbon credit in Tanzania and obtain carbon credits which may be traded for a financial gain.
Government Gazette GN. 636 of 2022 published the Environmental Management (Control and Management of Carbon Trading) Regulations (the Regulations). The Act and the Regulations provide specific information and steps for registering a carbon project and obtaining carbon credits. It is important to note that, carbon projects and carbon credits do not operate retrospectively meaning the gaining of credits will arise after registration.
If you have any questions about any of the themes raised in this insight or would like to learn more about Tanzania’s Carbon Trading Regulations, please contact Amalia Lui.
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