Recent events in Kenya, including the closure of KOKO Networks, a high-profile clean-cooking company, have raised questions about whether carbon credits can finance and deliver clean-cooking appliances to households across the continent.
The reality is that there is currently no better mechanism to deliver clean cooking solutions to Sub-Saharan Africa’s 1.2 billion people.
Clean cooking in Africa does not have a technology or an adoption problem. It has an affordability problem, and carbon finance remains the most viable solution to solve it at scale.
Why? Because carbon credits can discount the upfront cost of a clean cooking appliance by 50-90%.
Can the rural poor afford a $50 cookstove? No.
Can they afford a $50 stove discounted to $3? In most cases, yes.
While it would be nice if governments could fund this, it's highly unlikely, as it would cost ~$10 billion of tax receipts to deliver clean cooking to every household on the continent.
Fortunately, carbon finance provides the upfront discount as well as generating additional revenue from the sale of the credits that can be reinvested into making even more cooking appliances. This lowers the $10 billion government expenditure to a $3 billion upfront investment of private or public capital, which has the potential to generate 10X above that in revenue.
This revenue can be used to develop Africa. Agreements have already been signed between project developers and national governments to share this carbon revenue. Over the lifetime of the project, this can be tens of millions of dollars.
Carbon finance, done right, is the ultimate win-win-win. Households get a life-saving clean cooking product they could never otherwise afford; governments increase their coffers as opposed to having them drained by subsidies; and billions of dollars of new investment and revenue from carbon sales come to the continent.
Even better is when carbon projects are funded by public investment capital, such as a recent deal struck by the Trade Development Bank, with support from World Bank Ascent, that utilizes carbon credits to subsidize the cost of clean cooking. The sale of the credits will be used to repay the debt, which will then be used to subsidise more stoves, ensuring more of the capital stays on the continent.
So yes, in fact, carbon finance for clean cooking remains the best and only way to scale clean cooking.
The good news is that, even though the carbon markets were in the doldrums for the last 2 years, at the end of 2025, we saw two game-changing developments in the carbon market: the formalization of ‘compliance’ markets such as CORSIA and the first issuance of high-integrity “CCP” voluntary credits for cookstoves. ‘CCP’ credits have received the ‘Core Carbon Principles’ label for integrity as defined by the Integrity Council of the Voluntary Carbon Market (ICVCM). Prices for both types of cookstove credits are strong, ranging from $15-25 per ton. This contrasts with non-compliance, legacy voluntary credits, which continue to trade in the sub-$5 territory.
KOKO chose not to take the “CCP" voluntary pathway and instead argued that the only way forward was to sell through the CORSIA scheme. To do this, they needed a Letter of Authorization (LOA) from the Government of Kenya to export those carbon credits. (An LoA is a sovereign approval required under international carbon market rules. Unfortunately, KOKO never received the LoA to export its credits.)
Kenya is expected to issue its first LoAs in the coming months, provided projects meet national requirements.
The LoA approval process is more advanced across Africa, with governments issuing over with 20 LoAs and over 7.4M issued and authorized credits so far. Just last week, clean cooking company Del Agua secured authorization and CORSIA tagging for 4.7M clean cookstove credits from three countries. BURN, a Kenya-based clean cooking company has received 4 LoAs and issued the first insured CORSIA tagged credits in 2025. This follows similar instances, including corresponding adjustments applied by Malawi, Zimbabwe, and a successful transfer of cooking credits from Ghana to Switzerland. Together, these show a growing compliance carbon market across the continent.
A final point on recurring fuel subsidies vs one-time stove subsidies
A carbon credit subsidy, like any investment, has some inherent risk. The majority of clean cooking carbon finance is a low-risk, one-time subsidy, usually as a price discount on the hardware. The investment for a $50 discount can be easily recouped over the 5-10 years of carbon sales.
A riskier model is to have an ongoing fuel subsidy, whether it be for LPG, pellets, or ethanol. It's not impossible, but it requires selling fuel at a loss. This model needs guaranteed carbon credit offtakes, usually at a >$20 price point.
An ongoing fuel subsidy model, the lack of an LOA, and the inability to pivot to high value "CCP" voluntary credits all led to the spectacular collapse of KOKO.
By simply avoiding any one of these pitfalls, clean cooking will deliver on its goal to transform the lives of more than a billion people.
