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UAE Carbon Alliance plans $450m purchase of African carbon credits by 2030

UAE Carbon Alliance plans $450m purchase of African carbon credits by 2030
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UAE – Mubasher: The UAE Carbon Alliance intends to pledge an indicative intended purchase amounting to $450 million in African carbon credits by 2030.

The targeted purchase is a result of a recent non-binding Letter of Intent between the UAE alliance and the Africa Carbon Markets Initiative’s (ACMI) Advance Market Signal, which was launched during COP27 that took place in 2022, according to a press release.

Buying African carbon credits aims to link their high-integrity supply with high demand from the Middle East.

Head of UAE Carbon Alliance, Sheikha Shamma bint Sultan bin Khalifa Al Nahyan, who is President and CEO of the UAE Independent Climate Change Accelerators (UICCA), said: “As we navigate the climate crisis, carbon markets stand as a pivotal tool in our decarbonisation journey.”

Al Nahyan noted: “Our collaboration with the Africa Carbon Markets Initiative provides carbon market buyers in the UAE and wider region with access to high-quality carbon credits in Africa. This does not only help to unlock Africa’s carbon credit generation potential, but also supports sustainable investment opportunities and long-term climate impact.”

She concluded that the pledge would hope to foster more integrated and efficient carbon market mechanisms across the regions.

It is worth mentioning that ACMI was launched from the collaboration between Sustainable Energy for All (SEforALL), the Global Energy Alliance for People and Planet (GEAPP), and The Rockefeller Foundation. It was also out in partnership with the United Nations Economic Commission for Africa (UNECA) and the UN Climate Change High-Level Champions.

The initiative has an objective of establishing, amplifying, and sustaining the next generation of high-integrity carbon credits in Africa in order to eliminate emissions while bringing transparency and integrity to voluntary carbon markets in the region.

CEO of ACMI, Paul Muthaura, said: “We seek to promote a conducive environment across continental jurisdictions that bridges the demand from the Middle East among others, with Africa's potential for high integrity supply.”

Standard Chartered, Vertree, ETG, and Nando’s are among ACMI’s Advance Market Signal, with an estimated $200 million –to date- collected for the purchase of African carbon credits by 2030.

Meanwhile, the founding members of the UAE Carbon Alliance include AirCarbon Exchange (ACX), the listed First Abu Dhabi Bank (FAB) and Abu Dhabi National Energy Company (TAQA), Mubadala Investment Company, and Abu Dhabi Future Energy Company (Masdar), besides UICCA as its secretariat.