Climate change presents the continent of Africa with multiple challenges. African countries are particularly exposed to the physical risks arising from the global rise in temperatures. They also face the question of how to manage and finance the economic transformation that will be required to curb greenhouse gas emissions and halt the destruction of nature.
Damilola Ogunbiyi and Joseph Nganga in Harnessing carbon markets for Africa state that; “Global demand in Voluntary Carbon Markets (VCMs) has grown strongly in the last five years, driven principally by companies buying credits to help meet their climate pledges. Supply and demand of African carbon credits is also increasing, but from a low base, with the result that the continent currently generates only a small proportion of its potential. Boosting supply of credits would enable much-needed sustainable investment in sectors ranging from renewable energy and clean cookstoves, to agriculture and forestry.”
Tamuwa currently has manufacturing facilities producing renewable biomass fuels in Kenya and is expanding production to support wider sustainable development across East Africa. Tamuwa has partnered with KrypC’s CarbonCore to tokenize its carbon assets and is now transacting on the CYNK platform. The main goal of the CYNK peer-to-peer marketplace is to connect climate action projects in the Global South directly with ethical buyers offsetting their carbon footprint in the Global North. Lower-income countries have until recently been largely excluded from the carbon markets due to significant barriers to entry including the cost of starting up new projects and obtaining certification showing the need for this new innovative solution for projects to access early-stage carbon financing and greater value from their carbon asset. This will ultimately help increase impact exponentially.
Furthermore, the lack of transparency and trust in the voluntary carbon markets has not only limited the participation of smaller project developers but has also blocked vital start-up funding for climate action. There’s a growing consensus within the sustainability space that credibility, transparency, and discoverability of data leading to greater efficiency is the key to scalability. Tamuwa has embraced these developments and as a result, is giving greater confidence to buyers. The cost of IoT, implementing digital MRVs and remote sensing, are investments to provide verification alongside certification. Through the use of carbon credit asset forwards and futures projects can gain access to early-stage funding which will:
– Empower projects in lower-income countries, removing barriers to entry
– Fund the required build of digital infrastructure on DLT and any required certification process to help realize greater carbon revenues
– Provide logistical and operational support for these projects
Tamuwa along with CarbonCore (powered by the open-source Guardian on Hedera) is tokenizing assets, futures and forwards to grow the Global South carbon credits market.
The rapid evolution of the sustainability space is acting as a catalyst for change, and Tamuwa, through the CYNK platform, feels their purpose is to level the playing field and help close the climate funding gap. As part of this mission, CYNK is also supporting other renewable biomass companies and climate action projects in the region, by providing expertise and methodologies to create ESG assets on its platform. CYNK are currently working on new projects in the nature-based solutions, blue carbon and regenerative agriculture sectors. The growing Hedera community and its open-source Guardian, allow projects such as Tamuwa to tokenize its carbon assets on the CYNK platform and gain access to early-stage funding and fairer value through higher prices in the climate markets.