Qatar's carbon offset platform plans to list credits on Mena exchanges

Doha-based Global Carbon Council is in talks with Mena exchanges to list its carbon credits, a senior executive has said.

The council, an international carbon credit programme, plans to list the credits issued by it to clean energy projects from nearly 45 countries on carbon exchanges based in Egypt, Saudi Arabia and the UAE, chief operating officer Kishor Rajhansa told The National.

Carbon credits, also known as carbon offsets, are permits that allow companies to emit a certain amount of carbon dioxide or other greenhouse gases. The funds from the sale of the credits are used to finance climate action projects that would not otherwise get off the ground.

The market for the financial instrument could be worth more than $50 billion by 2030, according to global consultancy McKinsey.

The Global Carbon Council has already signed an agreement with the Egyptian Stock Exchange, which launched Africa’s first regulated voluntary carbon market in January.

Mr Rajhansa said the council was also in talks with Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, which together with Saudi Tadawul Group established the Regional Voluntary Carbon Market Company (RVCMC) last year.

The carbon credits comply with Corsia, a programme run by the International Civil Aviation Organisation.

“Our credits will be available on the exchanges for selling and having spot transactions,” Mr Rajhansa said.

“When you do spot transactions, you get better prices as well because the risk of project registration and issuance have been already taken out.”

The Global Carbon Council, which has no plans for its own exchange, acts as a regulator and is responsible for bringing the “highest quality” assets in the market, Mr Rajhansa said.

In June, Saudi Arabia's RVCMC oversaw the sale of more than 2.2 million carbon offsets in what it described as the largest auction of voluntary carbon credits yet.

The company plans to launch a carbon credit trading exchange in early 2024 and establish a fund to invest in climate projects, its chief executive Riham ElGizy told The National.

Last year, the Abu Dhabi Global Market teamed up with AirCarbon Exchange to create the “world’s first fully regulated” carbon-trading exchange and clearing house in the emirate.

The Global Carbon Council has set up a new division to help governments set up their carbon pricing policies as Article 6 of the Paris Agreement seeks to establish a new global carbon offsetting programme.

Countries did not agree on technical details for running trading in carbon credits at the Cop27 climate conference in Egypt last year.

“Article 6 is coming up and there are a lot of complexities and nuances around [it],” Mr Rajahansa said.

The council may start a carbon finance facility in 2024, which will be run independently by buyers of carbon credits, he said.

“The idea is to give the predictability of carbon finance to the market and to give a good market price for the project owner and not let intermediary entities take away all the profits,” Mr Rajahansa said.

“One year back, we had asked for an expression of interest from market players to apply for [an] independent running carbon facility [and] many market participants had responded to it.”