Zimbabwe carbon projects band together after shock revenue split demand

The owners of Zimbabwean carbon credit projects have formed an association to lobby the government over its plan to enact rules that could see them cede half of their revenue to the state.

The Zimbabwe Carbon Association brings together about 13 project developers with more than $100 million of investment planned, the organisation said. The project activities range from reafforestation to the provision of clean energy.

Zimbabwe in May roiled the $2 billion global carbon offsets energy by announcing that existing projects would be “null and void” and in addition to the share of revenue going to the state, local investors would get at least 20%. The sudden announcement highlighted the risk of investing in countries that have yet to regulate the industry.

Among the developers concerns are the planned revenue split, the enforced use of a national registry and trading of all credits on a local exchange, Nick de Swardt, the association’s chairman, said in an interview on Thursday.

“Project developers are concerned with rushing into use of a national registry that doesn’t have international recognition,” he said. “If we want buyers to buy our credits we need international recognition.”

A single carbon credit represents a ton of climate warming carbon dioxide or its equivalent removed from the atmosphere or prevented from entering it in the first place. They are bought by emitters of greenhouse gases to offset their activities.

The association’s members include Cicada Carbon, which is planning to distribute fuel-efficient wood stoves and to preserve and replant forests, and Namene, which aims to curb fossil fuel emissions through the rollout of solar power.

A meeting with the government is planned next month. The government has complained that earlier agreements, made mainly with municipalities or traditional leaders, saw little money flowing back to Zimbabweans.

While the law was announced in May it’s yet to be enacted, deepening uncertainty. A conference convened in the country this month by a group planning to start a carbon exchange added to the controversy surrounding the industry with a plan to list dated and discredited Russian offsets on the bourse. That plan was later scrapped.

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