Africa’s clean cooking problem has a solution, and it is not a subsidy programme governments cannot afford. Carbon finance can reduce the cost of a cookstove from $50 to as little as $3 for households that could never buy one at full price, while generating revenue for governments and investors alike. The collapse of Kenya’s KOKO Networks has prompted fresh doubt about the model but analysts argue the lesson is about execution failures, not a fundamental flaw in carbon-financed clean cooking.
- An estimated 1.2 billion people across Sub-Saharan Africa lack access to clean cooking solutions; the barrier is not technology or willingness to adopt but the upfront cost of appliances, which carbon credits can discount by 50% to 90%, bringing a $50 cookstove within reach at $3 to $5
- Delivering clean cooking to every household on the continent through government subsidy programmes alone would cost approximately $10 billion in public expenditure; carbon finance reduces that public capital requirement to around $3 billion while generating up to 10 times that figure in revenue from credit sales over the life of a project
- Carbon credit prices for high-integrity cookstove credits currently range from $15 to $25 per tonne under both the CORSIA compliance scheme and the Core Carbon Principles (CCP) voluntary market, compared with legacy voluntary credits trading below $5 per tonne the price gap rewards projects that pursue certification rigorously
- The Trade Development Bank, with support from the World Bank’s Ascent facility, recently closed a deal structuring carbon credits as the repayment mechanism for clean cooking debt financing credit sale revenues repay the loan, which is then recycled to subsidise more stoves, keeping more capital on the continent
- BURN, a Kenya-based cookstove manufacturer, has received four Letters of Authorization and issued the first insured CORSIA-tagged credits in 2025; Del Agua secured authorisation and CORSIA tagging for 4.7 million clean cookstove credits across three countries in a single transaction last month
- More than 20 Letters of Authorization have now been issued across Africa, with over 7.4 million credits authorised and corresponding adjustments applied in Malawi, Zimbabwe, and Ghana the sovereign approval pipeline that stalled projects like KOKO is moving faster elsewhere on the continent
- KOKO Networks collapsed for three specific, avoidable reasons: it chose an ongoing fuel subsidy model rather than a one-time hardware subsidy, it failed to obtain a Letter of Authorization from the Kenyan government to export credits under CORSIA, and it did not pursue the CCP voluntary pathway that now commands premium prices any one of these pivots might have kept the business viable
The debate over carbon finance and clean cooking in Africa tends to collapse into a binary that the facts do not support. Critics point to KOKO’s closure as evidence that carbon credits cannot reliably fund clean cooking at scale. Proponents point to BURN and Del Agua as evidence that they can. Both are right about individual companies and wrong about the model. Carbon-financed clean cooking works when the subsidy is a one-time hardware discount rather than an ongoing fuel commitment, when the project developer secures the sovereign authorisations required to sell credits into compliance markets, and when the credits are certified to the highest current integrity standards. KOKO failed all three tests simultaneously. The structural case for carbon finance remains intact: no government on the continent has the fiscal space to spend $10 billion subsidising cookstoves from tax revenues, and no commercial lender will finance appliance sales to households earning under $5 per day without a credit-backed revenue stream to underwrite the risk. Carbon finance is not a perfect mechanism but it is, as the analysis argues, currently the only mechanism that solves the affordability equation at the scale the problem demands.
The Bigger Picture: Clean cooking is one of the most undercovered public health and climate crises on the continent. Household air pollution from solid-fuel cooking kills more Africans each year than malaria, and the carbon emissions from 1.2 billion people burning charcoal and wood are a meaningful contributor to the continent’s overall emissions footprint. Carbon finance addresses both dimensions at once: it monetises the emissions reduction that a clean cookstove delivers and uses that revenue to make the stove affordable. The maturation of compliance carbon markets in 2025, with CORSIA becoming operational and CCP credits commanding $15 to $25 per tonne, has materially improved the economics of the model relative to two years ago when voluntary credit prices had collapsed to near zero. The critical variable now is the pace of Letters of Authorization from African governments. Kenya’s delay cost KOKO its business. Countries that move faster on sovereign authorisation, as Malawi, Zimbabwe and Ghana have already demonstrated, create the conditions for a functioning market. The clean cooking sector does not need a new financial model. It needs governments to process authorisations and developers to structure projects that can withstand integrity scrutiny. The technology is ready. The finance is available. The regulatory pipeline is the bottleneck.
Source: Kenyan Wall Street
