Welcome to part II of our series on environmental legislation in Zambia. In this article, we will explore the Green Economy and Climate Change Act of 2024.

The Green Economy and Climate Change Act of 2024: Paving the Way for Carbon Market Regulation

Zambia has taken a major step toward climate action and sustainable development with the introduction of the Green Economy and Climate Change Act No. 18 of 2024 (the “GEACC Act or the Act”). Enacted in December 2024, this legislation establishes a framework for regulating carbon markets in the country. Its key objectives include reducing greenhouse gas emissions, promoting economic growth, and enhancing environmental protection. The Act also addresses challenges such as transparency issues, weak regulation, the risk of exploitation of participants and revenue loss in carbon markets.

A New Era for Climate Governance in Zambia

The GEACC Act provides a framework to address climate change and foster a green economy in Zambia. It aims to integrate climate resilience into key sectors like agriculture, energy, transport, and forestry. A key feature of the Act is its regulation of carbon credit trading, a vital tool in the global effort to combat climate change.

Carbon Credits and Their Role in Climate Mitigation

Carbon credits are a market-based mechanism that incentivize emission reductions. They are issued when projects—such as renewable energy installations, reforestation, or energy efficiency programs—result in measurable reductions in emissions. The GEACC Act allows Zambian companies and organizations to generate and trade carbon credits through certified emission-reducing activities. The Act sets out rules for the issuance, verification, and trading of these credits to ensure transparency, credibility, and alignment with global climate goals.

Key Provisions of the Act

The Green Economy and Climate Change Act lays out important provisions to regulate Zambia's carbon market:

1. Authorisation to trade in Carbon Credits: The Act establishes a transparent system for obtaining authorization for trading in carbon credits. Third-party verification bodies will ensure projects meet the required standards for emission reductions, and a national registry will track and manage carbon credits to maintain market integrity.

2. Emission Reduction Projects: The Act empowers the Department of Green Economy to issue guidelines for businesses, governments, and non-governmental organizations on implementing emission reduction projects, such as renewable energy, reforestation, agroforestry, and sustainable agriculture. The focus on nature-based solutions, like forest conservation, highlights Zambia’s valuable natural resources.

3. Incentives for Carbon Credit Projects: To encourage private sector investment in green initiatives, the Act provides for the Minister of Finance to offer incentives for organizations generating carbon credits. These incentives will help stimulate local economies and contribute to global climate mitigation.

Carbon Stock Management under the Act

The Act also addresses carbon stock management, referring to the carbon stored in forests, soil, and ecosystems. This is crucial for accurately accounting for emission-reduction projects, particularly in forestry and agriculture, and ensuring the protection and enhancement of Zambia’s carbon sinks.

The carbon stock management provisions of the Act should be read together with the Forest Act (Carbon Stock Management) Regulations, 2021, which provide specific guidelines for managing carbon stocks in Zambia’s forests. These two pieces of legislation work together to ensure that Zambia’s carbon assets are properly monitored, strengthening the integrity of the carbon credit market and supporting climate change mitigation efforts.

Submission of Concept Note and obtaining authorization for Carbon Credit Projects

Project developers wishing to generate carbon credits must follow the process outlined in the Act. This begins with submitting a concept note to the Director of Green Economy and Climate Change (the “Director”). The concept note outlines the project's goals, methodology, expected outcomes, and potential environmental and social impacts. The Director refers the concept note to a Technical Committee, which evaluates whether the project aligns with the Act’s objectives and does not harm Zambia’s climate or ecosystems.

Once the concept note is approved, project developers can submit a detailed project plan for further approval. After meeting all environmental, social, and regulatory requirements, project developers must apply for a Certificate of Authorization. This certificate grants legal permission to generate and trade carbon credits and must be periodically renewed to ensure continued compliance.

Economic Opportunities and Challenges

Regulating carbon credits presents significant economic opportunities for Zambia, particularly in renewable energy, agriculture, and forestry. As the global economy shifts toward low-carbon practices, Zambia stands to gain new revenue streams through carbon credit sales. These projects can create jobs, improve livelihoods, and drive investments in green technologies.

However, successful implementation of the Green Economy and Climate Change Act will require overcoming certain challenges. These include ensuring effective monitoring, verification, and enforcement of carbon credit projects, as well as addressing concerns about fraud and mismanagement. Zambia also needs to build the technical expertise, infrastructure, and regulatory capacity needed to participate in global carbon markets and attract international investment.

Conclusion

Zambia’s Green Economy and Climate Change Act demonstrates the country’s commitment to addressing climate change while fostering economic growth. By regulating carbon credits and creating a favorable environment for climate action, the Act opens the door to a sustainable future.