By Abbas Nazil
The signing of Nigeria’s National Carbon Market Framework (NCMF) 2024 marks a significant step in operationalising the 2021 Climate Change Act and positioning the country within Article 6 of the Paris Agreement and the Voluntary Carbon Market (VCM).
The framework outlines institutional structures, fiscal incentives, ownership rules, and benefit-sharing mechanisms aimed at monetising emissions reductions while advancing sustainable development goals.
Nigeria aims to generate up to 124.7 MtCO2e of reductions and attract $2.5 billion in market value by 2030, signalling a shift from donor-dependent climate finance toward self-sustaining green capital markets.
However, the NCMF remains a non-binding policy instrument rather than a statutory regime, relying heavily on ministerial discretion, voluntary cooperation, and administrative goodwill, which risks inconsistent application, weak compliance, and limited investor confidence.
The proposed Decarbonisation Bill seeks to address this gap by creating a legally empowered National Decarbonisation Authority (NDA) to regulate market participants, enforce compliance, manage Monitoring, Reporting, and Verification (MRV) systems, and administer the National Green Transition Fund (NGTF).
It also ensures statutory oversight over carbon registry functions, third-party verification, and satellite monitoring to maintain carbon credit integrity and prevent double-counting, elevating Nigeria’s credibility in international markets.
While the NCMF introduces fiscal incentives, these remain indicative and vulnerable to political shifts, whereas the Bill institutionalises predictable financing, de-risking private capital, and establishing transparent benefit-sharing with communities.
The Decarbonisation Bill embeds a just transition framework, ensuring local reinvestment, reskilling, and equitable distribution of climate finance, while also including objectives for methane emission capture and management, which are largely absent in the NCMF.
By consolidating oversight, codifying enforcement, and providing legal authority, the Bill transforms Nigeria’s carbon policy from aspirational to actionable, creating a credible, measurable, and bankable carbon market, positioning the country as a leading hub for green investment and sustainable development in Africa.