KOKO secures $180-million guarantee from MIGA to protect carbon credit revenues
Kenya’s KOKO Networks has secured a $179.6-million guarantee from the World Bank’s insurance arm Multilateral Investment Guarantee Agency (MIGA) to protect its carbon credit revenues from political risks, the company shared in a press release on Monday March 17. This move could strengthen investor confidence in compliance-grade carbon markets like CORSIA.
However, KOKO’s credits are not yet CORSIA Phase 1 eligible, as they still require a letter of authorisation (LoA) and corresponding adjustments from the Kenyan government. MIGA issued the guarantee to cover investments by KOKO Networks of Mauritius into its Kenyan subsidiary. The coverage shields the company from risks including expropriation, transfer restrictions and breach of contract for up to 15 years, ensuring it can continue generating and trading carbon credits under evolving regulatory frameworks.
A Singapore-based trader told Fastmarkets that while bids for the Gold Standard (GS)-certified KOKO’s cookstoves credits were heard around $12-$16 per tCO2e, offers were reported around $20 per tCO2e. The gap highlights the challenges facing Article 6-aligned projects, as buyers weigh regulatory uncertainty and the timeline for securing corresponding adjustments against the potential long-term value of compliance-grade credits.
A London-based trader added that while prices for CORSIA Phase 1 credits are currently reported around $21 per tCO2e levels, they will likely drop once supply increases in the market after host country governments grant corresponding adjustments.
However, there remains uncertainty over the supply outlook for this year. Both Gold Standard and Verra require insurance to protect against revocation risk by a host-country between an LoA being granted and a corresponding adjustment being made and reported. Currently Gold Standard only accepts MIGA insurance, but both Gold Standard and Verra are looking at setting guidelines and criteria to evaluate other insurance providers later in the year.
KOKO supplies bioethanol cookstoves and fuel to over 1.3 million low-income households in Kenya, replacing charcoal and firewood – major drivers of deforestation and indoor air pollution. The transition generates about 6 million tonnes of carbon credits annually, certified under GS, with revenues used to subsidize fuel costs. The company has issued over 10 million vintage 2021-2024 credits as of late-March.
Greg Murray, Koko’s chief executive officer, said the company operates in highly regulated energy and carbon markets where political risk is a key concern. “MIGA’s guarantee ensures that our carbon finance model remains viable, allowing us to continue expanding clean fuel access while generating compliance-grade carbon credits,” he said. The World Bank has increasingly turned to guarantees to de-risk climate investments, and MIGA’s backing of KOKO suggests a growing focus on carbon finance as a tool for energy transition.
As demand for high-integrity carbon credits rises, particularly in compliance markets, financial risk coverage could play a larger role in stabilizing long-term investments in carbon projects. However, the effectiveness of such guarantees will depend on the speed at which governments implement the necessary policy frameworks to align with international carbon market rules.
Arup agrees £1mln investment for 10,000 tCO2e of UK nature-based carbon removals
UK-based consultancy Arup agreed to a £1 million ($1.27 million) investment to support the restoration of UK nature-based project developer Nattergal’s 617 hectare Boothby Wildlands project in Lincolnshire. As part of the investment, Arup will receive 10,000 tCO2e of nature-based carbon removals from the project over the next 30 years.
The upfront investment, rather than through land ownership or payment on delivery, provides a “new model for private sector support in nature restoration” Arup said in a statement in early March. The company said that nature-based carbon removal projects are “not happening at the speed needed” so hopes the upfront investment will accelerate the development and delivery of the project.
The project involves the rewilding of arable farmland, with Arup’s investment supporting the restoration of 67.5 hectares of degraded land with carbon-depleted soils. This increases carbon sequestration and creates other environmental benefits including enhanced biodiversity, improved soil health and water quality, and flood attenuation. The carbon removal credits generated from the project are verified under Wilder Carbon’s Standard for Nature and Climate.
The deal marks the largest purchase of credits registered under the Wilder Carbon Registry. Previously just over 400 tCO2e credits had been purchased by three entities across two projects. A total of just four projects are currently registered under the standard. The registry lists the total cost of the Boothby Wildlands project at £5.2 million.
Carbon dioxide removal (CDR) demand ends the quarter strong, led by Microsoft
Demand for multi-year nature-based and durable CDR offtakes ended the quarter strong, with just under 2.5 million tCO2e agreed and tracked by Fastmarkets in March.
Microsoft continued to be the main demand driver in the market, signing a 1.5 million tCO2e Afforestation, Reforestation and Revegetation (ARR) offtake with Climate Impact Partners and Terra Natural Capital. The credits will be generated from the Panna ARR (VCS 4811) project in India and be delivered over 30 years, with the offtake representing around 50% of the project’s output.
Microsoft had previously signed multi-year ARR offtakes totalling more than 10 million tCO2e in January.
Carbon demand aggregator Frontier also signed a $33 million agreement for over 78,000 tCO2e of enhanced rock weathering (ERW) credits with US developer Eion in March to be delivered between 2027 and 2030. There have been signs of increased interest from buyers for ERW credits this year with some viewing it as a scalable pathway to durable carbon removals.
Other notable deals agreed this month included Japanese shipping company Mitsui OSK Lines purchasing 30,000 tCO2e of direct ocean capture credits from Captura for delivery by 2030. While Meta bought 676,000 tCO2e of Improved Forest Management (IFM) removal credits for delivery through 2035 from investment firm EFM. The structure of the deal was novel, in that the negotiations to purchase the land took place in parallel to the offtake agreement. Traditionally property owners have sold credits only after securing ownership.
Airbus to test Sustainable aviation fuel (SAF) ‘book and claim’ demand through 2025
Airbus will test customer demand for sustainable aviation fuel (SAF) through 2025 with a pilot program for “book and claim,” the company announced late March. Book and claim allows customers to request and pay for SAF usage to offset the carbon emissions from their own activities, and claim the emissions credits.
The actual SAF is used wherever it is available and most convenient within the overall aviation system, not necessarily on the routes used by the booking customer. Airbus will purchase SAF certificates through the Roundtable on Sustainable Biomaterials (RSB) registry. The pilot program will focus on customers who need “limited volumes” and are far from SAF supply points, the press release said.
To that end, Airbus has signed a memorandum of understanding (MOU) to collaborate on the book and claim pilot program with a number of private jet charter companies, maintenance providers and other small companies. Airbus has collaborated with and invested globally in a number of airlines, producers and financing initiatives toward the development of the SAF industry.
Earlier this month, Airbus announced that SAF deliveries had begun at its Mirabel, Canada commercial aircraft assembly site, marking SAF availability at all of the company’s test and assembly sites worldwide. At the same time, Airbus announced that 18% of its global fuel mix in 2024 was made up of SAF, and that it would continue to increase its usage toward a goal of 30% by 2030.
Frontier agrees $33 mln enhanced rock weathering carbon removal offtake with Eion Frontier, a carbon demand aggregator, has agreed a $33 million multi-year offtake agreement with US carbon removals project developer Eion for 78,707 tCO2e of enhanced rock weathering carbon credits between 2027 and 2030, according to a press release in late March.
The credits will be sourced from Eion projects in the Southern and Midwestern US, and equates to a cost of around $419.27 per tCO2e. Eion sources olivine, a rock type that reacts quickly with carbon dioxide, and spreads it on agricultural fields. The olivine then reacts with rainwater, converting atmospheric carbon dioxide into bicarbonate, which is then stored permanently in the ocean.
The fast weathering of olivine allows it to remove more carbon dioxide than other enhanced weathering methods. Meanwhile, the ability to subsidize costs with carbon credits allows farmers to use a cheaper alternative to ag lime for managing soil pH. The deal will allow Eion to expand its monitoring and validation efforts, and help drive down the cost of durable carbon removal through enhanced rock weathering, Anastasia Pavlovic, Eion’s chief executive officer, said.
Other market participants have told Fastmarkets that, despite comprising small volumes currently, interest in enhanced rock weathering has increased in recent months, with some viewing it as a scalable pathway to durable carbon removals.
Frontier buyers, including Stripe, Google, Shopify, Autodesk, H&M Group, JPMorgan Chase, Workday and Salesforce, formed part of the agreement. Other companies will also receive credits via Frontier’s partnership with US-based sustainability platform Watershed.
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The stories included in this article are taken from the Fastmarkets carbon markets news subscription service, from March 2025.
