Environment UAE companies pledge $450m to buy African carbon credits By Sarah Townsend September 5, 2023 Wam UAE Carbon Alliance chair Sheikha Shamma bint Sultan bin Khalifa Al Nahyan said demand for carbon credits exceeded the UAE's supply alone UAE Carbon Alliance agrees deal with ACMI Aims to develop carbon financing standards The UAE Carbon Alliance, a coalition of UAE companies aiming to develop a carbon market in the emirates, has pledged to buy $450 million of African carbon credits by 2030. The alliance signed a non-binding agreement with the Africa Carbon Markets Initiative (ACMI), which was launched last year at Cop27 in Egypt to harness potential in Africa. A carbon market is a trading system in which companies or individuals wanting to compensate for or offset greenhouse gas emissions buy and sell carbon. The credits are related to projects or organisations that work to reduce or remove emissions. Carbon credits trading predicted to hit $4bn Six UAE banks allocate $52bn for renewable projects Cop28 and UN to draft climate finance framework The UAE Independent Climate Change Accelerators (UICCA), a think tank and lobby group, set up the UAE Carbon Alliance in June. It is chaired by UICCA president and chief executive Sheikha Shamma bint Sultan bin Khalifa Al Nahyan. The UAE Carbon Alliance wants to develop standards and frameworks for carbon financing, increase public and professional knowledge of markets and help organisations reduce their emissions. As well as UICCA, the alliance’s founding members are First Abu Dhabi Bank, Mubadala Investment Company, Abu Dhabi National Energy Company, Abu Dhabi Future Energy Company and the Air Carbon Exchange (ACX). UICCAUICCA senior manager Hassaan Ghazali announcing the UAE Carbon Alliance pledge at ACS23 The agreement this week represents a $450 million signal of intent by the UAE Carbon Alliance to ACMI’s Advance Market Signal – similar to a fundraising campaign. The other signatories to date include Standard Chartered bank, Vertree, ETG and Nando’s, which together account for $200 million to purchase African carbon credits by 2030. Sheikha Shamma said that alliance “aspires to aggregate demand for high-quality carbon credits from the UAE, demand that already exceeds the supply available from the UAE alone”. Carbon credits could become a $4 billion global asset class within the next half-decade, ACX co-founder Thomas McMahon told AGBI last month.