In the heart of Nairobi, Mary Kavutha’s morning routine has transformed. Two years ago, she cooked with a charcoal stove, battling smoke and high fuel costs. Today, she uses an induction cooker powered by electricity tokens that cost her less than before. Her story is becoming increasingly common across Africa, thanks to the rise of carbon credit financing.
Nearly 1 billion Africans still rely on charcoal or firewood for cooking, contributing to 850,000 deaths annually from household air pollution, according to the International Energy Agency (IEA). However, a financial innovation is changing this landscape. Carbon credit financing allows clean cooking companies to raise capital against future revenues from emission reductions, making eco-friendly stoves affordable for low-income households.
Carbon Finance: The Catalyst for Clean Cooking
In June 2026, the IEA announced that Africa had secured $900 million in new financial commitments towards clean cooking technologies. More than 30 governments, representing about 80% of Africans lacking access to clean cooking, have introduced 121 new policies since the 2015 Paris climate summit. Tanzanian President Samia Suluhu emphasized the necessity of clean cooking, stating it is not a luxury but an everyday necessity.
Peter Scott founder and CEO of BURN a company specializing in eco-friendly cookstoves, highlights the pivotal role of carbon finance. “The only way clean cooking is going to scale on the continent is through carbon project finance,” Scott said. BURN has distributed over 7.3 million cookstoves in 11 African countries, thanks to this innovative financing model.
The Mechanics of Carbon Credit Financing
Carbon credit financing works by subsidizing the retail price of clean cookstoves. An efficient biomass stove that normally retails for about $40 can cost customers as little as $5 after carbon subsidies. More expensive induction cookers are financed through carbon credits and short-term pay-as-you-go plans. Investors provide upfront capital, which subsidizes the retail price of the stoves. In return, they receive revenue from carbon credits generated as households reduce their use of charcoal, wood, and other polluting fuels.
The industry has adopted strict standards and more sophisticated measuring of emissions, including Bluetooth monitoring digital verification, and real-time usage data to address criticism of carbon credits. These advancements ensure the credibility and effectiveness of the projects.
Challenges and Adaptations
Despite its success, carbon credit financing faces criticism. Critics argue that relying too heavily on carbon credits is risky. In February 2026, the Kenyan clean cooking firm Koko Networks once hailed as a poster child of Africa’s green transition, closed after failing to win a government letter of authorization to sell carbon credits.
George Mwaniki WRI Kenya representative and head of Air Quality for WRI Africa, cautions that carbon finance generally comes after the investment required to put cleaner cooking equipment into households. “Carbon financing is more of a second financing source,” Mwaniki said. “If we depend wholly on carbon credits to support the transition, it will be extremely slow and will not happen at the pace that we need it to.”
Companies are adapting their approaches to suit local conditions. BURN, for example, finds electric cooking more viable in Kenya and Tanzania, while biomass stoves are preferred in the Democratic Republic of Congo and Madagascar. Other companies, like Eco Safi and BioMassters are offering innovative solutions such as forced-draft pellet stoves and smokeless, solar-powered pellet stoves.
For households like Kavutha’s, the benefits are clear. “My kitchen is cleaner, my children are safer, and I spend less,” she said. “That is all that matters.”
