PMI Regional Programs
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Program Overview
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Despite significant climate finance needs, Sub-Saharan African countries have been underrepresented in efforts to advance carbon pricing and carbon market mechanisms. On the market side, the region accounted for only about 3% of CDM projects under the Kyoto Protocol, despite strong potential to generate emissions reductions with high development impact. Carbon pricing instruments have likewise played a limited role in mobilizing domestic revenue, with South Africa’s carbon tax remaining the main explicit example to date.
Objectives & Activities
The Regional Program aims to address critical knowledge and capacity gaps in Sub-Saharan African countries through regional dialogue, peer exchange, and practical analytical and policy work focused on carbon markets and carbon pricing. Two targeted efforts are currently underway under the program:
- Regional ASCENT Carbon Program for Eastern and Southern African Countries (PMI grant: $350,000)
The ASCENT Program aims to expand electricity access to 100 million people across 20 countries in Eastern and Southern Africa and mobilize additional financing, including through carbon markets, by monetizing emissions reductions from energy access and clean cooking investments. PMI support focuses on strengthening the enabling environment for carbon markets across several ASCENT countries, including institutional arrangements, regulatory readiness, and coordination across energy and climate institutions. Activities include targeted readiness assessments, development of a standardized carbon market strategy template, and capacity building and peer learning to support coordinated regional approaches.
- Regional Program on Carbon Pricing Options in Africa (PMI grant: $450,000)
In a context of constrained fiscal space, this program supports African governments in exploring carbon pricing pathways that strengthen environmental and economic incentives while remaining politically and economically feasible, including by laying analytical and institutional foundations for potential direct carbon pricing. Activities focus on reforms to existing tax instruments (fuels, excises, vehicles, commodities), application of practical analytical tools to inform policy design, targeted technical assistance to support reform processes, and regional dialogue and peer learning to enhance coordination and manage competitiveness and leakage risks.