President Bola Ahmed Tinubu has approved the implementation and operationalisation of Nigeria’s carbon market framework, a landmark policy projected to generate at least $3 billion annually by 2030.

The approval positions Nigeria at the forefront of carbon trading in Africa, opening opportunities for large-scale emission allowance transactions across key sectors of the economy.

Under the new framework, the Federal Government will establish a national carbon registry and introduce mandatory emissions reporting for companies. It also provides for phased compliance mechanisms aligned with Nigeria’s climate commitments, including emissions reduction targets by 2035 and achieving net-zero emissions by 2060.

To attract investment and stimulate participation in the carbon market, the framework offers several fiscal incentives. These include tax exemptions on carbon credit revenue for up to 10 years, accelerated capital allowances for low-carbon assets, and research and development deductions linked to emissions-reduction projects.

According to the government, the policy is designed to eliminate structural risks that have previously limited investor confidence and constrained the growth of carbon markets in the country.

The framework is expected to drive sustainable development, boost foreign and domestic investment, support Nigeria’s climate goals, and create new economic opportunities while strengthening the country’s leadership in climate action and green finance.