The Green Ledger: Tracking Nigeria’s Carbon Billions and Community Minions (1)

SOStainabilityWeekly

Edited by Oke Epia, E-mail: sostainability01@gmail.com  | WhatsApp: +234 8034000706

Trends and Threads

There is a quiet revolution happening in Nigeria’s policy corridors. It does not announce itself with fanfare on the evening news; it does not trend on social media the way petrol prices do, and it is not discussed at the local markets; yet, if the government’s projections are to be believed, it could be worth more to this country than the annual budget of several states combined. We are talking about Nigeria’s carbon market, a system designed to monetise the country’s vast forests, clean energy projects, and land use practices by converting greenhouse gas emissions reductions into tradeable credits sold to polluters at home and abroad.

President Bola Tinubu unveiled the Nigeria Carbon Market Activation Policy (NCMAP) in March 2025. The government’s own estimates put the potential at between $2.5 billion and $3 billion annually by 2030, alongside the creation of 600,000 to 2.3 million green jobs. Those are extraordinary numbers. They are also, at this moment, largely aspirational because the architecture needed to deliver them, while increasingly taking shape on paper, is still largely missing in practice. Worse, the people who stand to benefit most- Nigeria’s rural communities, smallholder farmers, and forest-dependent populations who have almost no idea this market exists or that it could transform their livelihoods.

This article is the beginning of a series into Nigeria’s carbon market ecosystem, beginning with the National Carbon Market Framework: what it says, who is supposed to do what, where meaningful progress appears to have been made, and where there are gaping gaps that, if not urgently addressed, could turn a generational opportunity into yet another forlorn hope.

The responsible entities and why they matter

The National Council on Climate Change (NCCC): The NCCC is chaired by the President of the Federal Republic, with the Vice President serving as Deputy Chair. It includes the Ministers of Environment, Petroleum Resources, Finance, Agriculture and Rural Development, Power, Industry, Trade and Investment, and others. Its Secretariat, headed by a Director-General, is the operational arm responsible for day-to-day implementation of the mandate of the council, which includes: overseeing Nigeria’s Nationally Determined Contributions (NDCs), coordinating the carbon budget, carbon credit approvals, and operationalization. It is also obligated under the Climate Change Act to partner with civil society organizations, promote climate education, and report annually to the National Assembly on the state of Nigeria’s climate change activities. In terms of delivery, the NCCC has taken some notable steps since its establishment in 2022. The finalization of the NCMAP in 2025 and unveiling of the National Carbon Market Framework (NCMF) are key examples. But the NCCC has also been hobbled by several factors, including being off the national budget until October 2025, when a presidential directive resolved the problem. What it now does with its budget is another question. There are also questions about inclusion and engagement of relevant stakeholders, including government ministries and agencies germane to the green economy. Details governing how project developers obtain approvals are not readily available to the public. Without clear, published procedures, the carbon market faces uncertainty that deters investors and opens the door to opaque arrangements. The NCCC must address these barriers without delays: It must, for instance, publish the complete No-Objection procedures for project approvals and release a publicly accessible, machine-readable national carbon registry. It must also produce and widely circulate annual reports to the National Assembly as required by law. A billion-dollar market cannot be governed in the dark.

The Federal Ministry of Industry, Trade and Investment (FMITI): This ministry plays a pivotal role in Nigeria’s carbon economy that often goes under the radar. At the sidelines of the 79th United Nations General Assembly in September 2024, it was the ministry’s Permanent Secretary, Ambassador Nura Rimi, who stood before the world and announced the NCMAP, pledging that the ministry would ensure the policy includes specific incentives to drive industrial growth and trade, creating a business-friendly environment for private sector engagement. There seems to be a structural irony here that deserves scrutiny. The FMITI supervises the Financial Reporting Council of Nigeria (FRC), which is the body responsible for mandating and standardizing sustainability disclosures by Nigerian companies, including the oil and gas companies whose emissions are directly relevant to the carbon market. The Africa Policy Research Institute (APRI), in a July 2025 report, noted that despite Nigeria’s climate commitments and policies, the FMITI has only minimally incorporated climate objectives into trade and industry policies, highlighting an urgent need for alignment and coherence. In plain terms: it would appear that the ministry that is meant to make Nigeria an attractive destination for carbon investment has not fully integrated climate logic into its own operations. It is imperative for the ministry to now publish a clear industry-facing guide on how businesses can participate in Nigeria’s carbon market. It must also strengthen the link between its industrial promotion mandate and the green economy while ensuring that the FRC’s sustainability reporting roadmap is adequately resourced and enforced.

The Financial Reporting Council of Nigeria (FRC): The Financial Reporting Council (FRC) of Nigeria, established under the FRC Act of 2011, is Nigeria’s primary body for developing and publishing accounting and financial reporting standards for public and private entities. In recent years, the FRC has taken important steps toward sustainability reporting — steps that have a direct bearing on the integrity of the carbon market. In 2023, the FRC published a Roadmap for the Adoption of ISSB (International Sustainability Standards Board) Standards in Nigeria. The amended 2026 roadmap further institutionalizes this by introducing Sustainability Reporting Guidance (SRG 1) and a National Digital Platform for sustainability disclosures. In April 2026, the FRC spotlighted early adopters of ISSB sustainability disclosure standards across banking, oil and gas, telecommunications, insurance, and consumer goods, as a positive signal. But there is a critical structural gap that the FRC must confront directly. Research published as recently as 2025 has found that FRC sustainability disclosures are not linked to the National GHG Registry, and the Nigerian Exchange Group’s ESG reporting systems are not connected to carbon credit Monitoring, Reporting, and Verification (MRV) systems. Most climate disclosures are still published in PDFs rather than machine-readable formats. This is not a minor technical problem; it is a fundamental integrity risk. If you cannot verify the emissions reductions underlying a carbon credit because the data systems do not talk to each other, the entire market’s credibility is called into question. The FRC must mandate machine-readable sustainability disclosures and integrate its sustainability reporting systems with the National GHG Registry. It must also make ESG disclosures for oil and gas companies compulsory, not voluntary. 

The Nigerian Upstream Petroleum Regulatory Commission (NUPRC): The Nigerian Upstream Petroleum Regulatory Commission (NUPRC), established under the Petroleum Industry Act 2021, regulates upstream oil and gas operations in Nigeria. Given that the oil and gas sector is a major source of greenhouse gas emissions in the country, the NUPRC sits at a critical intersection between Nigeria’s fossil fuel economy and its carbon market ambitions. In April 2026, the NUPRC issued a landmark directive requiring all upstream oil and gas companies to implement systems for measuring, reporting, and verifying methane and greenhouse gas (GHG) emissions. The directive sets a phased timeline: companies must move from basic IPCC Tier 1 estimation methods to Tier 2 by the third quarter of 2026, and fully adopt Tier 3 or equivalent advanced standards by January 2027. This is a positive development, and the NUPRC deserves credit for issuing it. However, the same NUPRC directive acknowledges that the Commission observed ‘technical capacity limitations and infrastructural MRV gaps’ during implementation. And the underlying problem is deeper than technical capacity. The Natural Resource Governance Institute (NRGI), in a September 2024 report, documented that Nigeria’s MRV system primarily relies on self-reporting, that independent and empirically verified measurements are scarce, and that there is a ten-fold variance between the lowest and highest estimated methane emissions reported by the government and third-party sources. A ten-fold variance. That is not a marginal error — it is a credibility crisis. The NUPRC must make all emissions data submitted by oil and gas companies publicly accessible on its website and through the NEITI audit process. It must also mandate independent third-party verification of self-reported data immediately, as the carbon market’s credibility depends on credible enforcement.

The National Environmental Standards and Regulations Enforcement Agency (NESREA): NESREA, established under the NESREA Act 2007, is the agency responsible for enforcing environmental standards across all sectors except the upstream oil and gas sector (which falls under NUPRC). Its mandate places it directly in the path of carbon market enforcement — especially for forestry, agriculture, and waste management projects, which are among the most promising sectors for carbon credit generation in Nigeria. NESREA’s reach into states and communities makes it a critical link between national policy and local implementation. Yet NESREA rarely features prominently in Nigeria’s carbon market conversations. It operates with a relatively modest budget, and its enforcement record across Nigeria’s states and rural communities has been uneven. For NESREA to be an effective partner in the carbon market, it must be resourced adequately, its officers must be trained on carbon credit verification, and it must be integrated into the MRV framework in a structured way. The agency must step into the carbon market conversation loudly and with urgency, as community-level enforcement is where the integrity of this market will ultimately be won or lost.

Red Flag: The wide public awareness gap

Public awareness and effective stakeholder engagement are legal obligations that are being regarded as afterthoughts rather than as integral. Failing in this duty begets consequences that go far beyond regulatory embarrassment to community disempowerment and citizen disillusionment. Section 26 of the Climate Change Act 2021 explicitly mandates collaboration between the NCCC and relevant Ministries, Departments and Agencies (MDAs) to incorporate climate change across educational disciplines and integrate it into the national education curricula at all levels. The Secretariat is further obligated to promote climate education and to partner with civil society organizations for this purpose. The Act also directs the NCCC to cooperate with MDAs, civil society, women’s groups, and youth organizations in climate advocacy and related initiatives. These are legal mandates. And yet, the reality on the ground is that public awareness of Nigeria’s carbon market among ordinary Nigerians, particularly in rural areas, forest communities, and farming households, is nearly nonexistent. Community-based organizations in the Niger Delta, foresters in Cross River, pastoralists in the North, and fisherfolk in the South-South have little or no understanding that there is now a national policy under which the actions they take to protect their forests, reduce emissions, or adopt clean cooking could generate carbon credits worth real money. This is not an abstract problem. Africa’s carbon market history is littered with cautionary tales in which international buyers purchased carbon credits at discount rates while the host communities that preserved the forests, or reduced the emissions, received minimal revenue or none at all. Nigeria’s own framework documents acknowledge this risk. The NCMF explicitly introduces benefit-sharing mechanisms. But benefit-sharing only works if the beneficiaries know the system exists, know their rights within it, and have the capacity to claim those rights. The Open Government Partnership (OGP) Nigeria commitment on implementing the Climate Change Act explicitly listed awareness campaigns on climate change adaptation and mitigation as a programmatic commitment — with specific targets for the number of communities reached and stakeholders engaged. The question is: what has been achieved against those targets, and who is publishing that data publicly? We conclude this first in the series by calling on duty bearers in government to launch an aggressive, multilingual, community-facing carbon market sensitization campaign immediately. The deepest rural areas and traditional rulers, community leaders, and local government councils must be engaged. The integrity of Nigeria’s unfolding carbon market demands this. Urgently. And SOStainability will keep the vigil until the right things are done and real impact reported. 

Spotlight

How States Measure up for Transition Opportunities (1)

The race for a secure and economically prosperous Nigeria will not be won at the centre alone. States that can turn their natural resources, human capital, and policy vision into engines of a low-carbon and inclusive economy are sure to play an integral role.

For decades, discussions about economic prosperity in Nigeria revolved around crude oil. States were often judged by the size of federal allocations they received or the volume of hydrocarbons beneath their soil. Today, however, a different reality is emerging. As the world gradually moves towards cleaner energy systems, climate-resilient industries, digital economies, sustainable agriculture, and green infrastructure, the question is no longer whether transition is happening. The question is which states are prepared to seize the opportunities it presents.

Nigeria’s Energy Transition Plan seeks to achieve net-zero emissions by 2060 while simultaneously addressing poverty, unemployment, and energy access challenges. The plan estimates that the transition could create as many as 840,000 jobs by 2060, lift 100 million Nigerians out of poverty, and unlock hundreds of billions of dollars in investments across power, transportation, industry, cooking energy, and oil and gas value chains.

Yet the opportunities embedded within this transition will not be distributed equally. Some states possess natural advantages, stronger institutions, greater economic diversification, and better infrastructure. Others remain trapped in old economic models, weak revenue bases, and governance challenges that may leave them behind. The transition story of Nigeria, therefore, is ultimately a story of states.

Understanding the New Opportunity Landscape

Transition opportunities extend far beyond renewable energy. They include solar manufacturing, clean cooking solutions, electric mobility, sustainable agriculture, green mining, climate-smart infrastructure, carbon markets, agro-processing, ecosystem restoration, and green industrialization. The 2024 Energy Transition Plan projects significant growth in renewable energy deployment, with solar power expected to become the dominant source of electricity generation over the coming decades. Renewable energy technologies are projected to account for over 80 percent of generation capacity by 2050, with solar capacity reaching unprecedented levels. This creates a new economic geography. States with abundant solar irradiation, hydropower resources, agricultural residues, strategic transport corridors, and industrial clusters stand to gain enormously. The transition will therefore create winners and losers not because some states are naturally disadvantaged, but because some are moving faster than others.

Lagos: The Clear Front-Runner

No discussion of transition readiness can begin anywhere other than Lagos. Although Lagos possesses limited renewable energy resources compared to many northern states, it compensates through economic strength, innovation ecosystems, infrastructure, financial services, and policy experimentation.

Lagos remains Nigeria’s largest internally generated revenue economy, generating over ₦1.26 trillion in IGR according to recent National Bureau of Statistics data.This fiscal strength gives the state a unique advantage in financing climate infrastructure, mass transit systems, electric mobility projects, green buildings, and distributed renewable energy solutions. More importantly, Lagos has demonstrated a willingness to experiment. Investments in bus rapid transit systems, water transportation, waste-to-value initiatives, and urban resilience programmes indicate that the state understands the economic implications of climate adaptation and low-carbon growth. In the transition economy, capital follows confidence. Lagos currently enjoys the highest level of investor confidence among Nigerian states.

Niger State: Nigeria’s Renewable Energy Giant

If Lagos leads through finance and innovation, Niger State leads through natural resource endowment. Few states possess Niger’s strategic advantages. The state hosts major hydropower assets and occupies a critical position in Nigeria’s electricity ecosystem. Investment authorities describe Niger as the “Power State of Nigeria,” with enormous opportunities across hydropower generation, transmission, irrigation-linked energy systems, and renewable infrastructure. As Nigeria seeks to expand hydropower alongside solar energy, Niger State could become one of the country’s most important energy transition hubs. And beyond electricity generation, the state also possesses vast agricultural land suitable for climate-smart agriculture, bioenergy production, and agro-processing industries. The challenge for Niger is not opportunity but execution.

Kaduna: Manufacturing and Industrial Transition Potential

Kaduna occupies a unique position within Nigeria’s industrial geography. Its proximity to major northern markets, relatively developed industrial base, transportation links, and growing technology ecosystem place it among states with significant transition prospects. The state’s opportunities lie less in energy production and more in industrial decarbonization. As global markets increasingly demand low-carbon products and sustainable supply chains, Kaduna could position itself as a manufacturing centre powered by cleaner energy systems. Its agricultural value chains also create opportunities for biomass energy, sustainable agro-processing, and climate-resilient food systems.

Flakes and Flaks

NZIP and the creeping ‘plan’ fatigue

A common bane of public policy and governance in Nigeria is the availability (sometimes the multiplicity) of plans without action. There have always been national development plans – some with bogus slogans and appealing acronyms. Many of them end up gathering dust on the shelves of government offices. This bad habit must be avoided when addressing the climate crisis and in our approach to the burgeoning green economy. 

Recently, the National Council on Climate Change (NCCC) launched the Net Zero Investment Plan (NZIP) with support from the Government of Germany. For context, the 2024 Nigeria Energy Transition and Investment Plan is regarded by stakeholders as a very detailed and technically grounded roadmap for Nigeria’s climate economy. Because there appears to be no publicly accessible NZIP document on the NCCC’s website or other government repositories, it is impossible to make a comparison. What is worth noting, however, is that the ETIP, developed with support from the United Nations’ Sustainable Energy for All (SEforAll), provides sector-by-sector modelling, investment estimates, technology pathways, and policy recommendations. What is also clear is that Nigeria cannot achieve its net-zero ambition without attracting large-scale domestic and international capital. Any cogent and plausible plan that focuses on creating an enabling environment for climate investments, de-risking projects, strengthening carbon markets, and directing private finance into renewable energy, clean transport, sustainable agriculture, and other low-carbon sectors must be followed through with diligent implementation and not duplication.

For further context, the ETIP models pathways across power, transport, industry, cooking, hydrogen, and oil and gas. The plan projects universal electricity access, large-scale deployment of solar power, electrification of transport, adoption of green hydrogen in industry, and a gradual phase-out of high-emission technologies. A key strength of the ETIP is that it quantifies the transition. It estimates that Nigeria would require about $1.37 trillion in cumulative investments between 2020 and 2060, representing roughly $500 billion above a business-as-usual pathway. The plan further argues that these investments would generate approximately $686 billion in fuel-cost savings, making the transition economically attractive over the long term. The ETIP even projects that although the oil and gas sector could lose around 110,000 jobs by 2050, the broader transition could create approximately 840,000 additional jobs, particularly in power and transport. The ETIP assumes a significant role for natural gas during the transition period, particularly in power generation and industry, before hydrogen and other low-carbon technologies become dominant. So, what are the new elements the NZIP is bringing on board? Would the concerned authorities please publish the NZIP for clarity? No need to begin a journey that leads to avoidable fatigue.

SOS Alert

“What is happening in Nigeria is a cancer that has become malignant, with pustules everywhere—in Edo, Rivers and Lagos—and it is growing. Such impunity sends a chilling message to workers and trade union representatives throughout Nigeria and undermines the protection guaranteed under Article 1 of Convention No. 98. As it stands, internal mechanisms for redress have failed, necessitating external intervention.”

• Joe Ajaero, President of the Nigeria Labour Congress (NLC), addressing delegates at the the 114th International Labour Conference in Geneva, recently