Kenya

Kenya is a sovereign and democratic state founded on the supremacy of the Constitution of Kenya (2010). In Kenya, the Constitution reigns supreme and any law inconsistent with it is void to the extent of the inconsistency. Furthermore, it recognizes that the general rules of international law and any treaty or convention ratified by Kenya form part of its law. As a signatory to the Paris Agreement, Kenya is committed to contributing to global efforts to limit the increase in average global temperature to well below 2°C above pre-industrial levels and to pursuing efforts to limit the temperature increase to 1.5°C. In line with this commitment, Kenya has developed a comprehensive approach to address climate change through various laws, policies, and institutional measures.

The Constitution of Kenya, promulgated in 2010, enshrines the right to a clean and healthy environment in Article 42. This guarantees every individual the right to a clean and healthy environment. Article 69 further mandates the state to ensure sustainable exploitation, utilization, management, and conservation of the environment and natural resources. Article 70 provides for the enforcement of environmental rights, allowing individuals to seek legal redress if their right to a clean and healthy environment is violated.

Furthermore, to operationalize its constitutional commitments, Kenya has enacted several statutes. The Climate Change Act of 2023 provides a framework for mainstreaming climate change responses into development planning. It establishes the National Climate Change Council, responsible for coordinating climate actions and development of National Climate Change Action Plans. The Environmental Management and Coordination Act (“EMCA”) CAP 387, serves as the principal governing law when it comes to environmental impact assessments, audits, and compliance with climate-related standards. The Forest Conservation and Management Act of 2016 aims to enhance forest conservation, which is critical for carbon sequestration and climate resilience. The Energy Act of 2019 promotes renewable energy sources and energy efficiency, aligning energy policy with climate objectives.

Kenya has also developed comprehensive policies to complement its legislative framework. The National Climate Change Action Plan (“NCCAP”) outlines priority actions for climate mitigation and adaptation, including renewable energy expansion, reforestation, and climate-smart agriculture. The National Adaptation Plan (“NAP”) focuses on enhancing climate resilience in key sectors such as water, agriculture, health, and infrastructure. The Kenya Green Economy Strategy and Implementation Plan (“GESIP”) integrates climate change into broader economic planning, promoting green growth and sustainable development.

Several institutions play pivotal roles in implementing climate policies in Kenya. The National Climate Change Council (“NCCC”) oversees and coordinates national climate actions, ensuring alignment with international commitments under the Paris Agreement. The National Environment Management Authority (“NEMA”) enforces environmental regulations, including those related to climate change.

Kenya has also developed its Intended Nationally Determined Contribution towards achieving the objectives of UNFCCC as set in Article 2 of the Convention and submitted to UNFCCC secretariat prior to the Paris conference. The INDC will contribute towards the delivery of the Constitution of Kenya 2010 and the attainment of Vision 2030, the country’s blueprint.

Generally, Kenya has taken steps to mitigate the risks of climate change and reducing carbon emissions. The country's dedication to tackling environmental challenges is evident in its extensive legal and policy framework. Additional efforts and initiatives are explored in the following sections of this chapter, highlighting Kenya's dedication in implementing the Paris Agreement and fulfilling its constitutional obligations to ensure a sustainable and healthy environment for current and future generations.

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a) GDP and capital wealth

According to World Bank's 2023 press release, Kenya, recognized as one of Africa's fastest-growing economies, experienced accelerated real GDP growth, expanded an estimated 5.4% in 2023 from 4.8% in 2022. According to World Economics, Kenya's GDP stood at $473 billion by the end of 2023 in purchasing power parity. The Kenya National Bureau of Statistics reported a 5.9% growth in real GDP in the third quarter of 2023, compared to 4.3% in 2022. World Economics Kenya Income & Asset Wealth Report indicates Kenya's asset wealth per capita at 1.4%. In 2022, Kenya's GDP was $113.4 billion, while as of Q1 2023 according to the Kenya National Bureau of Statistics, the sectors contributing significantly to GDP growth included accommodation and food services (+21.5%), transport and storage (+6.2%), agriculture, forestry & fishing (+5.8%), financial and insurance activities (+5.8%), and wholesale and retail trade (+5.7%). Kenya's urban areas typically boast higher incomes compared to rural areas, resulting in a GDP per capita of 2099 PPP Dollars, placing Kenya in the low middle-income country category.

b) Level of unemployment (general and youth)

According to the Federation of Kenya Employers, Kenya has a high rate of youth unemployment, both in urban and rural areas. During the Covid-19 pandemic, in the second quarter of 2020, unemployment reached its peak at 10.4% among the population aged 15-34 years. Later in 2022, the unemployment rate decreased from 5.3% in the third quarter to 4.9% in the fourth quarter. The Federation of Kenyan Employers reports that the overall unemployment rate in Kenya is at 12.7%, where the youth between ages 15-and 34-year-old forms 35% of the Kenyan population have the highest unemployment rate of 67%.

c) Human wealth, population and education

Kenya, with a substantial and diverse population totaling around 56,700,00 as of September 2024, holds a pivotal role in shaping and executing policies concerning climate change. Despite this, the concepts of carbon credits and achieving net zero emissions remain relatively novel to its populace. With an adult literacy rate of 82.88%, Kenya acknowledges the paramount importance of an educated and informed citizenry in the transition towards a net-zero emissions future. Consequently, the country is steadfast in its efforts to raise public awareness regarding climate change and has initiated programs such as tree planting to further this goal.

Kenyans have diverse opportunities to generate or earn income, reflected in the country's gradual economic growth. As of 2023, the average monthly income in Kenya is approximately 20,123 Kenyan Shillings (“KES”) (around $150 US Dollars), demonstrating an improvement in general income levels post-pandemic. This rise in income has helped Kenya maintain its lower-middle-income status as classified by the World Bank. However, income distribution is uneven, with a significant gap between the wealthiest and the poorest. Approximately 40% of the formal sector workforce earns below 50,000 KES per month, highlighting the disparities in earnings across different sectors and regions.

The average household income varies significantly based on occupation, location, and other socio-economic factors. Urban areas like Nairobi and Mombasa generally report higher incomes compared to rural regions. For instance, the average salary in Nairobi is about 3.89 million KES per year (around $30,000 US Dollars), whereas in rural areas, incomes can be significantly lower. The national minimum wage, set by the government, also varies by region and sector, with urban workers earning a minimum of around 13,572 KES per month (around $100 US Dollars).

Economic inequality remains a significant issue in Kenya. The wealthiest 10% of the population earn 23 times more than the poorest 10%, and a small group of super-rich individuals holds a disproportionate amount of the country’s wealth. This inequality is also reflected in the concentration of wealth in major urban centres like Nairobi, Kiambu, and Mombasa, which are among the richest counties in terms of GDP contribution and household income.

The adult literacy rate of 82.88% underscores the importance Kenya places on education as a tool for economic empowerment and societal development. Education is a key factor in accessing higher-paying jobs and improving overall income levels. Efforts to enhance educational opportunities, particularly in rural areas, are crucial for reducing income disparities and promoting inclusive economic growth.

d) Natural wealth, including metals and minerals deposits (such as critical mineral resources, rare earth elements and green/battery minerals and metals) and other natural resources

Kenya is endowed with a variety of natural resources. While the country does not have an extensive history of mining compared to some other African nations, there have been increasing efforts to explore its mineral wealth.

• Soda Ash

Kenya is one of the leading producers of soda ash, a crucial raw material used in the production of glass, chemicals, and detergents. Lake Magadi, located in the Rift Valley, is home to significant soda ash deposits.

• Fluorspar

Kenya has notable deposits of fluorspar, which is used in the production of aluminium, gasoline, and uranium fuel. The Kerio Valley is a major fluorspar-producing region in Kenya.

• Titanium

Kenya has substantial titanium deposits, primarily in the coastal areas, particularly in Kwale County. Titanium is a critical mineral used in the production of paint, plastics, and high-strength alloys.

• Gold

There are gold deposits in various regions of Kenya, with some mining activities taking place. The Migori region, in southwestern Kenya, is known for gold exploration.

• Rare Earth Elements

Kenya has shown interest in exploring rare earth elements, which are essential in the production of electronics and green technologies. Kenya’s profile as a potential top rare earth minerals producer rose a rung higher after mineral explorer Cortec announced it had found deposits worth USD 62.4 billion. Mrima Hill, in Kwale County, has one of the top five (5) rare earth deposits in the world. The area also has niobium deposits estimated to be worth $35 billion.

• Limestone

Kenya has abundant limestone deposits, which are crucial for the production of cement.

• Oil and Gas

Kenya has made significant discoveries of oil in the Turkana region, with ongoing exploration activities. The country is exploring the potential for commercial production of oil and gas.

• Renewable/green energy wealth (opportunities and requirements)

Kenya has made significant strides in transitioning to clean and affordable energy sources, with approximately 90% of its electricity now being generated from green sources such as geothermal, wind, solar, and hydroelectric power. Geothermal energy plays a crucial role, making Kenya the eighth largest producer globally and the foremost in Africa, contributing to nearly half of its energy output. However, challenges, including climate change-induced fluctuations in hydropower reliability, have prompted the government to diversify its energy mix, aiming for hydropower to constitute only 5% of total capacity by 2030. Solar energy projects, like the Garissa Solar Power Plant, have been instrumental in reducing energy costs and enhancing sustainability. Legal and institutional reforms coupled with significant investments in wind power, exemplified by the Lake Turkana Wind Power Project, underline Kenya's commitment to renewable energy development. Promoting public-private partnerships, as demonstrated by the Lake Turkana Wind Power Project, stands out as a key policy avenue, reducing reliance on fuel imports and driving sustainable energy growth.

• Carbon removal or reduction wealth

Kenya has embraced carbon markets as a lucrative opportunity, supported by a robust legal framework. The nation's strategic approach to compliance markets and operational standards is bolstered by a robust measurement and verification system. With potential to restore vast hectares of land, Kenya is poised to generate significant carbon credits, particularly through forest landscape restoration and renewable energy projects. The recent Kenya Carbon Market Roundtable highlighted the nation's potential to mitigate approximately 30 Mt CO2e/yr, translating into substantial economic opportunities.¹  Notably, Kenya's proactive measures have led to the issuance of a 26 Mt CO2e of carbon offsets from 2016 to 2021, positioning the country as a leader in the African context. The enactment of the Climate Change (Amendment) Act 2023 further underscores Kenya's commitment, establishing a carbon registry to oversee carbon credits and markets, thus driving wealth creation and incentivizing carbon farming among farmers and investors.

_{1 Earth Hour: New report explores the local carbon market in Kenya <https://therockgroup.biz/publication-change-the-story-report/>.}

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Nationally Determined Contributions (“NDCs”) are at the heart of the Paris Agreement and the achievement of its long-term goals. Article 4(2) of the Agreement requires each Party to prepare, communicate, and maintain successive NDCs that it intends to achieve. Kenya being a signatory of this Agreement submitted its NDC on 28 December 2016. It provides for Kenya's adaptation and mitigation contribution response to climate change. Kenya’s NDC 2020-2030 seeks to reduce greenhouse gas emissions by 32% by 2030, through initiatives such as increasing the share of renewable energy contribution to the national grid.

a) Undertaking, including key dates and caveats;

Kenya aims to achieve a net-zero carbon-neutral economy by 2050, as outlined in its 2020 Updated NDC. The NDC prioritizes seven key areas, including disaster risk management, food security, water and blue economy, forestry, wildlife and tourism, health, sanitation, human settlements, manufacturing, energy, and transport, to promote sustainable development. The plan includes reducing emissions by 32% by 2030, with implementation running from January 2021 to December 2030, targeting milestone achievements by 2025.² However, Kenya's efforts are contingent on substantial international support, with the country aiming to cover 13% of its budget and relying on 87% international assistance to meet its $62 billion US Dollar target.

b) Use of net zero wealth for own target;

Climate change has adversely affected Kenya's economy, with annual GDP losses estimated between three and five percent. However, transitioning to a net-zero economy presents economic opportunities, particularly in renewable energy, leveraging Kenya's abundant natural resources. This shift allows for industrialization and economic growth without reliance on fossil fuels, fostering new opportunities in global energy and technology markets. Initiatives like the Kenya Climate Innovation Centre support green growth by facilitating investments and promoting startups addressing climate challenges. Kenya's commitment to green growth is further demonstrated through policies promoting climate finance, green bonds, and fiscal incentives for renewable energy investments. Meeting net-zero targets could yield significant economic benefits, estimated at USD 45 billion by 2030, while enhancing food security, environmental quality, and natural resource productivity.

c) Existing collaboration among countries and opportunities for future collaboration;

Existing Collaborations

• The Net Zero by 2050 Partnership by the UNDP to deliver the UNDPs Climate Promise in Kenya and other countries. UNDPs partnership with German Corporation for International Cooperation (“GIZ”) also to deliver on UNDPs Climate Promise in Kenya and other countries.

• The Mission Innovation Initiative, which is a global initiative seeking to accelerate the progress towards the Paris Agreement by making clean energy affordable, attractive and accessible for all.³ It is made up on 23 countries, and the European Commission. Its partners include: the World Bank Group, Breakthrough Energy, World Economic Forum, International Renewable Energy Agency, just to name a few.  

• The International Solar Alliance, which is a next Decade Action Agenda to advance SDG7 on sustainable energy for all, in line with the goals of the Paris Agreement. It is a collaborative effort between countries like the USA, Italy, India, Ethiopia, Burundi, Egypt, Malawi and Mali.  

• The Carbon Neutrality Coalition brings together countries that aim to meet the long-term objectives of the Paris Agreement. Member countries include Andorra, Austria, Canada, Chile, Ethiopia, Fiji, Finland, Korea, Spain etc.

• The Zero Emission Vehicle (“ZEV”) Alliance, which is a collaboration of national and subnational Governments working together to accelerate adoption of ZEVs. Member states include Austria, Canada, Chile, Costa Rica, Germany, Netherlands, New Zealand, Norway, Québec, Switzerland, the United Kingdom and the United States.

The Global Green Growth Institute (“GGGI”). GGGI was established as an international intergovernmental organization in 2012, at the Rio +20 Conference. Members include Angola, Australia, Burkina Faso, Ethiopia, Fiji, Papua New Guinea etc.  

Opportunities for future collaborations  

• Renewable Energy Partnerships. Countries can collaborate on developing and sharing renewable energy technologies, such as solar, wind and geothermal to accelerate the transition to clean energy sources. Examples are: Sustainable Energy Fund for Africa by the African Development Bank Group, the Southern African Renewable Energy Investment and Growth by REEEP, the Africa-EU Energy Partnership, the African Renewable Energy Alliance, the Africa Renewable Energy Initiative and lastly the new Africa Renewable Energy Manufacturing Initiative of 2023.  

• Green Financing Initiatives. Collaborations can be formed to mobilize financial resources and investments for sustainable projects, such as renewable energy infrastructure and energy efficient programs. For example, the Green Bank initiative by the African Development Bank.

• Climate Resilience Partnerships. Collaborations can focus on building resilience to climate change impacts such as developing early warning systems, implementing adaptation strategies and sharing resources to mitigate the effects of extreme climate conditions. For example; the African Climate Action Partnership.

_{2 State Department of Energy, Climate Investment Funds  Renewable Energy Integration Program Investment Plan For Kenya <https://energy.go.ke/sites/default/files/KAWI/Other%20Downloads/CLIMATE%20INVESTMENT%20FUNDS%20DRAFT%20PLAN%2010-11-2023_0310.pdf>.}

_{3 Mission Innovation  <https://missioninnovation.net/#:~:text=Mission%20Innovation%20is%20a%20global,attractive%20and%20accessible%20for%20all >.}

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Kenya aims to achieve a net-zero carbon-neutral economy by 2050, and as a result, several policies and action plans are already in place to address the Climate Change Sector. These include:

• The National Climate Change Action Plan (“NCCAP”) (2018 – 2022).

• Kenya Energy Transition & Investment Plan (2023 – 2050).

• Kenya adopted the electric vehicle pledge at COP26. While it did not commit to the 2040 target, Kenya agreed that it will accelerate the transition to zero emissions vehicles in their market.

The 2020 National Energy Efficiency and Conservation Strategy of 2020, enacted by the Ministry of Energy. The Ministry of Energy has worked with the Kenya Association of Manufacturers to establish a Centre for Energy Efficiency and Conservation that promotes energy efficiency in private sector companies and public institutions such as government buildings.

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Kenya’s legal system is based on statutory law, English common law as well as other forms of laws that are constitutionally recognized.

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a) Legal framework

Kenyan legal framework is constituted by way of hierarchy as follows:

a. The Constitution, 2010;

b. Acts of Parliament and their attendant legislation i.e. Rules, Guidelines, Codes;

c. Judicial Precedent;

d. Customary Law;

e. General Rules of International Law;

f. Ratified Treaties and Conventions.

b) Structure of the judiciary

Structure of the Judiciary is split into two broad divisions: superior courts and subordinate courts.

The Superior courts comprise of the following:

a. The Supreme Court;

b. The Court of Appeal;

c. The High Court whose divisions include: Civil; Constitutional; Tax and Commercial.

In Kenya, the Employment and Labour Relations Court, and Environmental and Land Court have similar status to the High Court.

The Subordinate Courts include:

a. Magistrates Courts;

b. Kadhis Courts;

c. Courts Martial;

d. Small Claims Court;

e. Tribunals.

c) Jurisdiction of national courts and tribunals to hear and determine judicial review applications regarding Environmental Protection, standard of review applicable, time frame, and available remedies in judicial review applications

Regarding judicial review, the High Court has original and appellate jurisdiction to hear and determine judicial review applications regarding decisions from subordinate courts. According to the Civil Procedure Rules, 2010, a party must submit a judicial review application within six months after the administrative body renders its decision.

The Environment and Land Court hears and determines all disputes relating to environmental protection and land disputes, Judicial review applications must generally be filed within 30 days from the date of the decision, though the exact timeline can vary based on the specifics of the case and the rules applicable to the court. The National Environment Tribunal determines appeals on decisions made by the National Environment Management Authority as mandated by the Environmental Management and Co-ordination Act, 1999  establishing the Authority. Appeals to the National Environment Tribunal must be lodged within 30 days from the date of the decision by the National Environment Management Authority.

The courts have the jurisdiction to exercise judicial review where:

i) The decision maker was not authorised to act or acted beyond the scope of their power;

ii) Failure to comply with a mandatory and material procedure or provision;

iii) The action or decision was procedurally unfair; was materially influenced by an error in law; made in bad faith; was taken to prejudice the applicant;

iv) The action or decision is unreasonable; unfair; disproportionate; violates legitimate expectations or fails to take into account relevant considerations.

The available remedies are:

a. An order of mandamus mandating a certain action be carried out;

b. An order of certiorari to quash a prior judgment, order, decree, conviction or other proceedings;

c. An order of prohibition restraining persons from carrying out certain actions.

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a) Constitution

As per the Fourth Schedule of the Constitution, the National Government is responsible for addressing Energy Policy matters, such as electricity and gas reticulation, and energy regulation. Meanwhile, County Governments are tasked with county planning and development, which also includes electricity and gas reticulation and energy regulation. Notably, energy constitutes a shared function between the National and County Governments.

b) Climate law framework, including:

1. Environmental laws

• The Environmental Management and Co-ordination Act, CAP 387

• The Environment and Land Court Act, 2011

• The Fisheries Management and Development Act, 2016

• The Mining Act, CAP 306

• The Physical Planning Act, CAP 286

• The Public Health Act, CAP 242

• The Radiation Protection Act, CAP 243

• The Sustainable Waste Management Act, 2022

• The Maritime Zones Act. CAP 371

• The Natural Resources (Classes of Transactions Subject to Ratifications) Act, 2016

• The Plant Protection Act, CAP 324

• The Protected Areas Act, CAP 204

• The Protected Areas (Amendment) Order, 2016

• The Physical Land Use and Planning Act, 2019

• The Water Act, 2016

• The Wildlife Conservation and Management Act, 2023

• The Forest Conservation and Management Act, 2016

• The Biosafety Act, 2009

• The Coastal Development Authority Act, CAP 449

2. Air-quality focused laws

• The Environmental Management and Co-ordination (Air Quality) Regulations, 2014

• Air Quality Regulations, 2014

• The Public Health Act, 2012

3. Climate change-specific law(s)

• The Climate Change Act, 2023

• The Climate Change (Amendment) Act, 2023

• The United Nations Framework Convention on Climate Change and the Paris Agreement

4. Energy laws that consider climate change issues, including renewable energy

• The Petroleum Act, 2019

• The Energy Act, 2019

• The Nuclear Regulatory Act, 2019

5. Licencing, authorisations and permitting requirements

Each law mentioned above has its own licensing, authorisation and permitting requirements.

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The Climate Change Act, 2023 (CAP 387A).

The Climate Change Act, 2023 was significantly amended in 2023 to provide for the regulation of carbon markets and a framework for carbon trading; and to introduce pioneering provisions aimed at aligning Kenyan law with its international climate commitments.

• Both Government and private promoters can engage in carbon trading through either bilateral or multilateral trading agreement vehicles. The Act also offers a complete approach to emissions mitigation through carbon reduction credits, removal or sequestration credits, technologies, and projects on the whitelist, and emphasises the significance of carbon removal and sequestration strategies (including afforestation, reforestation, nature-based solutions, and advanced removal technologies).

• The Act establishes a National Carbon Registry (“the Registry”), which will be maintained by the Designated National Authority. Kenya’s DNA is the National Environment Management Authority (NEMA).

• The Act requires every land-based project to have a Community Development Agreement (“CDA”) in place. Any dispute under a land-based project will be subject to the dispute resolution mechanism set out in the CDA. Where any of these disputes have not been resolved within 30 days the dispute is to be referred to the National Environmental Tribunal.

• The Act establishes a framework for addressing a range of actions that undermine the integrity of carbon trading. These violations include: (a) willingly conducting unauthorised trade in carbon credit; (b) knowingly giving false or misleading information with respect to environmental or financial gains from the carbon market investment; (c) manipulating carbon credit measurements to claim additional measurements; (d) engaging in money laundering through carbon trading; (e) knowingly selling carbon credits to unauthorised entities; or (f) failing to maintain carbon records.

• Introduction of provision of social and environmental benefits carbon trading permits for individuals engaging in carbon credit trading in voluntary or compliance markets, including operation of a carbon trading exchange.

• Implementation of the sharing of the benefits from the carbon markets and carbon credits between national and county governments, communities, and project proponents, for various carbon resources.

• Establishment of a National Carbon Registry for permits, projects, community development agreements, and purchase agreements.

The Climate Change (Carbon Markets) Regulations, 2024

• The Regulations aim to facilitate carbon projects by providing guidance on emissions reduction and removal activities. They support both compliance and voluntary carbon markets, ensuring environmental integrity, and set standards for participation.

• A Designated National Authority (“DNA”) is responsible for overseeing carbon markets, including reviewing project concept notes, issuing approvals, and ensuring compliance with international carbon standards while the Climate Change Directorate provides technical support, policy advice, and coordinates stakeholder involvement.

• A multi-sectoral technical committee and ad hoc committees offer technical advice on carbon projects, with members from relevant ministries and government agencies.

• A National Carbon Registry is established to track all carbon projects. It is managed by the National Registrar, who ensures confidentiality and submits regular reports. Sector-specific registries are created for carbon projects in areas like energy, forestry, and waste management. Each sector has a designated Registrar.

• Projects must comply with sector-specific standards and undergo independent certification, validation, and verification.

• Project proponents must demonstrate technical and financial capability, meet legal requirements, and ensure community engagement and benefit-sharing where projects impact community or public land.

• Environmental and social impact assessments are mandatory for new projects, while ongoing projects must conduct environmental audits. Project proponents must apply to the DNA for approval, providing detailed project documentation, including a community development agreement if applicable.

• Projects are authorized through a series of approvals, including a Project Design Document that describes activities, monitoring methodologies, and carbon credit periods. Proponents can request authorization for international transfer of mitigation outcomes, aligning with global carbon market mechanisms.

• Projects on public or community land must contribute annually to local communities. Contributions are set at a minimum of 40% of annual earnings for land-based projects and 25% for non-land-based projects, after accounting for operational costs. Community benefit management is facilitated through a Community Development Agreement, with oversight from local committees.

• The Regulations include dispute resolution mechanisms and confidentiality requirements, with penalties for unauthorized information disclosure. Liability for environmental damage is assigned to project proponents, and transfer of project approvals is restricted unless in cases of change in project control.

• Existing carbon projects must comply with the new regulations within two years, and ongoing projects must conduct environmental audits within six months.

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The Climate Change Act, 2023 – Cap 387A

The Climate Change Act provides a robust legal framework to guide Kenya’s climate actions, promoting a coordinated approach to climate resilience and low-carbon development. Through its institutional structures and integration mandates, the Act aims to position Kenya as a proactive player in global climate change efforts while addressing local vulnerabilities.

• The Act establishes a framework to address climate change by coordinating climate change response actions, facilitating the development of national climate change policies, and promoting climate-resilient development.

• The Act establishes the National Climate Change Council, chaired by the President, to oversee climate change policies and actions, while the Climate Change Directorate situated within the Ministry of Environment, is responsible for the technical coordination of climate change actions, including research, data management, and reporting.

• The Act mandates the creation of a National Climate Change Action Plan every five years. This plan outlines Kenya’s climate change priorities, including adaptation and mitigation actions, technology needs, and resource mobilization strategies.

• Climate Change Duties: Public and private entities are assigned specific duties to integrate climate change considerations into their operations. They must implement measures to reduce greenhouse gas emissions, enhance climate resilience, and report on their progress to the Council. Public entities with climate responsibilities are required to prepare and submit annual reports on their climate actions, including progress on adaptation and mitigation efforts.

• The Act grants the Cabinet Secretary for Environment the authority to issue regulations for implementing climate-related policies and provides for sanctions against entities that fail to meet their climate obligations, including fines and directives to comply with the established climate change requirements.

• A Climate Change Fund is established to support climate change initiatives, including funding for climate adaptation, mitigation, and research projects. The Fund is sourced from government allocations, international funding, and private sector contributions.

• The Act requires all public entities to mainstream climate change into their development plans, programs, and budgeting processes. This ensures that climate change is a core consideration across all sectors, promoting climate-resilient development nationwide.

Mainstreaming climate change responses in development planning

Encouraging low-carbon technologies, enhancing efficiency, and reducing emissions intensity involve facilitating the adoption of technologies supporting low-carbon and climate-resilient development. This necessitates integrating climate change actions into decision-making and implementation processes of sector ministries, state corporations, and county governments when planning involving fossil fuels occurs.

The Climate Change Act, originally enacted in 2016, was amended by the Climate Change (Amendment) Act, No. 9 of 2023, introducing new definitions and inserting several sections to provide a comprehensive framework for addressing climate change. Key definitions include aggregate earnings (total income from a carbon project), carbon budget (approved greenhouse gas emissions over a specified period), carbon credits, carbon market, carbon project, carbon offset, carbon standards among other definitions. Amendments include: guidance in the development and implementation of carbon markets; reviewing and recommending the level of compliance with international climate commitments; identification of past, current and projected sector-based greenhouse gases emission profile; insertion of a new Part focusing on the regulation of carbon markets, including: trade in carbon markets; participation in carbon markets, as a result of a bilateral or multilateral trading agreement; promoting the mitigation of greenhouse gas emissions, while fostering sustainable development; environmental impact assessment; provision of social and environmental benefits; public land-use projects; dispute resolution; fees; offences and penalties.

The Energy Act, 2019

• The Act creates several National Energy Entities including the Energy and Petroleum Regulatory Authority (“EPRA”). EPRA’s functions are set out at Section 10 and includes to develop testing and certification procedures, in conjunction with relevant statutory agencies, for certification and testing for energy consumption of equipment and appliances.  The Authority ensures, in collaboration the Kenya Bureau of Standards, that only energy efficient and cost effective appliances and equipment are imported into the country; and also certifies energy managers and licenses energy auditors.

• In promoting low carbon technologies, improving efficiency, and reducing emissions intensity by facilitating approaches and uptake of technologies that support low carbon, and climate resilient development.

• The Ministry of Energy has established climate change units and climate change related plans and policies to guide them in mainstreaming climate actions in the sector.

• Section 75 and 76 Energy Act provide for promotion of renewable energy and establishment of Renewable Energy Resource Advisory Committee. EPRA have adopted a plan use of the Integrated National Energy Plan (“INEP”) for long term and short term.

• Section 222 of the Energy Act 2019 sets out the powers and functions of the National and County Governments in the Fifth Schedule – the Fifth Schedule sets out the distribution of functions between the National and County Governments.

The United Nations Framework Convention on Climate Change and the Paris Agreement

• Kenya has ratified both the United Nations Framework Convention on Climate Change (“UNFCCC”) and the Paris Agreement, thereupon assuming obligations to plan, take action and report on measures taken to mitigate global warming.

• On this basis, and as a party to the said agreements as mentioned earlier on, the updated NDCs (2020–2030), highlights Kenya's priority actions for adaptation and mitigation

The Climate Change (Public Participation and Access to Climate Information) Regulations, 2023

The Climate Change (Public Participation and Access to Climate Information) Regulations 2023 establish guidelines to promote inclusive public participation and access to climate-related information within Kenya. These Regulations emphasize inclusivity, transparency, and accountability in climate governance, ensuring that public and stakeholder engagement is central to climate-related decision-making and that climate information is readily accessible to all Kenyans.

• Public consultation must be timely, inclusive, and impactful, allowing sufficient engagement and ensuring feedback from stakeholders directly affects decision-making on climate matters.

• Public consultations are mandatory for developing or amending climate change laws, policies, or guidelines.

• Authorities must provide at least a 14-day comment period and ensure equitable access, including measures to accommodate language or disability barriers.

• Before consultations, authorities must publish a “call for comments” to maximize public awareness, utilizing various channels like social media, public meetings, and community engagement.

• Authorities must hold public hearings within a reasonable time after the comments period and ensure all feedback is documented.

• Authorities are required to analyze public feedback objectively, publishing a report detailing decisions made and justifying any recommendations included or excluded.

• The National Climate Change Council and the Climate Change Directorate are responsible for maintaining current climate change information, including national and international policies, trends, and ratified international instruments.

• Authorities must maintain a database of relevant stakeholders, ensuring they include marginalized groups such as women, youth, persons with disabilities, and Indigenous communities. The Directorate is also tasked with preserving Indigenous Knowledge Systems and making them publicly accessible.

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• The Climate Change Act, 2023 and the Public Finance Management Act, 2012 provide a regulatory and legislative framework for climate change mitigation and adaptation in Kenya. The Carbon Tax Bill is another legal instrument that aims to incentivize businesses to reduce greenhouse emissions by reducing the corporate income tax rate for entities that operate a carbon market exchange or emissions trading system that is certified by the Nairobi International Financial Centre Authority, also known as Nifca.

• The Climate Change Amendment Act came into force on 15 September 2023. One of the key considerations for existing and proposed carbon credit projects and carbon trading in the Act include: the requirement to obtain an environmental impact assessment for all carbon credit projects; the requirement to enter into community development agreements for all land-based projects; and registration with the National Carbon Registry.

• There is a social contribution of 40% in land-based projects and 25% non-land-based projects annually applicable to aggregate earnings. The National Treasury released a draft Medium-Term Strategy on 12th September 2023 (“MTRS”). The MTRS is intended to provide a framework for tax reforms and develop a strategy for the Government to enhance revenue mobilization and improve the efficiency of the tax system and tax administration. The MTRS states that the government will explore the possibility of introducing a carbon tax based on the carbon content of fossil fuels.

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Climate and environment, social and governance (“ESG”) risks can be managed through liability-sharing provisions in the purchasing agreement. Examples of the provisions are the following:

• Warranties - To mitigate non-compliance risks with ESG laws, buyers may request warranties to cover undisclosed risks. However, warranties solely addressing general ESG law compliance make only national laws binding. To ensure inclusion of international soft-law standards on net zero emissions, specific references to these provisions in warranties are crucial for their binding effect on the target company. To address potential climate-related lawsuits, warranties asserting the absence of threats or expectations of such lawsuits may be necessary.

• Indemnities - In cases where identified ESG risks remain uncertain in terms of materialization or extent, indemnity clauses in contracts are crucial. It is essential to clearly define the triggering event and its legal consequences in such clauses.

• Earn out clauses - Earn out clauses can be used to make earn out payments contingent on the target company’s ability to achieve specific net zero targets, as an end, or even considering that the achievement of such targets may positively affect the target company’s revenue.

• Insurance clauses - Claims for non-compliance with net zero requirements by the target company can be transferred to third parties, like transaction insurers, via warranty and indemnity insurance. This type of insurance requires a provision stating that the risk realization is improbable and the potential loss for the insurer is significant but quantifiable.

• Dispute resolution clauses - For efficient and appropriate solutions in disputes that may arise regarding ESG risk and particularly those that relate to net zero commitments, parties should agree on dispute resolution mechanisms and procedures.

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The Foreign Investments Protection Act

• It regulates foreign investments in Kenya. Section 3 of the Act stipulates that foreign companies that propose to invest foreign assets in Kenya may apply to the Minister for a certificate that the enterprise in which the assets are proposed to be invested is an approved enterprise for the purpose of the Act.

• It further provides protection for foreign investments such as shielding foreign investors from compulsory acquisition of their property or assets except in accordance with the law on compulsory acquisition.  

The Kenya Investment Policy (“KIP”)

• It was established with the intention of promoting and facilitating private investment in Kenya through attracting and retaining foreign investment. The policy sets out for foreign investment, the challenges faced by foreign investors and proposes strategies and policy measures to mitigate these challenges to promote foreign investment.

Companies Act (17 of 2015)

• A foreign company must register under the Act to operate in Kenya. When issuing securities on Kenyan securities markets, such as the Nairobi Stock Exchange, a minimum of 25% of its ordinary shares must be allocated to local investors. For Initial Public Offerings (“IPOs”), at least 40% of the ordinary shares must be reserved for local investors, with any unsubscribed portion available for allocation to foreign investors upon approval from the Capital Markets Authority. Additionally, companies seeking to acquire or merge with a Kenyan-listed company must set aside a minimum of 25% of ordinary shares for local investors.

Competition Act of Kenya (2010)

Certain foreign investments may trigger a review by the Competition Authority of Kenya under the Act, if the prescribed thresholds are met.

To exemplify, in the mining sector foreign participation is restricted so that 60% Kenyan ownership is required in respect of entities carrying out small-scale mining operations. With respect to large-scale mining investments, 20% equity of the company carrying out the mining operations must be listed in the Nairobi Stock Exchange (“NSE”) within 3 years after commencement of production.

In conclusion, as is common to many countries certain foreign investments may trigger a review by the Competition Authority of Kenya under the Competition Act of Kenya (2010), if the prescribed thresholds are met.

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a) environmental impact assessment law; and

b) relevant consultation law such as public participation in environmental decision making

Constitution of Kenya, 2010

• The State of Kenya has certain responsibilities towards the environment (Article 69 of the Constitution of Kenya) including ensuring sustainable exploitation, utilisation, management and conservation of the environment and natural resources, and ensure the equitable sharing of the accruing benefits; and utilise the environment and natural resources for the benefit of the people of Kenya.

The Environmental Management and Coordination Act, No. 8 of 1999

• The establishment of the National Environmental Management Authority (“NEMA”) is enshrined in law, with its primary mandate being the comprehensive assessment of Kenya's natural resources and their sustainable utilization and conservation. NEMA is tasked with scrutinizing land use patterns to ascertain their influence on the quality and quantity of natural resources within the country.

• It further mandates the carrying out of an Environmental Impact Assessment (“EIA”) in any project that may result in harm to the environment. The Act defines what an EIA is and the procedure for applying for an EIA Licence.

The Energy Act No. 12 of 2012

• It establishes the Energy Regulatory Commission that recognises the need to protect the environment and to conserve the natural resources in accordance with the Environmental Management and Co-ordination Act of 1999 (No. 8 of 1999).

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a) consultation and engagement;

b) public participation; and

c) community grievance mechanisms

The Constitution of Kenya (2010)

Public participation is an essential principle which is engrained in the Constitution:

• Article 10 (2) (a), (b) and (c): The national values and principles of governance include; democracy and participation of the people; inclusiveness; good governance, integrity, transparency and accountability.

• Article 35: The Constitution guarantees the right to access information by citizens. The Access to Information Act gives effect to Article 35 of the Constitution.

• Article 61: Gives the public, individually or as a group, a say in matters of land including acquisition, management, transfer, disposal, or ownership of private, public and/or community land.

• Article 69 (1) (d): The State shall encourage public participation in the management, protection, and conservation of the environment.

• Article 174 (d): Communities have the right to manage their affairs and to further their development.

The Environmental Management and Co-ordination Act

• Under the Environmental Management and Co-ordination Act, it is mandated to publish a notice of an EIA in the Gazette, at least two local newspapers, and broadcasted on the radio in the project area. Subsequently, a period of up to sixty days is allowed for the submission of oral or written comments on the EIA study. Moreover, the Act ensures public participation in environmental decision-making, requiring consultation and engagement with affected communities.

• The NEMA is established under the Environmental Management and Co-ordination Act (“EMCA”) as the principal instrument of Government for the implementation of all policies relating to environment NEMA has developed various regulations that provide for community grievance mechanisms, including the Wetland Regulations. These regulations outline management of wetlands, wetland resources, riverbanks, lake shores and seashores.

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Part IV of the Environmental Management and Coordination Act, 1999

The Act highlights activities that require an Environmental Impact Assessment Licence to be undertaken due to their impact on the environment.

The Environmental Management and Coordination (Conservation of Biological Diversity and Resources, Access to Genetic Resources and Benefit Sharing) Regulations, 2016

The regulations outline measures to protect, and sustainably utilize genetic resources, with a focus on preserving biodiversity, preventing the extinction of species, and ensuring the responsible access and utilization of genetic material.

The Wildlife Conservation and Management Act, 2013

The Act outlines comprehensive provisions for the protection, conservation, and management of wildlife resources. The Act establishes a Wildlife Endowment Fund for conservation initiatives and compensation schemes for damage caused by wildlife. Protected areas, including national parks and marine protected areas, can be established. Landowners may create wildlife conservancies, and the Cabinet Secretary can declare critically endangered, vulnerable, nearly threatened, and protected species.

The Forest Conservation and Management Act, 2016

The Act provides for the creation and management of forests. The Act makes it an offence to fell, cut, take, burn, injure or remove any forest produce from a public or provisional forest without a licence, permit or management agreement.

The Climate Change Act, 2023

The Act establishes duties for both the public and private sector aimed at reducing greenhouse gas emission and combating the effects of climate change.

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Under the Environmental Management and Co-ordination (Waste Management) Regulations of 2006, individuals, or entities responsible for the generation of waste bear the legal obligation for its proper disposal. The EMCA highlights offences relating to hazardous wastes, materials, chemicals and radioactive substances. Offenders of this section are liable upon conviction to a fine of not less than one million shillings, or to imprisonment for a term of not less than two years, or to both.

Section 142 of the EMCA makes it an offence to discharge any dangerous substances into land, water, air, or aquatic environment. Polluters are liable to a fine of not less than less than two million shillings and not more than five million shillings.

In addition, the court may order the polluter to pay the cost of cleaning, clean up the polluted environment or pay any affected third parties.

Under the EMCA, the NEMA may issue a restoration order against any person requiring them to restore the environment as near as it may be to the state in which it was before the taking of the action which is the subject of the order.

Under the Mining Act the holder of a permit or licence is required to ensure sustainable land use and prevent seepage of toxic waste into streams, rivers, lakes and wetlands. A person who violates the requirements under the Act and terms of the licence commits an offence and on conviction liable to a fine of not less than one million shillings or to imprisonment for a term not exceeding three years, or to both an imprisonment term and a fine.

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1. The EMCA requires all project operators to submit an Environmental Impact Assessment Report to the NEMA.
2. The operator must keep accurate records and make annual reports to the NEMA describing how far the project conforms in operation with the statements made in the environmental impact assessment study report.
3. All owners or operators of irrigation project schemes, sewerage systems, industrial production workshops or any other undertaking which may discharge effluents or other pollutants are required to submit on demand, to the Authority accurate information about the quantity and quality of such effluent or other pollutant.
4. More explicit requirements for self-reporting are also set out in sector-specific laws and regulations.
5. The right to access to information under the Access to Information Act may be enforced against any individual including a private entity where it can be demonstrated that the information is necessary for the exercise or protection of any right or fundamental freedom.

a) Duty of compliance and reporting

b) Monitoring Requirements

c) Recordkeeping Requirements

d) Inspection

e) Administrative enforcement

• The Environmental (Impact Assessment and Audit) Regulations set out the reporting requirements under the Environmental Management Act. Every proponent undertaking a project must submit to the NEMA a summary project report of the likely environmental effect of the project and an Environmental Impact Assessment Study which must consider the views of persons likely to be affected by the project.

• Under the Climate Change Act, the Cabinet Secretary is empowered to make regulations governing the nature and procedure for reporting on performance by private entities, including the authority to monitor and evaluate compliance.

• Under section 197 of the Mining Act duly appointed inspectors may enter, inspect and examine land on which prospecting or mining operations are being conducted or land which is the subject of a mineral right.

• Under Section 206 of the Energy Act persons undertaking works under the Act are required to prepare a local content report detailing the added value brought to the Kenyan economy from energy related activities through systematic development of national capacity and capabilities and investment in developing and procuring locally available work force, services and supplies, for the sharing of accruing benefits.

• The Petroleum Act provides for a framework for reporting, transparency and accountability in the upstream petroleum sector.

• The operator of a project must keep accurate records and make annual reports to NEMA describing how far the project conforms in operation with the statements made in the environmental impact assessment study report.

• NEMA is mandated under the Climate Change Act to monitor compliance of private entities with the self-reporting requirements.

• NEMA prescribes in regulations activities for which records shall be kept, contents of the records and manner they shall be kept in various regulations. These records are to be submitted annually to NEMA.

• Under the EMCA, NEMA may appoint inspectors to monitor compliance with the environmental standards, monitor the activities of other sector-specific environmental inspectorates, monitor the pattern of use of environmental resources and conduct audits. These inspectors have the power to institute proceedings for any violations under the act.

• The NEMA is a government regulatory body mandated to coordinate all environmental matters and implement environmental policies. Projects which affect the environment must receive NEMA approval before commencement.

• The National Environment Tribunal also enforces environmental rights/claims involving infringement of environmental rights. Any decision taken by NEMA may be appealed to the tribunal.

• The Environmental and Land Court has jurisdiction to hear disputes relating to the environment and land.

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The Constitution

It emphasizes the equitable sharing of the benefits arising from natural resource exploitation and mandates environmental sustainability. Article 62 delineates public land which includes resources as property of the State, which must be exploited in a manner that benefits the entire nation. Article 69 obligates the state to ensure sustainable exploitation of the environment and natural resources.

The Mining Act, 2016

The Act establishes the legal and regulatory framework for the exploration, extraction, processing, and trading of minerals. It establishes the rights and obligations of mining companies, including licensing requirements, environmental protection measures, and provisions for local community engagement. It also sets up the Mining Cadastre Portal for online applications of mining rights and permits.

The Petroleum Act, 2019

The Act governs the exploration, development, and production of petroleum resources. It outlines the licensing process for petroleum operations, the sharing of revenues between the national government, county governments, and local communities, and environmental protection measures.

The Energy Act, CAP 314

The Act consolidates the laws relating to energy, providing for the exploration, development, production, supply, and use of energy resources. The Act sets out Local Content Requirements which must be met by persons undertaking works under the Act. The Act further empowers the Energy and Petroleum Regulatory Authority to monitor and enforce local content in all energy undertakings and works.

The Environmental Management and Coordination Act and The Environmental (Impact Assessment and Audit) Regulations

The Act and regulations outline the legal and institutional framework for environmental governance and sets out the obligations of persons and companies regarding EIAs, environmental audit and monitoring, and conservation of biodiversity.

The Natural Resources (Benefits Sharing) Bill

This Bill was proposed in 2022 to address the lack of accountability and transparency in natural resources benefit sharing. The Bill is currently in the Third Reading in Parliament.⁴  It proposes a framework for the sharing of benefits of natural resource exploitation between resource exploiters, the national government, county governments, and local communities.

_{4. At the time of publication, there is an indeterminate timeline of when the proposed Bill can be expected to come into law.}

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a) Justiciability

b) Standing

c) Ripeness

d) Exhaustion

e) Finality

f) Political Question

Criminal Sanctions

Part XIII of the EMCA establishes Environmental Offences from which criminal sanctions arise. The general penalty for offences under the Act is imprisonment of a term of not less than one year but not more than four years, or to a fine of not less than two million shillings but not more than four million shillings, or to both. Liability for offences committed by a body corporate is borne by every director or officer who had knowledge of the offence and did not exercise due diligence to ensure compliance with the Act.

Civil Sanctions

A breach of environmental obligations as stipulated in the constitution under Article 70 empowers the Environment and Land Court to grant civil remedies such as compensation to the victim or orders of injunction to prevent, stop or discontinue any Act that is harmful to the environment.

Under the Environmental Management and Co-ordination Act, polluters may be ordered by the court to pay the cost of cleaning, clean up the polluted environment or pay any affected third parties.

Administrative Sanctions

The EMCA empowers the NEMA to revoke, suspend or cancel an Environmental Impact Assessment Licence.

The Constitution of Kenya enshrines the principle that justice ought to be done without undue regard to procedural technicalities. As such there are few limitations on justiciability.

The Constitution recognises that an individual may institute court proceedings on their own behalf and on behalf of other persons in the interest of a class or group or in the public interest. Under Article 22 a petitioner need only demonstrate that a right or fundamental freedom has been threatened or infringed but it need not be any person’s right.

Under Article 22 of the Constitution, a petitioner may approach the Court to prevent an imminent or future violation. As such the principle of ripeness is expanded to beyond the limited scope of actual injury having had to occur.

Petitioners are required to exhaust all statutory mechanisms before approaching the Court.

In the case of environmental issues, the first remedy would be to report the matter to the NEMA or the National Environmental Tribunal before approaching the Environmental and Land Court.

Additionally, the doctrine of constitutional avoidance requires petitioners to first seek ordinary reliefs before raising a constitutional petition.

Litigation must come to an end. An issue raised with NEMA may be appealed as of right to the National Environmental Tribunal and further to the Environmental and Land Court. An appeal against the decision of the Environment and Land Court to the Court of Appeal must be on matters of law and not facts. Appeals to the Supreme Court are limited. The appeal lies as of right in any matter involving the interpretation and application of the constitution and in any other case where the matter is certified as being of general public importance.

The Supreme Court is the final court from which no appeal lies.

However, a party disgruntled by the actions of the state or a state organ may seek redress against the state for a decision taken by the state or a state organ at the East African Court of Justice.

As a general rule, courts do not interfere with matters under the purview of other arms of government. However, there are constitutionally permissible situations where the Court may deal with matters considered political questions, and particularly where a policy decision violates or threatens a right under the Constitution.

Article 163 of the Constitution empowers the Supreme Court to give advisory opinions to the National Government, a State Organ, and County Governments in relation to matters affecting counties. Advisory opinions by the Supreme Court are binding as orders of the Court.

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The Constitution

Article 41 enshrines the rights of employees and employers. It states that every person has the right to fair labour practices, fair remuneration as well as reasonable working conditions. The reasonable working conditions also includes the right to clean and healthy environment and to have obligations relating to the environment fulfilled under Article 70.

Employment Act, 2007

Defines the fundamental rights of employees and the obligations of employers. The Act defines the jurisdiction for disputes under the Act as being dealt with by the Employment and Labour Relations Court.

Labour Relations Act, 2007

This Act consolidates the law relating to trade unions and trade disputes, provides for the registration, regulation, management and democratisation of trade unions and employers organisations or federations and promotes sound labour relations through the protection and promotion of freedom of association, the encouragement of effective collective bargaining and promotion of orderly and expeditious dispute settlement, conducive to social justice and economic development.

Employment and Labour Relations Court Act, 2011

This Act establishes the Court and sets out its jurisdiction as to hear and determine disputes relating to employment and labour relations.

Occupation Safety and Health Act, 2007

The Act provides for the safety, health and welfare of workers and all persons lawfully present at workplaces.

International Labour Organization Conventions

Kenya is party to the ILO by virtue of article 2 (6) of the Constitution of Kenya 2010. ILO is a UN specialized agency at the UN which obligates state parties who are signatories to it in promoting of social justice and internationally recognized labour standards. Additionally, it addresses labour related issues such as employment, social protection and worker's rights.

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The Constitution

The Fourth schedule stipulates that the National Government tackle issues on Energy Policy including electricity and gas reticulation and energy regulation.

The Energy Act, 2019

The Act provides the legal framework for exploration and commercial utilization of geothermal energy. It regulates petroleum and coal activities, regulates the supply and use of electricity and other forms of energy. The Act also promotes the use of renewable energy.

Section 9 of the Act establishes the Energy Regulatory Authority which is the regulatory body for all matters connected to energy.

The Act establishes the rights, duties and obligations of energy project operators.

The Nuclear Regulatory Act, 2019

The Act provides a framework for the utilization of atomic energy and nuclear technology. The Act also prescribes the manner for production and use of radiation sources and the management of radioactive waste.

The Climate Change Act, 2023

The Act establishes a regulatory framework for an enhanced response to climate change, providing mechanisms and measures to achieve low-carbon climate development, and addressing other climate related purposes.

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a) Annulment and cancellation of exploration or exploitation permits

The Mining Act, 2016 regulates the licensing, exploration, work programs, and state participation in the extractives industry in Kenya. The said Act also stipulates the procedure for acquisition of permits and licenses, and the rules and regulations to be followed in conduct of the purpose for which the permits are given. Breach of such terms will result in annulment or cancellation of the permits. Other reasons that may result in the annulment or cancellation of exploration or exploitation permits include:

Non-Compliance with Environmental Standards

Failure to comply with environmental regulations and standards may lead to permit cancellation, as environmental considerations are often a significant aspect of mining activities.

Non-Payment of Fees and Royalties

Non-payment of required fees, rents, or royalties associated with the exploration or exploitation permits could be grounds for cancellation.

Expiration of Permit Term

If the exploration or exploitation permit has reached the end of its designated term and is not renewed, it may be considered expired and subject to cancellation.

National Interest or Public Welfare

Government authorities may reserve the right to cancel permits in cases where it is deemed to be in the national interest or for the public welfare.

Illegal Activities or Violations

Discovery of illegal mining activities, violations of mining laws, or engaging in activities beyond the scope of the permit may result in cancellation.

Community Concerns and Consultation

Public consultation and addressing community concerns are increasingly important in the mining sector. Failure to adequately address community issues or concerns may impact the validity of the permit.

b) Expropriation of property rights by the state

Section 171 of the Energy Act provides for permission to survey land for energy infrastructure. Therefore, any person who wishes to enter upon any land, other than his owner to undertake exploratory activities or surveys relating to the exploitation of energy infrastructure shall seek prior consent of the owner of such land. This provision is also stipulated in the Mining Act.

However, in cases of unreasonably withheld consent, the government reserves the right to initiate compulsory acquisition. The Cabinet Secretary may apply to the government agency responsible for the management of such land to acquire it compulsorily upon satisfaction that the applicant made reasonable attempts to acquire the land whose consent was unreasonably withheld. The procedure for such acquisition is outlined in the Land Act which must attract just compensation.

Compensation could be in terms of alternative land allocation, monetary payment, government bonds, transfer of development rights, equity shares in government-owned entities, or other lawful compensation. The landowner's choice of compensation depends on the valuation.

c) Lawsuits brought against projects

In Save Lamu & 5 others v. National Environmental Management Authority & another (2019) eKLR, members of the community sued NEMA for the issuance of an Environmental Impact Assessment license for a 1050MW coal-fired power plant on the grounds that the project was likely to contribute to climate change and was inconsistent with Kenya’s low-carbon development commitments. The Court ruled in their favour and the license was cancelled. It is, therefore, advisable that entities perform the impact assessment and ensure that the envisioned and probable outcomes of the intended projects do not contradict the low-carbon development commitment.

In KM (Minor suing through Mother and Best-friend SKS) & 9 others v Attorney General & 7 others [2022] Eklr, the petitioners claim that the operation of the lead acid batteries recycling factory set up by the 7th and 8th respondents resulted in toxic waste discharge, which is alleged to have seeped into Owino-Uhuru Village and purportedly responsible for a range of illness among residents, including lead poisoning leading to numerous deaths.

d) Types of Alternative Dispute Resolution available

Exploration or exploitation agreements normally include the process of settlement of disputes and resolution of disputes through international arbitration or a sole expert.

Disputes arising between the permit holder and the affected individuals can be resolved through negotiation in good faith. Other Alternative Dispute Rresolution mechanisms available include mediation, arbitration, and through the Cabinet Secretary.

e) Transparency and corruption risk (with incorporate TI ranking)

While there are laws, rules, and regulations guiding the conduct of business in Kenya, and transparency is one of the national values enshrined in the constitution, corruption remains an issue. According to the 2022 Corruption Perceptions Index (“CPI”) released by TI, Kenya is ranked 123rd out of 180 countries with a score of 32 out of 100.

Corruption can have a significant impact on net zero projects. According to a report by the Royal United Services Institute, the transition to net zero risks being undermined by a lack of understanding of the risks of corruption in the renewable energy sector.⁵ The report states that the renewable energy sector is a “perfect breeding ground” for corruption, with billions of dollars invested in wind farms and solar projects globally. Projects often involve partnerships between the public and private sector, and the corruption risks are high given the role governments can play in the ownership or operation of utility companies, and the risks around procurement and licensing. Subsidies and grants are also magnets for corrupt individuals. Corruption risks undermining the energy transition in numerous ways. It hinders good business practices, making it more expensive to operate and reducing competition.

_{5. Clean Energy: Tackling Corruption in the Transition to Net Zero, Kathryn Westmore  (8 November 2022) < https://rusi.org/explore-our-research/publications/commentary/clean-energy-tackling-corruption-transition-net-zero>.}

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Article 42 of the Constitution enunciates the right to a clean and healthy environment. There are several ways where persons in breach of the environmental duty of care are held accountable. They may include:

• Civil Liability - attached to persons in breach of the environmental duty of care by damaging the natural resources, causing harm to public health through excessive greenhouse gas emissions or even ecological damage.

• Criminal Liability - may include imposition of fines, penalties as well imprisonment of persons. The directing mind of corporations (directors) may be held personally liable and may be imprisoned upon a company being found culpable.

• Statutory Regulations and Administrative Penalties - Part XIII of the Environmental Management and Coordination Act covering on environmental offences. This Part has prescribed a range of offences with their corresponding fines and penalties. The Act has outlined offences relating to violation of environmental standards, hazardous waste, materials, chemicals and radioactive substances, pollution, environmental restoration orders, orders of the Tribunal and conservation orders.

Polluter Pays Principle

Under section 142 of the EMCA the Court may direct that persons convicted of pollution pay the full cost of cleaning up the polluted environment and of removing the pollution or clean up the polluted environment and remove the effects of pollution to the satisfaction of the Authority.

The court may direct the polluter to meet the cost of the pollution to any third parties through adequate compensation, restoration or restitution.

Project operators under the Energy Act, Mining Act and Petroleum Act are obligated to comply with environmental laws. Under the Mining Act an applicant for a prospecting licence is required to provide an environmental protection bond which is sufficient to cover the costs of the environmental and rehabilitation obligations.

Under the Environmental Management and Coordination Act, the National Environmental Management Authority may issue a restoration order requiring a person to restore the environment as near as it may be to the state in which it was before the taking of the action which is the subject of the order.

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The Integrated National Land Use Guidelines

They provide for methods of preventing the contamination of land through ensuring compliance and enforcing licensing conditions. They provide for the maintenance of a Contaminated Land Register, which will be made accessible to the public. Furthermore, the Integrated National Land Use Guidelines empower NEMA and other relevant authorities to undertake site investigations of the contaminated land and evaluate the remedial reports filed by proponents. NEMA is further empowered to develop and approve site management plans to guide in the management of health and environmental harm.

The Environmental Management and Coordination Act, 1999

Section 93 prohibits the disposal of hazardous materials into the environment and makes such disposal an offence. A person convicted of this offence in addition to any other sentence is bound to pay the cost of removal of the hazardous material and the costs of third parties in the form of restoration, restitution and compensation. The owner of the source of the discharge is required to mitigate the impact of the discharge by informing the authorities, commencing immediate clean-up operations and complying with other rules issued by NEMA.

This act empowers NEMA to make regulations that provide for the labelling, classifying and handling of hazardous chemicals. It also prohibits and creates the offence of discharging chemicals into the environment contrary to the regulations enacted.

Section 11 of the Land Act, 2012

This section imposes an obligation on the National Land Commission to identify ecologically sensitive areas that are within public lands and demarcate or take any other justified action on those areas and act to prevent environmental degradation and climate change.

The National Sustainable Waste Management Policy, 2021

This policy seeks to provide an enabling regulatory environment for Kenya to effectively tackle the waste challenge by implementing sustainable waste management that prioritises waste minimisation and contributes to a circular economy. This has now been supported by the Sustainable Waste Management Act, CAP 387C of the laws of Kenya, which proposes the actual legal and institutional framework for sustainable waste management in Kenya.

The Draft Environment Management and Coordination (Toxic and Hazardous Industrial Chemicals and Materials Management) Regulations, 2018

The Draft Regulations will see Kenya aligning itself with the seventh edition of the Globally Harmonised System of classifying and labelling chemicals, which will be mandatory.

The Environmental Management and Co-ordination (Water Quality) Regulations, 2006

The regulations apply to water used for domestic, industrial, agricultural and any other purposes. The objective is to regulate the discharge of effluent and provide guidelines and standards for disposing of other pollutants.

The Environmental Management and Co-ordination (Air Quality) Regulations, 2014

The regulations provide for the prevention, control and abatement of air pollution for clean, healthy and ambient air. They prohibit certain forms of pollution and provide guidelines on levels of pollution that are permissible, as well as issuing emission licences. The Regulations apply to all internal combustion engines; all premises, places, processes, operations or works; and any other appliances or activities the cabinet secretary so designates. The Regulations prescribe areas deemed to be controlled and contain important provisions on limiting emissions from demolition, waste incinerators, open burning and cross-border pollution.

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In National Environment Management Authority & 3 others v. Maraba Lwatingu Residents Association & 505 others [2020] eKLR, the Environment and Land Court upheld the decision of the National Environment Tribunal cancelling an EIA licence for the construction of sewage ponds by Lake Victoria North Water Services Board and ordering restoration on the basis that the appellants did not conduct adequate public participation and that the mitigation measures under the Water Regulations were not adhered to.

In the case of Martin Osano Rabera & another v. Municipal Council of Nakuru & 2 others [2019] eKLR, the Environment and Land Court declared that the first respondent and NEMA (second respondent) had violated the petitioner's right to a healthy and clean environment regarding the way they had operated a dump site. Moreover, the third respondent was required to apply for a waste disposal licence under Sections 87, 88 and 89 of the EMCA.

In the case of KM & 9 Others v. Attorney General & 7 Others [2020] eKLR, the Environment and Land Court ordered the state and two private investors to pay USD $12 million to residents of an informal settlement in Mombasa who were affected by lead poisoning that emanated from a factory within the area. The state agencies responsible for the environment were also ordered to clean up any remaining lead deposits within four months or face further sanctions, and to develop and implement regulations adopted from best practices regarding lead and lead alloys manufacturing plants.

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The Constitution of Kenya at Articles 2(5) and (6) recognizes international law as part of the domestic legal order.

All domestic environmental laws must, therefore, be interpreted consistently with the principles of international laws and ratified International Environmental Law forms part of the law of Kenya. These include:

• The Convention on Biological Diversity

• African Convention on The Conservation of Natural Resources

• Vienna Convention for The Protection of The Ozone Layer

• Montreal Protocol on Substances That Deplete the Ozone Layer

• Ramsar Convention on Wetlands of International Importance Especially as Waterfowl Habitat

• International Convention for The Prevention of Pollution from Ships

• United Nations Law of The Sea

• The United Nations Framework Convention on Climate Change

The Kenyan Courts have upheld the doctrine of exhaustion of local remedies. The Civil Procedure Act directs litigants to approach the lowest court possible in the hierarchy when seeking to have their matter determined. With regards to international law, there is no law in Kenya that prohibits by-passing local courts and approaching an international dispute resolution body. This requirement would only stand where the international dispute resolution body requires the exhaustion of local remedies.

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Section 27 - Existing challenges and any potential near-term changes to the current legal framework in Kenya

a) Existing challenges

Incompatibility with development agenda. Projections of greenhouse gas emissions show that by 2030, energy will be the leading contributor due to the increased consumption of fossil fuels in meeting domestic, commercial, and industrial heating demands, as well as transportation. ⁶

Resource Constraints. The high initial investment cost of green energy and uncertainty of returns of certain efforts promoting climate change mitigation particularly renewable energy discourages investment and detracts from policy efforts.  

Inadequate Coordination of Institutions. Climate change policies are multi-sectoral and requires the Climate Change Directorate under the Ministry of Environment and Forestry to coordinate with various departments across agencies.

Enforcement of and gaps in legal framework. There are challenges found in the enforcement due to a lack of resources particularly funding and personnel, to effectively monitor and enforce them, which undermines Kenya's pathway to sustainability.

Illegalities. A challenge to Kenya’s existing legal framework is the issue of illegal activities like illegal poaching and illegal logging.

b) Potential near-term changes to the current legal framework in Kenya

The Natural Resources (Benefit Sharing) Bill, 2022

This Bill is intended to apply to natural resources including sunlight, water resources, wildlife resources, forests, biodiversity, and genetic resources among others. Before any natural resource is exploited in a county, the entity carrying out the exploitation will be required to enter a benefit sharing agreement with the relevant County Government. The Natural Resources Bill does not prescribe specific sharing ratios but proposes the establishment of a County Benefit Sharing Committee to make the determination. If this bill comes into force entities undertaking exploitation of natural resources will have two years to comply with the Act.  

The Environmental Management and Co-ordination Bill, 2022

This Act seeks to repeal and replace the Environmental Management and Co-ordination Act, 1999. The novelty of the Act is the establishment of the rights of nature. The Act acknowledges the right of nature to exist, persist, maintain, and regenerate its vital cycles, structure, functions and its processes in evolution and empowers any person to seek redress for violation of the rights of nature in the Environment and Land Court.

The Environmental Management and Co-ordination (Amendment) Bill, 2023

The principal object of the Bill is to amend Section 147 of the Environmental Management and Co-ordination Act, No. 8 of 1999 to permit the Cabinet Secretary to make regulations to prohibit the planting of eucalyptus trees along rivers, lakes, seas, and wetlands. This is meant to remove the water-intensive eucalyptus trees from water catchment areas and thus preserve ground water and prevent the reduction of water levels.

The Fisheries Management and Development Bill, 2023

This Bill provides for the conservation, management and development of fisheries and other aquatic resources with the aim of enhancing the livelihood of communities dependent on fishing. It also establishes the Kenya Fisheries Service as the regulatory body.

The Meteorological Bill, 2023

The principal object of the Bill is to put in place a legislative framework to regulate the meteorological services in Kenya and to co-ordinate and monitor meteorological services. The Bill proposes the establishment of the Kenya Meteorological Service Authority which shall be responsible for the provision, regulation, co-ordination and management of meteorological services.

The Forest Conservation and Management (Amendment) Bill, 2021

The principal object of this Bill is to streamline the procedure for petitioning Parliament under the Forest Conservation and Management Act, 2016. The Bill proposes amendments to section 34 of the Act to subject petitions seeking the variation of boundaries or revocation of public forests to the existing requirements under the Petition to Parliament (Procedure) Act, 2012 and the Standing Orders of the National Assembly.

_{6. Kenya's Updated Nationally Determined Contribution (NDC) < https://unfccc.int/sites/default/files/NDC/202206/Kenya%27s%20First%20%20NDC%20%28updated%20version%29.pdf>.}

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