الهيئة العامة للرقابة المالية

• The approval was granted during the tenth meeting of the Carbon Credit Regulatory Committee (CCRC), which was chaired by the Authority and included all relevant stakeholders.
• The registered projects are Abu Minqar Solar in the New Valley Governorate and soil organic carbon (SOC) in the Oases and Minya.
• The projects are being developed by Lotus for Agricultural Development and Investment, Value Network Venture and Mars for Selling and Distributing Energy.
• These decisions underscore the Authority’s dedication to accelerate the development of the Voluntary Carbon Market to achieve carbon neutrality goals.
• The committee also gave preliminary approval for the registration of the Spanish company (Applus) as accredited Validation/Verification Body (VVB).
• To date, 34 emission reduction projects have been registered in the Authority’s databases, with 170,000 carbon credits now available for trading on the voluntary carbon market.

The Financial Regulatory Authority (FRA) has approved the registration of four new projects through the CCRC which oversees carbon emission reduction units. This pivotal move officially adds these projects to the Authority’s database, clearing the way for the future issuance of tradable carbon credits after they undergo full verification and validation.

Among the new projects are  Abu Minqar Solar PV initiative in the New Valley Governorate and Soil Organic Enhancement for Climate Change Mitigation (SOC) projects located in the Oases and Minya Governorates. These are being developed by a consortium of companies: Lotus for Agricultural Investment, Value Network Venture, and Mars for Selling and Distributing Energy, the latter being a subsidiary of the renewable energy firm Karma Solar.

In a related decision, the Committee granted preliminary approval to the Spanish company Applus, allowing it to serve as a validation and verification body for these carbon reduction projects. The meeting brought together key representatives from  FRA,  Ministry of Environment and  Egyptian Exchange, along with several subject-matter experts.

Validation/Verification Bodies (VVBs) registered with the Authority are responsible for the comprehensive measurement, registration and documentation of environmental projects designed to reduce carbon emissions. To do this, they perform a rigorous evaluation of all project-related information, including the project’s objectives, the technologies used and the estimated emission reductions. These bodies then verify the accuracy of the data, which provides transparency and trust for investors, institutions and the general public.

This process ensures that all registered projects are legitimate and are achieving their stated goals. The number of registered Validation/Verification Bodies currently stands at six , including both local and foreign entities.

With the recent additions, the total number of voluntary carbon emission reduction projects registered in the Authority’s database has increased to 34. These projects have generated 170,000 carbon credits, all of which are available for trading on the designated carbon credits trading platform.

Carbon Credits Registries are defined as centralized electronic systems that include records for issuing, registering and tracking the transfer of ownership of carbon credits. These credits are generated from the implementation of carbon reduction projects in accordance with methodologies issued by Standard Programs.

Abu Minqar Solar PV projects reduce carbon emissions through agriculture and the generation of renewable energy. The Soil Organic Enhancement for Climate Change Mitigation (SOC) projects, on the other hand, reduce carbon emissions by sequestering carbon in the soil through agricultural activity.

The Committee also granted preliminary approval for the Spanish company Applus to be registered as an international Validation/Verification Bodies. This decision was made after a company representative provided a detailed presentation of their business model and the countries in which they operate.

This initiative comes in light of the Authority’s commitment to accelerate the activation of the Voluntary Carbon Market. The Authority pioneered the launch of the first organized Voluntary Carbon Market in Egypt and Africa, aiming to enable the implementers and financiers of carbon emission reduction projects – whether agricultural, industrial, or otherwise – to issue and sell carbon credits on designated trading platforms. This is intended to attract new categories of both local and international investors to purchase these carbon credits.

The Financial Regulatory Authority’s goal is to enhance Egypt’s  efforts toward achieving carbon neutrality and reducing emissions. This is a primary objective currently adopted by countries worldwide to ensure a habitable planet and mitigate the significant negative effects of rising global temperatures caused by carbon emissions which can lead to fires and floods that threaten business operations.

This initiative, in line with the announcements made at COP27, aims to empower the implementers and financiers of carbon emission reduction projects—whether they are agricultural, industrial, or other types of projects. By enabling them to issue and sell carbon credits on designated trading platforms, the Authority seeks to attract new categories of local and international investors. This will generate additional revenue for project implementers, increase investment rates in these projects, and ultimately help Egypt achieve a leadership position in this field and realize sustainable economic growth.

The foundation of the new market began with Prime Ministerial Decree No. 4664 of 2022. This decree amended the Capital Market Law (No. 95 of 1992) to officially classify carbon credits as a financial instrument. Based on a proposal from the Authority’s Board of Directors, the decree also mandated the Stock Exchange to create a trading platform and establish a regulatory committee. Following this, the Financial Regulatory Authority (FRA) formed the CCRC which oversees carbon emission reduction units. The Committee, chaired by FRA Chairman, includes representatives from  FRA, Ministry of Environment, Stock Exchange, and experts in carbon markets.

To accelerate the market’s activation, a crucial step for boosting Egypt’s carbon reduction efforts,  FRA continued its proactive approach. It issued a decree to regulate the criteria for listing Validation and Verification Bodies (VVBs). The new Committee began receiving applications from interested bodies, conducting interviews to verify their qualifications and capabilities. This process resulted in the listing of six local and foreign bodies to perform the necessary validation and verification tasks.

To complete the market’s framework, the Authority established comprehensive rules for the listing and delisting of carbon credits on Egyptian Stock Exchanges. It also set criteria for accrediting local voluntary carbon registries, which function as electronic central systems for issuing, registering and tracking the ownership transfer of these carbon credits. This was all done according to the methodologies of relevant standards-setting bodies. In parallel, following extensive consultation, the Authority approved the trading and settlement rules for voluntary carbon credits on the Egyptian Stock Exchange.