Economic growth and environmental protection are often presented as competing interests. Industrialization drives economic development, but it can also place significant pressure on the environment through the emission of greenhouse gases (GHGs), including carbon dioxide, methane and nitrous oxide, which contribute to global warming. One mechanism developed to encourage emissions reduction is the carbon market, which creates economic incentives for reducing or removing greenhouse gas emissions through the generation and trading of carbon credits.[1]
Carbon markets have become an increasingly important source of climate finance and present opportunities for Nigeria to attract investment in emissions reduction projects. However, the credibility of these markets depends on the reliability of the carbon credits being traded. Where credits are issued on the basis of inaccurate data or emissions reductions that cannot be substantiated, the integrity of the market is undermined. This can weaken investor confidence and allow companies to make misleading claims about their contribution to environmental sustainability, a practice commonly referred to as greenwashing.[2]
The National Council on Climate Change has underscored the importance of strengthening measurement, reporting and verification (MRV) systems to enhance the credibility of Nigeria’s carbon market, attract investment and prevent greenwashing.[3] This raises an important question: what measures are necessary to ensure that MRV systems effectively guarantee the reliability of carbon credits? This infers that beyond establishing technical procedures for measuring and verifying emissions reductions, attention must also be given to the legal and regulatory framework governing these processes. This article therefore examines the role of MRV protocols in strengthening carbon market integrity in Nigeria, with particular emphasis on regulatory oversight, accountability for unreliable carbon credits and the measures necessary to support a credible and transparent carbon market.
Carbon Market Integrity and MRV Protocols
A carbon market is a trading system that facilitates the generation, sale and purchase of carbon credits representing greenhouse gas emissions reductions or removals.[4] Its credibility depends on whether the credits traded represent genuine and measurable climate benefits. Reliable monitoring, reporting and verification (MRV) protocols are therefore essential to ensuring the integrity of carbon markets.
MRV involves measuring greenhouse gas emissions and removals, reporting the results, and independently verifying their accuracy.[5] However, its effectiveness depends on reliable data, sound methodologies, independent verification and effective regulatory oversight. Weak safeguards may result in carbon credits being issued for overstated or unsubstantiated emissions reductions, undermining investor confidence and creating opportunities for greenwashing. MRV must therefore be supported by clear legal obligations, effective regulatory oversight and enforceable consequences for non-compliance.[6]
The Pillars of High-Integrity MRV
A credible carbon credit must represent a genuine, additional and durable reduction or removal of one metric tonne of carbon dioxide equivalent (tCO₂e). Measurement, Reporting and Verification (MRV) systems must address five key risks:
- Additionality: A project must demonstrate that its emissions reductions or removals would not have occurred without the incentive provided by carbon-credit revenue. For example, protecting a forest that was never at risk of being cleared would not generate additional emissions reductions.
- Baselines: Baselines must be based on credible data and conservative assumptions about what would have happened without the project. An inflated baseline can exaggerate a project’s emissions reductions and lead to over-crediting.
- Leakage: MRV systems must account for emissions displaced beyond a project’s boundaries. If logging stops in one forest but moves to a neighbouring area, the overall emissions benefit may be negligible.
- Permanence: Carbon removals must be maintained over the period for which the credits are claimed. If a reforested area burns years later, its stored carbon may be released into the atmosphere. Buffer pools, which reserve credits to compensate for such reversals, can help manage this risk.
- Double Counting: The same emissions reduction or removal must not be credited or claimed more than once. This can occur when multiple projects or parties claim the same environmental benefit, or when a credit is issued, transferred or used in a way that results in duplicate claims. Reliable registries, transparent ownership records and clear accounting rules are essential to prevent this risk.
Operationalising Nigeria’s Carbon Market Framework Through MRV
Nigeria’s carbon market framework is anchored in the Climate Change Act 2021 and the Carbon Market Activation Policy.[7] These instruments provide an institutional and policy foundation for market development, but their effectiveness depends on whether carbon credits can be measured reliably, independently verified and properly tracked.
In October 2026, the National Council on Climate Change (NCCC) emphasised the need for robust MRV protocols and a time-bound roadmap for operationalising Nigeria’s carbon market. It also highlighted the need for a unified national carbon registry to track credits and prevent double counting.[8] These priorities reflect a wider concern: the market must be supported by systems capable of demonstrating that the credits issued correspond to verifiable climate benefits.
Three measures are particularly important:
First, Nigeria needs consistent standards for measuring emissions reductions and removals. These standards should address the selection of baselines, the application of approved methodologies and the determination of the number of credits a project can generate.
Second, verification must be independent and credible. The assessment of project data should be undertaken by competent verifiers operating under appropriate accreditation and conflict of interest requirements. This would help reduce the risk of inaccurate reporting and ensure that credit issuance is supported by reliable evidence.
Third, a national carbon registry is needed to maintain records of credits throughout their lifecycle, from issuance and transfer to retirement. Such a registry would help establish ownership, improve transparency and reduce the risk of duplicate issuance or claims.
These measures must also be supported by clear rules defining the responsibilities of project developers, verifiers, registry operators and other market participants. The framework should specify how inaccurate reporting and non-compliance will be addressed, including the circumstances in which credits may be suspended or cancelled and penalties imposed.
Legal Accountability for Unreliable Credits
Effective MRV requires clear rules on responsibility when a carbon credit is found to be defective. A regulatory framework should distinguish the obligations of the principal market participants and provide proportionate consequences for breaches.
- Project developers: Developers are responsible for the accuracy of the project data they submit. Where reporting is inaccurate or fraudulent, appropriate consequences may include correction of records, suspension or cancellation of credits, replacement obligations and financial penalties, subject to the applicable rules.
- Verifiers: Verifiers must assess project data independently and competently. Accreditation requirements, conflict-of-interest safeguards and disciplinary procedures are necessary. Negligent or compromised verification should attract appropriate sanctions, including suspension or withdrawal of accreditation where justified.
- Registry operators: Registry operators must maintain accurate records of credit issuance, ownership, transfers and retirement. Clear operational standards and accountability mechanisms are needed to address failures that permit duplicate issuance or unauthorised transactions.
- Traders and corporate buyers: Market participants should conduct appropriate due diligence before acquiring or using credits. Those who knowingly trade defective credits or make misleading environmental claims should face consequences under applicable contractual, regulatory or consumer-protection rules.
These responsibilities must be established through enforceable rules rather than general statements of good practice. The legal framework should identify the conduct that constitutes a breach, the authority responsible for enforcement and the remedies or sanctions available. This would provide greater certainty for investors while protecting the integrity of the market.
Nigeria can draw lessons from established voluntary carbon-crediting standards, including Verra and Gold Standard, particularly in relation to project methodologies, independent verification and credit tracking.[9] Article 6 of the Paris Agreement also provides relevant international accounting rules, including safeguards against double counting in the accounting of internationally transferred mitigation outcomes (ITMOs).[10]
However, these mechanisms serve different purposes. Voluntary standards establish requirements for projects participating in their respective programmes, while Article 6 governs cooperation between countries and related international accounting arrangements. Nigeria’s domestic framework must therefore determine which requirements apply to each category of carbon-market activity. Alignment with credible international standards can improve the acceptance of Nigerian credits, but it does not replace domestic regulation and enforcement.
Where existing legislation provides sufficient authority, the priority should be implementation and enforcement. Where it does not, targeted regulations or legislative amendments may be required to establish clear liability, sanctions and remedies. Progress will also depend on technical expertise, reliable data infrastructure and effective coordination among the institutions responsible for regulating the market.
Conclusion
The credibility of a carbon market rests on the ability to demonstrate that its credits represent genuine climate benefits. MRV provides the means to establish this by addressing additionality, baselines, leakage, permanence and double counting. When these risks are not adequately managed, carbon credits may be issued for benefits that are overstated or cannot be sustained. For Nigeria, strengthening MRV must therefore go hand in hand with legal accountability. Project developers, verifiers, registry operators and other market participants need clearly defined responsibilities, supported by appropriate regulatory oversight and enforceable consequences for non-compliance.
The Climate Change Act 2021 and the Carbon Market Activation Policy provide a starting point for developing Nigeria’s carbon market. The next step is to ensure that this foundation is supported by consistent MRV standards, independent verification, a reliable national registry and effective enforcement. Ultimately, the success of Nigeria’s carbon market will depend not simply on the number of credits it generates, but on whether those credits can withstand scrutiny and demonstrate measurable climate benefits. That is what will give investors confidence in the market and help ensure that the finance it attracts supports genuine emissions reductions and removals.
[1] United Nations Development Programme (UNDP), what Are Carbon Markets and Why Are They Important?’ (UNDP Climate Promise) https://climatepromise.undp.org/news-and-stories/what-are-carbon-markets-and-why-are-they-important accessed 16 October 2026.
[2]United Nations, ‘Greenwashing – The Deceptive Tactics behind Environmental Claims’ https://www.un.org/en/climatechange/science/climate-issues/greenwashing accessed 16 October 2026.
[3] Voice of Nigeria, ‘Nigeria Moves to Strengthen Carbon Market’ https://von.gov.ng/nigeria-moves-to-strengthen-carbon-market/ accessed 16 October 2026.
[4] n1
[5]Carbon Market Watch, ‘Monitoring, Reporting and Verification (MRV)’ https://carbonmarketwatch.org/glossary/monitoring-reporting-and-verification-mrv/ accessed 16 October 2026.
[6]International Carbon Action Partnership, ‘MRV and Enforcement’ https://icapcarbonaction.com/en/mrv-enforcement accessed 16 October 2026.
[7]Climate and Sustainable Development Network of Nigeria, Nigeria’s Carbon Market Framework https://csdevnet.org/wp-content/uploads/1-Nigerias-Carbon-Market-Framework_print-version_251031_031718.pdf accessed 16 October 2026.
[8] n3
[9]Verra, ‘Gold Standard and Verra Launch Tool to Support Article 6.2 Reporting’ https://verra.org/gold-standard-and-verra-launch-tool-to-support-article-6-2-reporting/ accessed 16 October 2026.
[10] Paris Agreement (adopted 12 December 2015, entered into force 4 November 2016) art 6(2).
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