Ghana is set for one of its most ambitious clean energy transitions yet as Standard Chartered Bank, in partnership with the World Bank, has closed a groundbreaking USD200 million Clean Cooking Outcome Bond.
The landmark deal is designed to unlock USD30.5 million to support the deployment of 415,000 cleaner cooking devices across the country between 2025 and 2028. With deadly household air pollution accounting for nearly 28,000 premature deaths every year in Ghana, the initiative marks a significant step toward safeguarding public health, protecting the environment, and reducing carbon emissions.
The USD200 million bond, issued by the International Bank for Reconstruction and Development, represents the first outcome bond with coupon returns directly linked to carbon credits generated under Article 6.2 of the Paris Agreement. This innovation sets a new benchmark in global climate finance by linking investor returns to measurable emissions reductions. The model is expected to attract more private capital into high-impact climate and social projects, particularly in developing regions like Africa.
The bond merges a fixed coupon with a variable return tied to the generation and sale of Internationally Transferred Mitigation Outcomes. These credits will be purchased by the KliK Foundation and used by Switzerland to meet its emissions reduction obligations under the Paris Agreement. The transaction demonstrates how carbon markets can achieve real-world impact while providing investors with a transparent and results-based return framework.
Unlocking Clean Cooking Access in Ghana
The financing will support UpEnergy, a leading carbon project developer in Africa, to distribute electric cookstoves and improved biomass cookstoves tailored to the needs of Ghanaian households. The devices are designed to replace fuel-intensive traditional cooking methods that rely heavily on solid biomass fuels such as wood and charcoal.
Approximately 75 per cent of Ghanaians, constituting about 26 million people, still depend on these fuels for daily cooking. This widespread reliance on biomass contributes to severe indoor air pollution, deforestation, and high household energy costs. With many low-income families unable to afford modern cooking appliances, the subsidies generated through carbon revenues will play a crucial role in making cleaner technologies accessible to the people who need them most.
The introduction of cleaner cookstoves is expected to deliver significant health benefits, especially for women and children who bear the greatest exposure to smoke from traditional cooking fires. By reducing household air pollution, the project aims to lower the alarming rate of respiratory illnesses that disproportionately affects vulnerable groups.
Beyond health improvements, the cookstoves will help reduce household expenses and decrease the time spent collecting firewood, a burden that often falls on women and young girls. This will contribute to improved quality of life, increased productivity, and enhanced safety for families in both rural and peri urban communities. Electrification and cleaner cooking technology also support broader national goals of energy efficiency and climate resilience.
A Strong Vote of Confidence from Global Investors
Standard Chartered served as the sole Lead Manager and Bookrunner for the transaction, using its extensive global network and expertise in carbon markets, capital markets, and structured finance to secure investors from four regions across its operational footprint. According to Henrik Raber, Global Head of Global Banking at Standard Chartered, the scale of the bond and its widespread investor participation highlight the growing demand for high integrity climate investments.
The World Bank also underscored the importance of the financing model in mobilising private capital for sustainable development. Jorge Familiar, World Bank Vice President and Treasurer, noted that the bond demonstrates strong investor appetite for impact driven investments. He added that linking returns to independently verified outcomes ensures accountability and directs capital where it can make the most meaningful difference.
Marisa Drew, Chief Sustainability Officer at Standard Chartered, emphasized that scaling private capital through Article 6.2 is essential for Africa and other developing regions. She explained that mechanisms like the Clean Cooking Outcome Bond transform climate ambitions into tangible investment opportunities that can build resilient communities and accelerate access to clean energy.
UpEnergy’s CEO, Mitch Sauers, praised the collaborative effort, describing the milestone as a breakthrough in bringing clean cooking solutions to scale. He highlighted the importance of innovative finance models and strong governmental cooperation in unlocking sustainable development across Africa.
As Ghana takes a major step toward a cleaner and more sustainable future, the project also sets a powerful global precedent for the integration of carbon markets into climate smart development.
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