Polluting cooking practices are an overlooked contributor to carbon emissions. Cooking with non-renewable fuels, including coal and biomass, on open fires or rudimentary stoves amounts to one billion tons of carbon dioxide per year. This represents about 2% of global CO2 emissions. To put this in perspective, that’s comparable to emissions from the entire global aviation industry. 

These cooking methods have a range of adverse impacts on local communities. Households without access to clean cooking technology can spend on average two hours per day collecting fuel, and another three on cooking due to an extended preparation process. This burden typically falls on women, limiting their opportunities to pursue other more financially rewarding activities, accounting for a total opportunity cost of $800 billion per year globally. Moreover, there are substantial health impacts. The associated household air pollution leads to around 3.7 million deaths annually, with women and children constituting 60% of these casualties. This makes it the third-largest cause of death amongst women and children globally.

While clean cookstoves present an important untapped market for carbon projects - and provide substantial benefits for local communities - there has not been a lot of work done on quantifying the market and estimating the size of the carbon market potential in clean cookstove projects.

Our approach to quantifying the market

We believe quantifying the market potential for clean cookstoves could help kickstart this conversation and bring more attention to this sector which is often overlooked. The current trajectory suggests that almost 2 billion people will still have no access to clean cooking by 2030, most of which are in Sub-Saharan Africa and Asia. If carbon credits could be fully utilized to support universal access to clean cooking, the carbon revenue potential could range from 2.7 to 8.0 billion USD by 2030.

Exhibit 1: Clean cookstove carbon credit potential could range from 2.7 to 8 billion USD by 2030.

On a high level, we calculate the addressable market as follows:

1. There are approximately 2.4 billion people without access to clean cookstoves across Sub-Saharan Africa, Asia, and Latin America, according to the International Energy Agency. By 2030, this is projected to reduce to 1.96 billion, as some countries (such as China and Indonesia) are expected to be on track to achieve universal clean cooking access by then.

2. Based on average household sizes, this translates to around 350 million households without clean cooking access by 2030.

3. Assuming each of these households will require one clean cookstove for their daily cooking needs, this represents an average of a 3-ton reduction in CO2 emissions per year per stove, as compared to the baseline emission of burning non-renewable fuels like wood or charcoal.  

4. Given that some households might be able to access clean cooking technology without the aid of carbon credits, we assume that only around half of the clean cookstoves distributed would be eligible for carbon credits – a conservative estimate to ensure the additionality of the projected carbon projects in our calculations.

This results in a total addressable reduction in CO2 emissions from carbon projects of around 530 million tons in 2030. Currently, clean cookstove credits are transacted at around $5 per credit on average but could be priced at around $15 per credit for high-quality projects that display tangible co-benefits and robust traceability. This corresponds to total addressable revenues of $2.7 to $8.0 billion for carbon credits in 2030.

Exhibit 2: Overview of how NetaCarbon calculates the carbon market size of clean cookstoves.

What this means to clean cookstove projectsIf this market potential is fulfilled, clean cookstove projects would represent 5-10% of the total projected carbon market in 2030. This means a future where carbon credits play a direct role in enabling universal clean cooking access - an explicit target under Sustainable Development Goal 7 (SDG 7) - and reducing global CO2 emissions from burning wood or charcoal.These carbon projects could be a “game changer” for the clean cookstoves market, offering an additional source of revenue to scale the much-needed household device in hard-to-serve markets.

The growth trajectory has been astonishing with a 21-fold increase in carbon finance volumes since 2019, eclipsing 5% growth in supply for commercial capital and contraction in traditional public funding. Volume growth for stoves driven by financing will lower cost curves for the end-user, aligning prices with the realities of affordability on the ground. Furthermore, demands for high-quality carbon credits could spur investments to improve the quality of clean cooking technologies and increase accountability, testing, and verification for the effectiveness of these projects. 

Recognizing this market potential, NetaCarbon is actively prioritizing and supporting clean cookstove companies to navigate the carbon credit issuance process. We are attracted to this market not only because of its untapped carbon market potential, but also its significance in improving health outcomes and livelihoods of communities, especially women and children. NetaCarbon is in discussion with prominent cookstove players to develop pilot projects using our platform to reduce the time and costs required to issue carbon credits, achieving our vision of democratizing access to the carbon market.If you are a clean cookstove company looking to scale your climate and social impact through carbon credits, please let us know - we would love to explore ways to support you. Stay tuned for further updates!

We would like to thank Mônica Bourroul Gonsalves for her contribution to this research paper and Rehan Mirza for editorial support. For this analysis, we drew upon data from the World Bank, International Energy Agency, World Health Organization, Berkeley Carbon Trading Project, and the Africa Carbon Markets Initiative.