The West African Alliance Carbon Levies Simulator for Governments

Climate Focus has been a steering committee member and technical partner of the West African Alliance on Carbon Markets and Climate Finance since its inception.

As part of this work, we’re pleased to introduce the Carbon Market Levies Simulator: a practical tool developed to support governments in designing and assessing fees and levies within their carbon market frameworks.

How it works

The tool operates as a scenario-based simulation model. Policymakers enter key inputs (e.g., country selection, publication characteristics, credit volumes, prices, and policy parameters) in designated input cells. The calculation engine then estimates financial outcomes, including total government revenue and developer net revenue, showing results in a clear format.

The tool helps governments explore how different types of fees and levies (e.g., administrative fees, per-credit fees, revenue-based levies, in-kind deductions) could affect public revenue from carbon market activities, while also indicating how these measures may impact publication profitability and developer incentives.

Coverage and flexibility

The current version includes preset configurations and data for four pilot countries – Ghana, Kenya, Malaysia, and Zimbabwe – based on publicly available regulations and policy documents. Users can override these preset values to test other country contexts and policy scenarios.

The tool is intended as a decision-support and exploratory instrument and does not replace official legal or regulatory guidance. Country configurations are based on a review of publicly available documents; governments may wish to periodically review their fees in light of evolving market circumstances.

Development

The tool was developed by Climate Focus in consultation with West African Alliance Focal Points and with support from the International Climate Initiative (IKI), funded by the German Federal Ministry for the Environment, Climate Action, Nature Conservation, and Nuclear Safety (BMUKN). Future versions may expand country coverage and refine assumptions as additional data becomes available.

Access the tool

Download the tool from the West African Alliance’s website, here. A video tutorial is available on the West African Alliance’s YouTube page and below.