Rubicon Carbon has entered into a long-term agreement to supply Microsoft with two million tonnes of carbon removal credits from a forestry project in Northern Uganda, marking the first transaction executed under a joint carbon removal framework established by the two companies.
The deal will run through 2035 and draws on trees planted on degraded farmland by tens of thousands of smallholder farmers, turning an initiative rooted in rural communities into a pipeline for one of the world’s largest corporate climate portfolios.
The credits will come from Kijani Forestry’s Smallholder Farmer Forestry Project, a programme that has spent the past decade building a network of farmers in Northern Uganda who plant fast-growing tree species on underused and degraded land.
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The project is among the first approved under Uganda’s new Climate Change Mechanisms Regulations, a legal framework that aims to establish credibility and oversight in a global carbon market that has often been clouded by doubts about environmental integrity.
The agreement sits within a wider structure allowing Microsoft to purchase up to 18 million tonnes of carbon removal credits from Rubicon-supported projects. For Microsoft, which has pledged to become carbon negative by 2030, securing reliable removal credits in the Global South has become a central part of its strategy.
For Rubicon, headquartered in California, the deal demonstrates that nature-based carbon removal initiatives can attract long-term buyers if they deliver clear environmental benefits alongside measurable social outcomes.
Kijani Forestry’s footprint in Northern Uganda reaches far beyond carbon markets. The enterprise employs more than 600 people full time and works with roughly 50,000 farmers, many of whom depend on subsistence livestock and variable rainfall. By planting and managing private woodlots, farmers earn an initial income from carbon finance as saplings grow and then unlock additional revenue a decade later when trees reach harvest maturity.
Uganda’s government estimates that roughly 80 percent of rural households rely on firewood or charcoal; commercial woodlots therefore serve two purposes, easing pressure on natural forests while offering communities a legal source of timber and energy.
The promise of household income has been one of Kijani’s core selling points. The company estimates that families planting a single acre of trees can raise annual income severalfold when future carbon revenue and wood sales are combined. To date, farmers participating in the project have planted more than 30 million trees.
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While early growth phases yield only modest carbon storage, volumes increase significantly as trees mature, allowing credits to be issued and sold. Rubicon Carbon’s offtake agreement guarantees demand for a portion of those credits, reducing risk for farmers who have historically lacked access to formal carbon buyers or pre-financing.
Uganda’s forestry challenge is well documented. The National Forestry Authority estimates the country has lost more than half its forest cover over the past 30 years, largely due to agricultural expansion and charcoal production. Northern Uganda in particular emerged from two decades of conflict with land that was underused, degraded, and sparsely served by agricultural extension services. The carbon market now offers a rare opportunity to monetise restoration efforts that otherwise would not attract finance.
Uganda is not alone; across East Africa, governments are attempting to align rural development with nature restoration to meet climate targets without constraining communities that lack alternative livelihoods. Kenyan projects in Baringo and Kwale are experimenting with invasive species removal tied to restoration credits, while in Rwanda, smallholder agroforestry programmes supported by foreign investors aim to supply local wood industries while absorbing emissions. However, credibility and quality assurance remain persistent concerns, as poorly managed projects risk undermining trust across the entire sector.
Microsoft’s participation signals an appetite among corporate buyers to work more directly with project developers rather than relying solely on secondary trading platforms. Phillip Goodman, who leads carbon removal at the company, described the framework with Rubicon as a way to streamline contracting and create bankable revenue certainty for project developers. For Kijani, that stability is crucial; without predictable cash flow, expanding to new districts or training additional farmers becomes difficult.
Financing continues to be the limiting factor for most nature-based climate initiatives across Africa. The African Development Bank estimates that the continent faces a USD 200 billion annual climate financing need, yet current flows sit far below that level. Carbon markets are not a replacement for grants or concessional loans, but deals like this one suggest they can fill targeted gaps when well regulated and tied to measurable community benefits.
Uganda’s Ministry of Water and Environment, which oversees national restoration strategies, has described the Kijani project as an example of how national policy and private capital can reinforce each other. If the model continues to scale and retains credibility, it could provide a blueprint for community-driven carbon removal programmes across the region.
Whether similar structures emerge in Tanzania, Malawi, or the Democratic Republic of Congo, where land availability and poverty rates mirror Uganda’s, will depend on whether investors see real, verifiable credit streams emerge from the first generation of projects.
In the decade ahead, the partnership between Rubicon Carbon, Microsoft, and tens of thousands of Ugandan farmers will test whether voluntary carbon markets can support land restoration at a scale meaningful to Africa’s climate goals.
If the credits deliver the promised impact, the deal may come to be seen not only as a commercial transaction, but as a turning point in how global technology companies engage with rural communities on the frontlines of climate change.
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