India, March 9 -- The recent abrupt collapse and closure of KOKO Networks in Kenya for failure to meet new tougher regulatory hurdles sent profound shockwaves through the carbon credit and clean-tech sectors.

The shutdown of KOKO Networks, a popular climate- and venture-backed technology company and bioethanol fuel provider operating in East Africa and India, not only exposed the extreme vulnerability of carbon-financed projects to policy changes but also malpractices by major players in the market.

KOKO Networks closed shop after being in operation for 11 years in Kenya, after it was denied a required Letter of Authorization from the Kenyan government, primarily due to a dispute over the volume of carbon credits the company intended to...