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While Carbon (C) sequestration on farmlands may contribute to mitigate CO2 concentrations in the
atmosphere, greater agro-biodiversity may ensure longer term stability of C storage in fluctuating
environments. This study was conducted in the highlands of western Kenya, a region with high potential
for agroforestry, with the objectives of assessing current biodiversity and aboveground C stocks in
perennial vegetation growing on farmland, and estimating C sequestration potential in aboveground C
pools. Allometric models were developed to estimate aboveground biomass of trees and hedgerows, and
an inventory of perennial vegetation was conducted in 35 farms in Vihiga and Siaya districts. Values of the
Shannon index (H), used to evaluate biodiversity, ranged from 0.01 in woodlots through 0.4–0.6 in food
crop plots, to 1.3–1.6 in homegardens. Eucalyptus saligna was the most frequent tree species found as
individual trees (20%), in windrows (47%), and in woodlots (99%) in Vihiga and the most frequent in
woodlots (96%) in Siaya. Trees represented the most important C pool in aboveground biomass of
perennial plants growing on-farm, contributing to 81 and 55% of total aboveground farm C in Vihiga and
Siaya, respectively, followed by hedgerows (13 and 39%, respectively) and permanent crop stands (5 and
6%, respectively). Most of the tree C was located in woodlots in Vihiga (61%) and in individual trees
growing in or around food crop plots in Siaya (57%). The homegardens represented the second C pool in
importance, with 25 and 33% of C stocks in Vihiga and Siaya, respectively. Considering the mean total
aboveground C stocks observed, and taking the average farmsizes of Vihiga (0.6 ha) and Siaya (1.4 ha), an
average farm would store 6.5 0.1 Mg C farm 1 in Vihiga and 12.4 0.1 Mg C farm 1 in Siaya. At both sites,
the C sequestration potential in perennial aboveground biomass was estimated at ca. 16 Mg C ha 1. With the
current market price for carbon, the implementation of Clean Development Mechanism Afforestation/
Reforestation (CDM A/R) projects seems unfeasible, due to the large number of small farms (between 140 and
300) necessary to achieve a critical land area able to compensate the concomitant minimum transaction costs.
Higher financial compensation for C sequestration projects that encourage biodiversity would allow clearer
win–win scenarios for smallholder farmers. Thus, a better valuation of ecosystem services should encourage C
sequestration together with on-farm biodiversity when promoting CDM A/R projects.