Kennedy will be stepping down on 13 June to take up a senior role at the Department for International Development.
He will be handing over to chief economist Adrian Gault, who will act as interim chief executive until a new chief executive is appointment.
Kennedy has been the chief executive of the CCC since it was set up in 2008.
After announcing his departure, he said: “After seven wonderful years setting up and establishing the CCC, it is time for me to take up a new challenge.
“I am very proud of what we have achieved together, including setting economically sensible carbon budgets in legislation and most notably catalysing the Electricity Market Reform.
“I have greatly enjoyed and benefitted from working with a highly talented and dedicated team in the Secretariat and Committee, including Lord Turner, Lord Deben and Lord Krebs and the Committee members.
“I believe with this team and our wide network of stakeholders, the CCC is in a very strong position to continue providing advice based on evidence and analysis to the government and parliament.”
Lord Deben, chairman of the CCC, added: “David Kennedy created the team at the CCC, he established its reputation for scientific rigour and accuracy, and he has maintained that reputation throughout his seven years of service.
“He is the best kind of civil servant; intellectually robust and technically proficient, bringing sound judgment and careful evaluation to every issue.
“We owe him a great debt for a job well done.”