Global Carbon Credit Market (Value, Volume) - Analysis By Market Type (Voluntary, Compliance), End User, By Region, By Country: Market Size, Insights, Competition, Covid-19 Impact and Forecast (2023-2028)
Executive Summary
The Global Carbon Credit market was valued at USD 760.28 Billion in 2021 and is expected to grow at a CAGR of 21.14% during the forecast period of 2023-2028. Demand for carbon credits is expected to increase drastically in the near future due to the growing number of corporate net-zero commitments. Purchasing carbon credits allows corporations to become carbon-neutral today while they continue to work to reduce their emissions.
Businesses can commit to more aggressive and earlier goals with the help of carbon credits. Credits give companies the option to offset their current emissions while also taking cost-effective steps to cut future emissions through asset turnover and the evolution of their business models. In the long run, credits are crucial for offsetting hard-to-abate emissions from items that don't offer options for low or zero emissions.
As more private companies seek to engage in the offset market, recent advances have been fuelled by a rise in voluntary demand for these credits. Since projects with societal benefits coupled with emissions reductions are perceived as more attractive to voluntary buyers, these corporations have been under pressure from shareholders and the general public to drive this in recent years.
The demand increase in the offsetting market is caused by a rising awareness of environmental challenges on a global level, catalyzed by COP26. More and more companies are recognizing the environmental and social value of offsetting projects and taking climate action by compensating for their carbon footprint.
The voluntary market segment is expected to grow tremendously in the upcoming years. Voluntary carbon credits, whilst historically transacted through bespoke bilateral agreements between buyer and seller, can increasingly be bought through specialized carbon credit exchanges and trading platforms. Given the growth of the voluntary carbon credit market, more established exchanges are looking to launch their own offerings.
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