Carbon Credit

Carbon Credit

Global Carbon Credit Market to Reach US$3.9 Trillion by 2030

The global market for Carbon Credit estimated at US$465.1 Billion in the year 2023, is expected to reach US$3.9 Trillion by 2030, growing at a CAGR of 35.4% over the analysis period 2023-2030. Compliance Carbon Credit, one of the segments analyzed in the report, is expected to record a 35.7% CAGR and reach US$3.8 Trillion by the end of the analysis period. Growth in the Voluntary Carbon Credit segment is estimated at 21.6% CAGR over the analysis period.

The U.S. Market is Estimated at US$126.7 Billion While China is Forecast to Grow at 46.4% CAGR

The Carbon Credit market in the U.S. is estimated at US$126.7 Billion in the year 2023. China, the world`s second largest economy, is forecast to reach a projected market size of US$1.1 Trillion by the year 2030 trailing a CAGR of 46.4% over the analysis period 2023-2030. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at a CAGR of 27.9% and 31.4% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 29.4% CAGR.

Global Carbon Credit Market - Key Trends and Drivers Summarized

Carbon credits are a crucial tool in the fight against climate change, representing a market-based approach to controlling greenhouse gas emissions. A carbon credit is essentially a permit that allows the holder to emit a specified amount of carbon dioxide or other greenhouse gases. One credit permits the emission of one ton of carbon dioxide or the equivalent amount of different gases. These credits are part of international efforts such as the Kyoto Protocol and the Paris Agreement, designed to limit and reduce the levels of greenhouse gases in the atmosphere. Companies or countries that have reduced their emissions below their set limits can sell their excess credits to others who are struggling to meet their targets, thus providing a financial incentive for reducing emissions.

The carbon credit market operates on the principle of cap-and-trade systems, where a cap is set on the total amount of greenhouse gases that can be emitted. Entities that need to increase their emissions must buy credits from those who pollute less, creating a financial cost for emitting greenhouse gases and a reward for reducing emissions. This system not only promotes cleaner production methods but also encourages technological innovation and investment in renewable energy. The market includes both compliance markets, where credits are used to meet regulatory requirements, and voluntary markets, where businesses and individuals purchase credits to offset their carbon footprint as part of corporate social responsibility initiatives or personal commitment to environmental sustainability.

The growth in the carbon credit market is driven by several factors. Firstly, increasing regulatory pressures and the implementation of stricter emission reduction targets globally are compelling companies to engage in the carbon credit market to comply with regulations. Secondly, technological advancements in monitoring, reporting, and verifying emissions have improved the efficiency and transparency of carbon credit trading. Thirdly, the growing consumer demand for sustainable products and corporate transparency has led many companies to adopt carbon-neutral practices, which often involve purchasing carbon credits. Furthermore, the rise of environmental, social, and governance (ESG) investing has made carbon credits an attractive option for investors looking to fund sustainable ventures. Lastly, international cooperation and the establishment of more robust carbon markets are expected to facilitate greater trading volumes and market maturity, driving further growth. These factors collectively ensure that the carbon credit market continues to expand as a pivotal component of global efforts to mitigate climate change.

Select Competitors (Total 48 Featured) -

• 3Degrees
• Carbon Credit Capital, LLC
• Carbon EX Inc.
• CarbonBetter
• CarbonClear
• ClearSky Climate Solutions, LLC
• ClimeCo LLC
• Ecoact, Sas
• EKI Energy Services Ltd.
• Finite Carbon Corporation
• Green Mountain Energy Company
• MSCI Inc.
• PwC
• South Pole
• Sterling Planet
• Terrapass;

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