Global Carbon Credits Market on Track to Achieve $1.2 Trillion Valuation by 2029

BCC Research Study Projects 28.4% CAGR, Driving Market Growth from $267.8 Billion in 2023; Volume Expected to Reach 28 Gigatons with a 23.1% CAGR

BOSTON, July 29, 2024 /PRNewswire/ -- Discover the dynamic world of carbon credits, where businesses and individuals purchase offsets to neutralize their carbon emissions, fostering sustainability and aiding the fight against climate change.

According to the latest BCC research study, the demand for Carbon Credits Market: Global Outlook expected to grow from $267.8 billion in 2023 and will reach $1.2 trillion by the end of 2029 at a compound annual growth rate (CAGR) of 28.4% during the forecast period. By volume, the market is expected to reach 28 gigatons by growing at a CAGR of 23.1%.

The global carbon credit market is analyzed based on different types, end users, and regions. The report measures the market in terms of value (billions of dollars) and volume (gigatons). It includes competitive intelligence, ranking top companies by their carbon credit offerings. Market estimates are based on the revenue from carbon credit project developers. The report also offers an ESG (environmental, social, and governance) analysis of the industry, highlighting recent company activities in this area. Additionally, it details market dynamics, emerging technologies, and global developments in the industry.

Some Interesting Facts about Carbon Credits Market: Global Outlook

• Europe leads the carbon credit market, thanks to the EU ETS system launched in 2017, which many countries have adopted to combat greenhouse gas emissions. European industries prefer high-quality carbon credits, boosting revenue in the compliance market.
• Despite a decline in the voluntary carbon credits market, it remains a key driver of growth in the global carbon credits industry.
• UNCTAD reports that China, the U.S., and India are the top three CO₂ emitters, contributing over 50% of global emissions, with the top 20 countries accounting for 80%. Initiatives like the Kyoto Protocol, carbon pricing, emissions trading schemes (ETS), and carbon dioxide removals (CDR) are gaining momentum worldwide.
• In 2023, ETS and carbon taxes generated $104 billion in revenue, with ETS accounting for 70% and carbon taxes the remaining 30%.

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Factors contributing to this growth include:

1. Regulatory pressure to reduce carbon emissions.: means that governments are making rules and laws to force companies and individuals to emit less carbon dioxide (CO₂) and other greenhouse gases. This includes things like setting emission limits, taxing carbon emissions, and offering incentives for using cleaner technologies. The goal is to fight climate change by reducing the amount of harmful gases released into the air.
2. Increasing investments in eco-friendly technologies.: means more money is being spent on developing and using technologies that are good for the environment. This includes things like renewable energy (like solar and wind power), electric vehicles, and energy-efficient products. The goal is to reduce pollution and protect the planet.

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Report Synopsis        

Market Segmentation

The Global Market for Carbon Credits Market: Global Outlook can be categorized into various segments:

• End-User

These categories represent different sectors that use carbon credits and engage in efforts to reduce carbon emissions. "Energy" covers traditional and renewable energy producers, while "Power" refers to utilities generating electricity. "Transportation" includes vehicles and logistics, and "Building and Construction" encompasses real estate and infrastructure. "Other Industries" encompasses diverse sectors like manufacturing and agriculture. Each sector aims to mitigate its environmental impact by investing in carbon credit programs and adopting sustainable practices to combat climate change.

•  Type

These types categorize how carbon credits are traded and used globally. The "Compliance Market" involves businesses meeting mandatory emissions regulations by buying carbon credits, ensuring they adhere to legal limits. In contrast, the "Voluntary Market" allows organizations and individuals to purchase credits voluntarily to offset their emissions, demonstrating their commitment to sustainability beyond regulatory requirements. Both markets play crucial roles in incentivizing carbon reduction efforts across industries and promoting environmental stewardship on a broader scale.

•  Region

These regions represent geographical areas where carbon credit activities and regulations are implemented. "Asia-Pacific" covers countries like China and India, experiencing rapid industrial growth and emissions control efforts. "North America" includes the United States and Canada, with varied state and provincial carbon policies. "Europe" leads in carbon market innovation through initiatives like the EU ETS. "Rest of the World" encompasses regions like Africa and South America, each navigating unique environmental challenges and adopting diverse strategies to manage carbon emissions. Each region plays a crucial role in the global effort to mitigate climate change through carbon credit initiatives.

this report on global market for carbon credits market: global outlook provides comprehensive insights and analysis, addressing the following key questions:

1. What is the projected market size and growth rate of the market?
   
   The market is projected to grow from $267.8 billion in 2023 to $1.2 trillion in 2029 at a compound annual growth rate (CAGR) of 28.4% during the forecast period.  By volume, the market is expected to reach 28 gigatons by growing at a CAGR of 23.1%.
   
   
2. What are the key factors driving the growth of the market?
   
   Increasing demand for sustainable and low-emission fuels, increasing need to curb fast growing GHG emissions globally, and government support are key factors driving the market.
   
   
3. What segments are covered in the market?
   
   The segments covered in the market are end-user and type. The end-user segment includes power, energy, transportation, building and construction, and others. By type segmentation includes compliance markets and voluntary markets.
   
   
4. Which end-use segment will dominate the market by the end of 2028?
   
   The power industry segment will dominate the market by the end of 2028.
   
   
5. Which region will dominate the market by the end of 2028?
   
   The market has been classified into four regions, namely Asia-Pacific, North America, Europe, and Rest of the World. Rest of the World includes MEA, and South America. Europe holds the highest market share in the market followed by Asia-Pacific.

Some of the Key Market Players Are:

• 3DEGREES
• CLIMATEPARTNER GMBH
• CLIMATETRADE
• COOL EFFECT INC.
• EKI ENERGY SERVICES LTD.
• FINITE CARBON CORP.
• GREEN MOUNTAIN ENERGY CO.
• NATIVE
• TERRAPASS
• WGL HOLDINGS INC.

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