Carbon credits are permits that allow companies and governments to emit a certain amount of greenhouse gases, especially carbon dioxide. Carbon credits can be traded in carbon markets and are issued by regulatory authorities including national governments. Carbon credits play an important role in mitigating climate change by providing incentives for industries and other entities to reduce their greenhouse gas emissions. They have applications in sectors such as transportation, buildings, aviation and more. The growing concerns regarding the environmental impact of emissions have accelerated the demand for carbon credits in recent years.
The global Carbon Credit Market is estimated to be valued at US$ 36.34 Mn in 2024 and is expected to exhibit a CAGR of 3.0% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Expansion of existing carbon markets as well as emergence of new carbon markets across the world is one of the key trends driving the growth of the carbon credit market. Regional carbon trading programs are being established at a rapid pace in line with the climate commitments taken by national governments and the Paris Agreement goals. In addition, voluntary carbon markets are evolving with participation from multinational corporations and other private entities focusing on achieving net-zero emissions targets. Large emitters are actively sourcing carbon offsets to balance out their residual emissions, thereby generating significant demand for credits. Rapid technological advancements are also enabling more accurate and transparent accounting of greenhouse gas emissions, which is supporting further mainstreaming of carbon credit mechanisms globally.
Segment Analysis
The global carbon credit market is dominated by compliance segment. Compliance segment accounts for over 60% share of the total market. It involves emissions trading programs implemented by governments to regulate carbon emissions from power plants, factories and other large industrial units. The compliance segment is expected to remain the major revenue generating segment over the forecast period due to stringent regulations worldwide to cut down carbon emissions and control environmental pollution.
Key Takeaways
The Global Carbon Credit Market Size is expected to witness high growth between 2024 to 2031. The global Carbon Credit Market is estimated to be valued at US$ 36.34 Mn in 2024 and is expected to exhibit a CAGR of 3.0% over the forecast period 2024 to 2031.
Regional analysis related content comprises- The European carbon credit market currently accounts for over 40% share of the global market. The region was one of the early adopters of emissions trading programs to curb carbon emissions. However, the Asia Pacific carbon credit market is forecast to register fastest growth during the forecast period. The region is witnessing rapid industrialization which is increasing its carbon footprint. Additionally, governments in countries like China and India are implementing carbon trading platforms to reduce environmental pollution.
Key players related content comprises- Key players operating in the Carbon Credit Market are ASLAN Pharmaceuticals, Takeda Pharmaceutical Company Limited, CHIESI Farmaceutici S.p.A., CSL, NIOX, Fountain Therapeutics, Eli Lilly and Company, GSK plc., Infinity Pharmaceuticals, Inc., Mabtech, Kineta Inc., Marinomed Biotech AG, Mycenax Biotech Inc., AstraZeneca, and Panacea Biotec.
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