June 25, 2024
Global Carbon Credit Market

The global Carbon Credit Market is estimated to Propelled by growing focus on lowering carbon footprint

Carbon credits represents amounts of carbon dioxide-equivalent (CO2e) emissions that are reduced, avoided, or sequestered through approved carbon offset projects and activities. These credits can be traded in carbon markets to meet emissions reduction targets set by regulatory schemes like emissions trading systems. With rising concerns over climate change, there is growing focus among nations and organizations on reducing their carbon footprint and transitioning to more eco-friendly alternatives, thus driving demand for carbon credits.

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 2024-2031, as highlighted in a new report published by Coherent Market Insights.

Market key trends:
Growing focus on lowering carbon footprint through offsetting emissions is a major trend bolstering growth of the carbon credit market. Countries and organizations are strengthening their commitments to curb emissions under international agreements like the Paris Accord. This is driving up demand for verified carbon credits that allow buyers to offset their emissions footprint through investments in accredited emission reduction projects. Various industries are also increasingly procuring carbon credits for meeting voluntary emissions targets and reducing exposure to potential carbon pricing regulations. Initiatives promoting the use of carbon credits are further expected to support market gains over the forecast period.

SWOT Analysis
Strength: The global carbon credit market is backed by stringent government regulations and policies to reduce carbon emissions. This drives large scale adoption of carbon credits by organizations.
Weakness: Lack of standardized protocols and frameworks for measurement and verification of carbon reductions. This leads to uncertainty in the actual carbon credits being traded.
Opportunity: Growing focus on sustainability and net zero emissions targets open up new opportunities for carbon offsetting projects across sectors. Emerging markets also present scope for carbon credits generation.
Threats: Economic or political instability in countries generating carbon credits poses risk to the supply. Technological innovations in clean technologies could reduce the need for carbon offsets over the long term.

Key Takeaways
The Global Carbon Credit Market Size is expected to witness high growth over the forecast period due to stringent policies promoting reduction in greenhouse gas emissions. The market size is projected to reach US$ 36.34 Mn in 2024 and then grow at a CAGR of 3.0% to reach US$ 41.04 Mn by 2031.

Regional analysis
Europe dominates the global carbon credit market currently due to well established carbon trading programs in the region. Countries such as Germany, France and UK generate a major share of credits traded. Asia Pacific market is expected to witness fastest growth on back of rapidly expanding carbon markets in China and initiatives like REDD+ in developing countries.

Key players
Key players operating in the global 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. Major players are focused on scaling up carbon offset projects across sectors to strengthen their supply portfolio. Partnerships with governments and local communities boost project outreach.

1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it