by The climate and carbon finance market involves financial trading schemes that put a price on greenhouse gas emissions or transactions related to emissions, with the aim of helping stabilize Earth’s climate. Products in this market include carbon credits earned from reducing or offsetting emissions that can be traded in voluntary or regulated markets.
The global climate and carbon finance market is estimated to be valued at US$ 459.58 Mn in 2023 and is expected to exhibit a CAGR of 5.9% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Governments and regulatory bodies globally have been increasingly implementing climate action plans and policies to meet their nationally determined climate goals under the Paris Agreement. For instance, the European Union has set a net zero emissions target by 2050 and aims to cut emissions by 55% from 1990 levels by 2030 through its Green Deal plan. This is driving significant growth in carbon pricing and trading schemes within its Emissions Trading System. Mandates to meet such ambitious climate targets have accelerated corporate adoption of internal carbon pricing and investments in high-quality voluntary offsets, boosting demand in the climate and carbon finance market.
Segment Analysis
The Global Carbon Finance Market Size is dominated by the compliance segment. This segment accounted for over 60% share of the total market in 2023 owing to stringent regulations mandating carbon emission reduction and cap-and-trade mechanisms across developed economies. The compliance segment is expected to witness further growth over the forecast period due to expanding carbon credit trading markets and the implementation of carbon pricing mechanisms in more countries and regions. The voluntary segment is the fastest growing segment and is expected to expand at around 7% CAGR between 2023-2030. This high growth is driven by growing carbon offsetting initiatives among corporates to achieve carbon neutrality targets and enhance their ESG credentials.
Key Takeaways
The global climate and carbon finance market is expected to witness high growth over the 2023-2030 period. Growth will be driven by stringent emission norms and policies promoting carbon trading markets globally.
Regional analysis: Europe dominated the global market with over 40% share in 2023 and is expected to continue leading owing to the maturity of its carbon market led by the EU Emissions Trading Scheme(EU ETS). The region has ambitious climate targets and a well-established regulatory framework for carbon trading and pricing.
Key players: Key players operating in the climate and carbon finance market are Archer Daniels Midland Company, Seagarden AS, Phermpep Co. Ltd., Arlak Biotech Pvt. Ltd., Naturade, Royal DSM, MYOS RENS Technology Inc., Natural Factors Inc., Valio Oy, GenScript, HELIX BIOMEDIX, Oryn Therapeutics, Selecta Biosciences, NIBEC, vivitide, PEPTIDE INSTITUTE, INC, BCN Peptides, Setlance srl., APEPTICO Forschung und Entwicklung GmbH, and BIONANOPLUS.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
