July 15, 2024
Climate And Carbon Finance Market

The market for Climate And Carbon Finance anticipated to open up new avenues for climate change mitigation and adaptation efforts

The 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 29. % over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:

Climate and carbon finance involves facilitating investments that reduce greenhouse gas emissions or finance climate change adaptation projects. The market deals with carbon credits, offset programs, carbon trading platforms, and climate project development. The key products in the market include voluntary carbon credits, compliance carbon credits, and carbon removal credits. Voluntary carbon credits represent emission reductions from projects in sectors like forestry, renewable energy, and waste management.

Market Dynamics:

Two major drivers of the Climate And Carbon Finance Market are stringent government regulations around carbon emissions and growing focus on decarbonization targets among organizations. Stringent policies by governments worldwide to curb emissions and meet commitments under the Paris Agreement have increased demand for carbon offsetting and emissions trading schemes. Many countries have imposed carbon pricing through carbon taxes or emissions trading systems. Furthermore, companies across industries are pledging net-zero targets which is fueling investments in emission reduction projects and carbon credits. Secondly, technological advancements are enabling new solutions in areas like carbon capture, utilization and storage. New solutions make offsetting emissions more feasible and cost-effective thereby driving market growth.

Segment Analysis

The climate and carbon finance market can be segmented into compliance and voluntary type. The compliance segment currently dominates the market due to stringent regulations imposed by government and international environment protection organizations on limiting carbon emission from major polluting industries. Within compliance, the cap-and-trade sub-segment holds the largest share as it provides flexibility to companies in cost-effective reducing of emissions.

PEST Analysis

Political: Stringent environmental laws by governments worldwide to meet international emission reduction targets act as a driver. Economic: Carbon pricing strategies and market-based mechanisms for emission reduction provide monetary benefit. Social: Increasing awareness about climate change and its effects boosts the voluntary segment. Technological: Advancements in carbon accounting and trading platforms help establish transparency.

Key Takeaways

The global climate and carbon finance market is expected to witness high growth, exhibiting CAGR of 29.% over the forecast period, due to increasing regulatory pressure as well as voluntary commitments from major corporations to reduce carbon footprint. Regionally, Europe dominates currently due to the presence of mature cap-and-trade systems like EU-ETS and voluntary carbon markets in countries like UK. The North American region is also projected to grow at a considerable pace during the analysis period.

Key players operating in the climate and carbon finance market are Climate Finance Partners (United States), Carbon Credit Capital (United States), ClimateCare (United Kingdom), South Pole Group (Switzerland), Climate Trust Capital (United States), Carbon Clear (United Kingdom), EcoAct (France), First Climate (Germany), ClimatePartner (Germany), Ecosphere+ (United Kingdom), Verra (United States), Gold Standard (Switzerland), Natural Capital Partners (United Kingdom), Climate Friendly (Australia), Forest Carbon (United Kingdom).

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