Global Voluntary Carbon Credit Market Overview:
As per MRFR analysis, the Voluntary Carbon Credit Market Size was estimated at 0.98 (USD Billion) in 2022. The Voluntary Carbon Credit Market Industry is expected to grow from 1.45 (USD Billion) in 2023 to 50.0 (USD Billion) by 2032. The Voluntary Carbon Credit Market CAGR (growth rate) is expected to be around 48.22% during the forecast period (2024 - 2032).
Key Voluntary Carbon Credit Market Trends Highlighted
The Voluntary Carbon Credit Market is witnessing a remarkable increase, with motivations coming from rising corporate commitments to sustainability and government policies promoting decarbonization. Some of the key developments in recent times include an upsurge in the demand for high-quality carbon credits, particularly from nature-based solutions, as well as projects that contribute to sustainable development. The market is also experiencing new technologies like blockchain and artificial intelligence, which are improving transparency and efficiency in the trading of credits.
Opportunities for growth in the voluntary carbon credit market lie in expanding the types of projects that qualify for generating credits, like renewable energy and energy efficiency schemes. Additionally, standardized methodologies and certification frameworks will improve the credibility and comparability of carbon credits. Strategic alliances between market participants such as companies, project developers, and brokers can encourage innovation and increase the supply of good quality credits.
For example, stakeholders must meet challenges related to maintaining the environmental reliability of carbon offsets, preventing greenwashing, and encouraging unbiased participation in this marketplace. Government policies towards the development of a robust voluntary carbon credit market are very important. Through capitalizing on these trends while addressing emerging difficulties, there is potential for voluntary carbon credit markets to play a key role in meeting global climate targets while supporting sustainable development objectives.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Voluntary Carbon Credit Market Drivers
Increased Corporate Sustainability Commitments
Companies are becoming more aware of sustainability, and this leads to the establishment of ambitious goals to decrease the level of carbon emissions. More and more organizations are asking for voluntary carbon credit as they try to offset the production of greenhouse gases and achieve the determined goals in regard to sustainability. As a result, the Voluntary Carbon Credit Market Industry is going to develop.
Government Regulations and Policies
Government regulations and policies are also a factor driving the growth of the Voluntary Carbon Credit Market Industry. Many countries have put measures in place to impose a carbon price. Such measures could take the form of carbon taxes or cap-and-trade systems, among others. The result has been companies searching for ways of offsetting their carbon footprints by purchasing carbon credits.
Technological Advancements
Technological improvements also drive the development of the Industry. Developing new technologies like the ability to remotely check the amount of carbon produced or the usage of blockchain to make CO2 trading safer and more reliable also positively influences the growing appeal of the Voluntary Carbon Market Industry.
Voluntary Carbon Credit Market Segment Insights:
Voluntary Carbon Credit Market Credit Type Insights
Nature-based Solutions, Renewable Energy, Energy Efficiency, Industrial Processes, and Agriculture and Forestry are the five primary credit types in the Voluntary Carbon Credit Market. Nature-based solutions, which involve preserving and restoring natural ecosystems like forests and wetlands, are anticipated to account for the majority of the market by 2024. Nature-based solutions are predicted to account for more than half of the Voluntary Carbon Credit Market revenue in 2024, with an estimated value of $5 billion, due to their capacity to sequester carbon dioxide from the environment.
Renewable energy projects, which produce energy from renewable sources like solar and wind power, are anticipated to be the second-largest segment, with an expected market share of over 25% in 2024. The growing need for clean energy sources is driving the expansion of the renewable energy sector. Energy efficiency projects, which seek to minimize energy use in buildings and other constructions, are anticipated to expand at a significant rate and account for close to 15% of the market in 2024. The rising cost of energy and the necessity to cut greenhouse gas emissions are both contributing to the expansion of the energy efficiency sector.
Industrial process projects, which seek to minimize greenhouse gas emissions from industrial operations, are projected to account for between 5 and 10% of the market in 2024. As businesses look for ways to lessen their environmental impact, the sector is expanding quickly. The smallest sector, agriculture and forestry, is anticipated to account for around 5% of the Voluntary Carbon Credit Market in 2024. The growing need to cut emissions from agriculture and forestry operations is driving the growth of this sector.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Voluntary Carbon Credit Market Standard Insights
The Gold Standard, Verra, American Carbon Registry, Climate Action Reserve, and Green-e Climate are prominent standards in the Voluntary Carbon Credit Market. They provide a framework for project development and verification, ensuring the quality and credibility of carbon credits. The market for credits certified by these standards is expected to grow significantly in the coming years, driven by increasing demand from corporations seeking to offset their carbon emissions and contribute to climate change mitigation. In 2023, the global market for voluntary carbon credits certified by these standards was valued at approximately USD 2 billion and is projected to reach USD 50 billion by 2030, representing a CAGR of over 20%.
The growth of this market segment is supported by favorable government policies, technological advancements, and rising awareness about the importance of carbon offsetting.
Voluntary Carbon Credit Market Verification Level Insights
Third-party Verified, Self-Asserted, Auditing Standard, and industry standard are the four main types of verification levels in the voluntary carbon credit market. Third-party Verified credits are verified by an independent third party, which provides a higher level of assurance than Self-Asserted credits, which are verified by the project developer itself. Auditing Standard credits are verified against a specific auditing standard, such as the ISO 14064 standard, while Industry-Standard credits are verified against a specific industry standard, such as the Verified Carbon Standard (VCS) or the Gold Standard.
The Third-party Verified segment is expected to grow at the highest CAGR during the forecast period due to the increasing demand for high-quality credits from buyers who want to ensure the credibility of their carbon offsets. The Self-Asserted segment is expected to grow at a slower pace due to the increasing demand, although they are less expensive than Third-party Verified credits. The Auditing Standard segment is expected to grow at a steady pace due to the increasing adoption of auditing standards by project developers. The industry-standard segment is expected to grow at a moderate pace due to the increasing competition from other verification levels.
Voluntary Carbon Credit Market Project Location Insights
The Voluntary Carbon Credit Market is segmented by project location into Developed Countries, Developing Countries, Emerging Markets, Sub-Saharan Africa, Asia-Pacific, and Latin America. The Asia-Pacific region is expected to hold the largest share of the market in 2023, with a valuation of USD 0.65 billion. This is due to the increasing demand for carbon credits from countries such as China, India, and Japan. This growth is attributed to the increasing adoption of carbon pricing mechanisms and the growing awareness of the importance of climate change mitigation.
The Emerging Markets segment is also expected to witness significant growth, with a CAGR of 49.55% from 2024 to 2032, reaching a valuation of USD 13.41 billion by 2032. This growth is driven by the increasing economic growth and industrialization in these countries.
Voluntary Carbon Credit Market Project Size Insights
The Voluntary Carbon Credit Market is segmented by project size into small-scale projects, medium-scale projects, and large-scale projects. Small-scale projects generate up to 100,000 tonnes of carbon dioxide equivalent (CO2e) per year. These projects are typically community-based and focus on activities such as reforestation, renewable energy, and energy efficiency. In 2024, the small-scale project segment is expected to account for around 25% of the Voluntary Carbon Credit Market revenue. Medium-scale projects are those that generate between 100,000 and 1 million tonnes of CO2e per year.
These projects are typically larger than small-scale projects and may involve a wider range of activities, such as afforestation, methane capture, and REDD+. In 2024, the medium-scale project segment is expected to account for around 40% of the Voluntary Carbon Credit Market revenue. Large-scale projects generate more than 1 million tonnes of CO2e per year. These projects are typically very large and may involve activities such as renewable energy, carbon capture and storage, and industrial decarbonization. In 2024, the large-scale project segment is expected to account for around 35% of the Voluntary Carbon Credit Market revenue.
Overall, the Voluntary Carbon Credit Market is expected to grow rapidly in the coming years, driven by increasing demand for carbon credits from corporations and governments. The market is also expected to benefit from the development of new technologies and methodologies for carbon accounting and verification.
Voluntary Carbon Credit Market Regional Insights
The regional segmentation of the Voluntary Carbon Credit Market offers valuable insights into the diverse market dynamics across different geographical regions. North America currently dominates the market, accounting for a significant share of the Voluntary Carbon Credit Market revenue. The region's robust economic growth, coupled with stringent environmental regulations and a growing awareness of corporate social responsibility, has fueled the demand for voluntary carbon credits. Europe follows closely behind, driven by the European Union's ambitious climate goals and a strong focus on sustainability.
The APAC region is emerging as a promising market, with increasing demand from countries like China, India, and Japan. South America and MEA are expected to witness steady growth in the coming years as governments and businesses recognize the importance of carbon offsetting in mitigating climate change.
Source: Primary Research, Secondary Research, MRFR Database and Analyst Review
Voluntary Carbon Credit Market Key Players And Competitive Insights:
As the Voluntary Carbon Credit Market gains popularity, major players are slowly increasing their operations to cater to the growing demand. As firms widen their provisions, competing firms continue to innovate on the best means to reduce emissions. Additionally, the leading players in the Voluntary Carbon Credit Market invest heavily in research and development to develop new means to reduce emissions. Verra is a firm that plays in the voluntary carbon market, offering standards and verification to its clients. The company offers services that increase the quality and credibility of the carbon market. The other services that Verra offers include project design, registration, verification, and issuance of carbon credits.
As the investment in the Voluntary Carbon Credit Market increases, the competition becomes more intense. Innovative carbon markets foster the competition of existing firms and entrants. This makes markets create measures to stimulate innovations and maintain healthy competition. Gold Standard is another firm that plays in the Voluntary Carbon Credit Market. The firm offers project development, certification, and verification. Gold Standard also plays a role in climate policy, and the firm works with other stakeholders such as governments, businesses, and NGOs to advance climate change policies.
Key Companies in the Voluntary Carbon Credit Market Include:
- Gold Standard
- BCarbon
- Regen Network
- Nori
- Common Carbon
- Trace
- Flux
- ClimatePartner
- Plan Vivo
- AirCarbon Exchange
- Carbonfuture
- earth
- South Pole
- BeZero Carbon
- Verra
Voluntary Carbon Credit Market Industry Developments
Recent developments in the Voluntary Carbon Credit Market include the increasing demand for carbon credits by corporations seeking to offset their carbon footprint, driven by growing consumer and investor pressure for sustainability. The market is also seeing the emergence of new carbon credit registries and standards, as well as the development of innovative carbon capture and storage technologies. These factors are contributing to the rapid growth of the market, which is expected to reach a value of USD 50 billion by 2032, representing a CAGR of 48.22% from 2024 to 2032.
Voluntary Carbon Credit Market Segmentation Insights
Voluntary Carbon Credit Market Credit Type Outlook
- Nature-based Solutions
- Renewable Energy
- Energy Efficiency
- Industrial Processes
- Agriculture and Forestry
Voluntary Carbon Credit Market Standard Outlook
- Gold Standard
- Verra
- American Carbon Registry
- Climate Action Reserve
- Green-e Climate
Voluntary Carbon Credit Market Verification Level Outlook
- Third-party Verified
- Self-Asserted
- Auditing Standard
- Industry-Standard
Voluntary Carbon Credit Market Project Location Outlook
- Developed Countries
- Developing Countries
- Emerging Markets
- Sub-Saharan Africa
- Asia-Pacific
- Latin America
Voluntary Carbon Credit Market Project Size Outlook
- Small-scale Projects
- Medium-scale Projects
- Large-scale Projects
Voluntary Carbon Credit Market Regional Outlook
- North America
- Europe
- South America
- Asia Pacific
- Middle East and Africa
| Report Attribute/Metric |
Details |
| Market Size 2022 |
0.98 (USD Billion) |
| Market Size 2023 |
1.45 (USD Billion) |
| Market Size 2032 |
50.0 (USD Billion) |
| Compound Annual Growth Rate (CAGR) |
48.22% (2024 - 2032) |
| Report Coverage |
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends |
| Base Year |
2023 |
| Market Forecast Period |
2024 - 2032 |
| Historical Data |
2019 - 2023 |
| Market Forecast Units |
USD Billion |
| Key Companies Profiled |
Gold Standard, BCarbon, Regen Network, Nori, Common Carbon, Trace, Flux, ClimatePartner, Plan Vivo, AirCarbon Exchange, Carbonfuture, Puro.earth, South Pole, BeZero Carbon, Verra |
| Segments Covered |
Credit Type, Standard, Verification Level, Project Location, Project Size, Regional |
| Key Market Opportunities |
Growing Demand from Corporates Companies seeking to achieve net zero emissions Technological Advancements: Blockchain and AI enhancing transparency and efficiency Expanding Scope of Projects A Broader range of carbon credit projects, such as forestry and renewable energy Global Regulatory Push: The focus on carbon pricing and ETS schemes is increasing, driving demand. Increased Consumer Awareness and Growing recognition of carbon footprints and the importance of carbon offsets. |
| Key Market Dynamics |
Rising Corporate Sustainability Initiatives Increasing Demand from Multinationals Growing Awareness of Climate Change Technological Advancements in Carbon Capture Emergence of New Carbon Credit Standards |
| Countries Covered |
North America, Europe, APAC, South America, MEA |
Frequently Asked Questions (FAQ) :
The Voluntary Carbon Credit Market is projected to reach an overall valuation of USD 50.0 billion by 2032, exhibiting a CAGR of 48.22% from 2024 to 2032.
North America region is expected to dominate the Voluntary Carbon Credit Market, with a highest CAGR during the forecast period.
Voluntary carbon credits are primarily used to offset carbon emissions and enable organizations and individuals to achieve their climate goals. They are also utilized in sustainability initiatives, such as reducing deforestation and promoting renewable energy.
Key players in the Voluntary Carbon Credit Market include Verra, Gold Standard, American Carbon Registry, and the Climate Action Reserve. These organizations provide standards and verification services for carbon credits.
The Voluntary Carbon Credit Market faces challenges such as ensuring the credibility and transparency of credits, addressing issues of double counting, and scaling up the market to meet growing demand.
Organizations can leverage Voluntary Carbon Credits to demonstrate their commitment to sustainability, reduce their carbon footprint, and contribute to climate change mitigation efforts.
The Voluntary Carbon Credit Market is witnessing increasing demand from corporates, investors, and governments. Technological advancements, such as blockchain, are also playing a role in enhancing transparency and efficiency.
The Voluntary Carbon Credit Market is largely self-regulated, with organizations like the International Carbon Reduction and Offset Alliance (ICROA) providing guidance and standards. However, some jurisdictions may have specific regulations or policies related to carbon credits.
The Voluntary Carbon Credit Market is expected to continue its rapid growth in the coming years, driven by increasing awareness about climate change and the need for carbon offsetting. Technological innovation and policy support are also likely to contribute to market expansion.
Investors can participate in the Voluntary Carbon Credit Market through specialized funds, carbon credit exchanges, or by directly purchasing credits from project developers. Due diligence and careful evaluation are crucial to ensure the quality and credibility of credits.
