Global Carbon Offset/Carbon Credit Trading Service Market by Type (Industrial, Household, Energy Industry, and Others), Application (REDD Carbon Offset, Renewable Energy, Landfill Methane Projects, and Others), and Region (North America, Latin America, Europe, Asia Pacific and Middle East & Africa) - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast 2020 – 2027
Market Outlook:
The global carbon offset/carbon credit trading service market size was valued at USD 210.8 Million in 2019 and is projected to reach USD 841.0 Million by 2027, expanding at a CAGR of over 19.9% during the forecast period 2020 - 2027. The market growth is attributed to the growing demand for selling and purchasing carbon credits for limiting greenhouse gas emissions.
A carbon offset is a calculable avoidance, sequestration, or lessening of carbon dioxide (CO2), and other Green House Gas (GHG) releases. Carbon offsets are defined as project-based as they normally comprise specific projects or events that decrease or evade appropriate emissions.
In investments in carbon-offset projects, individuals can fund GHG-reduction processes applied by individuals to decrease their carbon tax legal responsibility, which costs lesser than what could be accomplished through investment in a company's operations.
Carbon offset/carbon credits are marketplace structures for the reduction of greenhouse gases emission. The greenhouse gas emissions limits are set by governments or regulatory agencies. Some companies cannot achieve an immediate reduction in emissions economically.
Consequently, the companies can buy carbon credits to comply with the emission cap. Companies with carbon offsets (greenhouse gas (GHG) emissions reductions) are generally rewarded with additional carbon credits. The selling of credit surpluses can be used to subsidize potential pollution reduction programs.
The developing countries present in regions including Asia Pacific, Latin America, Africa, and others are undergoing rapid industrialization and simultaneously accounting for higher carbon emissions. With the emergence of new methods such as carbon offset/carbon credit trading services, the governments and other organizations operating across these regions are coming up with new rules and regulations to overcome environmental hazards and counter carbon emissions.
Carbon offset projects are evaluated and developed under particular standards and approaches that allow carbon credits to be supplied. Liability on the type of procedures used for the improvement of carbon credits can also be traded in voluntary markets of carbon credit. Offset projects can be classified rendering to either the technology engaged or type of GHG saving, or the specific practice selected to develop the project.
The four most corporate categories of offset projects are renewable energy, biological sequestration, energy efficiency, and reduction of non-CO2 GHG emissions. Carbon offset practice describes factors and procedures required for calculating emission reductions by a carbon offset project during its lifespan. Project developers can use prevailing methods or develop new ones.
Carbon offset practices have to be accepted by a regulatory body assigned to the management of a particular standard. This certifies that all carbon offset projects globally are established under the same practice.
The two types of credits are:
- Voluntary emissions reduction (VER): A carbon offset that is traded in the over-the-counter or voluntary market for credits.
- Certified emissions reduction (CER): Emission units (or credits) created through a regulatory framework to offset a project's emissions.
The key difference between the two is that, as opposed to the VER, there is a third-party certifying authority that regulates the CER.
Artificial Intelligence (AI) Impact on Carbon Offset/Carbon Credit Trading Service Market
Carbon offsets or credits are majorly used by companies to lower emissions, it is done by monitoring carbon footprints. Here Artificial Intelligence plays a crucial part as it helps in tracking these activities, predicting carbon emissions, and managing credits. By implementing Ai on carbon credit/credit offset-related operations, companies and organizations are able to track their investments and rely on the accuracy of data, which leads to an increase in investments in greenhouse gas reductions.
- For instance, in July 2023, Nvidia Corporation a tech company and a supplier of artificial intelligence (AI) hardware and software, revealed its new approach to carbon capture and storage (CCS) that engineers and scientists can use to accelerate carbon sequestration. It is a method to lower climate change by redirecting carbon deep underground.
Carbon Offset/Carbon Credit Trading Service Market Dynamics
Major Drivers
Growing number of tree plantations and emission avoidance from the atmosphere to remove carbon is expected to drive the market. Carbon credits help to remove carbon from the environment which in turn reduces the emission. Moreover, organizations and companies buy carbon credits to limit greenhouse gas (GHG) emissions which is further expected to boost the market.
- For instance, in July 2022, Aera Group, the largest originator and trader of African carbon credits, announced the signing of a carbon credits transaction with EDF Trading, a trader in the wholesale energy markets and part of EDF Group, a global leader in low-carbon energies.
Moreover, increasing demand for carbon credits is expected to drive the market. The supply of carbon credits is low owing to this companies are pre-purchasing to cover the emission limit, thus boosting the market in the forecast period.
Existing Restraints
Carbon offset projects have significant risks which can affect the environment as any carbon that is isolated, can be released back to the atmosphere which is expected to restrain the market. For instance, after the deforestation of trees such as palm oil and soy, there are potential risks they get government permission to use the land again for production activities.
Emerging Opportunities
Carbon credit investment as it provides exposure to investors with directly researching for companies is expected to create lucrative opportunities for the market. Carbon credits are easy to invest and companies gain profit as by investing in carbon credits, the companies further contribute to the emission-reduction strategy.
Segmental Outlook
Type Segment Analysis
On the basis of type, the carbon offset/carbon credit trading service market has been segmented into industrial, household, energy industry, and others. Industrial gases cause high amounts of global warming. The reduction of these gases is a very effective way to decrease greenhouse gases (GHG). Industrial gas offset projects are low-cost to conduct and produce large numbers of offsets; however, industries are reluctant to adopt the low-carbon economy.
Application Segment Analysis
In terms of application, the market has been divided into renewable energy, REDD carbon offset, landfill methane projects, and others. Reducing Emissions from Deforestation and Forest Degradation (REDD) is a concept that has been developed in the UN climate conferences as a way to reduce large-scale forest loss and allied CO2 emissions. Renewable Energy Certificates (RECs) and carbon offsets are both environmental supplies that can be used to address GHG emissions.
Regional Analysis
In terms of region, the global carbon offset/carbon credit trading service market has been fragmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. Europe constituted a significant share of the market in 2020 and dominates the global market, as the companies that emit greenhouse gases under the European Union Emission Trading Scheme (EU ETS) are compelled to reduce their greenhouse releases or purchase pollution allowances or carbon credits from the market.
The volatile carbon prices in Europe are increasing the demand for carbon credit trading services hence, the market in the region holds a major share during the forecast period. The global leading polluters such as the US and China are yet to establish compulsory policies to reduce emissions.
The market in Asia Pacific is projected to expand at a considerable CAGR during the forecast period. Growing population and infrastructure in the region are expected to drive the market during the forecast period. Nearly 60% of the world’s population is residing in Asia Pacific and the number of infrastructures and buildings is also increasing thus, resulting in huge climate change and carbon emissions.
Asia Pacific encounters nearly 4.3 billion population among which almost 2 billion live in urban areas which is expected to rise by the next few years. To ensure the healthy growth of the population, it is highly essential to mitigate emissions. Moreover, companies are undertaking various initiatives for carbon offsetting which is further contributing to the market in the region.
- For instance, in August 2022, Visa, a leader in digital payments, announced the launch of Visa Eco Benefits in Asia Pacific. Eco Benefits is a collection of sustainability-focused solutions that are expected to help Visa cardholders across the region to understand the environmental impact of their day-to-day payments. Users are able to calculate the carbon footprint generated by Visa transactions, and access options for carbon offsetting-or charitable donations from the bank's website or app.
Key Benefits for Industry Participants & Stakeholders
- In-depth analysis of the global carbon offset/carbon credit trading service market
- Historical, current, and projected market size in terms of value
- Potential & niche segments and regions exhibiting promising growth covered
- Industry drivers, restraints, and opportunities covered in the study
- Recent industry trends and developments
- Competitive landscape & strategies of key players
- A neutral perspective on global carbon offset/carbon credit trading service market performance
Video Summary for Carbon Offset/Carbon Credit Trading Service Market :
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Chapter 2 Assumptions and Acronyms Used
Chapter 3 Research Methodology
Chapter 4 Carbon offset/carbon credit trading service Market Overview
4.1 Introduction
4.1.1 Market Taxonomy
4.1.2 Market Definition
4.1.3 Macro-Economic Factors Impacting the Market Growth
4.2 Carbon offset/carbon credit trading service Market Dynamics
4.2.1 Market Drivers
4.2.2 Market Restraints
4.2.3 Market Opportunity
4.3 Carbon offset/carbon credit trading service Market - Supply Chain Analysis
4.3.1 List of Key Suppliers
4.3.2 List of Key Distributors
4.3.3 List of Key Consumers
4.4 Key Forces Shaping the Carbon offset/carbon credit trading service Market
4.4.1 Bargaining Power of Suppliers
4.4.2 Bargaining Power of Buyers
4.4.3 Threat of Substitution
4.4.4 Threat of New Entrants
4.4.5 Competitive Rivalry
4.5 Global Carbon offset/carbon credit trading service Market Size & Forecast, 2017-2027
4.5.1 Carbon offset/carbon credit trading service Market Size and Y-o-Y Growth
4.5.2 Carbon offset/carbon credit trading service Market Absolute $ Opportunity
4.6 Global Carbon offset/carbon credit trading service Market: Impact Of Key Regulations
4.7 Technology Outlook
Chapter 5 Global Carbon offset/carbon credit trading service Market Analysis and Forecast by Types
5.1 Introduction
5.1.1 Key Market Trends & Growth Opportunities by Types
5.1.2 Basis Point Share (BPS) Analysis by Types
5.1.3 Absolute $ Opportunity Assessment by Types
5.2 Carbon offset/carbon credit trading service Market Size Forecast by Types
5.2.1 Industrial
5.2.2 Household
5.2.3 Energy Industry
5.2.4 Others
5.3 Market Attractiveness Analysis by Types
Chapter 6 Global Carbon offset/carbon credit trading service Market Analysis and Forecast by Applications
6.1 Introduction
6.1.1 Key Market Trends & Growth Opportunities by Applications
6.1.2 Basis Point Share (BPS) Analysis by Applications
6.1.3 Absolute $ Opportunity Assessment by Applications
6.2 Carbon offset/carbon credit trading service Market Size Forecast by Applications
6.2.1 REDD Carbon Offset
6.2.2 Renewable Energy
6.2.3 Landfill Methane Projects
6.2.4 Others
6.3 Market Attractiveness Analysis by Applications
Chapter 7 Global Carbon offset/carbon credit trading service Market Analysis and Forecast by Region
7.1 Introduction
7.1.1 Key Market Trends & Growth Opportunities by Region
7.1.2 Basis Point Share (BPS) Analysis by Region
7.1.3 Absolute $ Opportunity Assessment by Region
7.2 Carbon offset/carbon credit trading service Market Size Forecast by Region
7.2.1 North America
7.2.2 Europe
7.2.3 Asia Pacific
7.2.4 Latin America
7.2.5 Middle East & Africa (MEA)
7.3 Market Attractiveness Analysis by Region
Chapter 8 Coronavirus Disease (COVID-19) Impact
8.1 Introduction
8.2 Current & Future Impact Analysis
8.3 Economic Impact Analysis
8.4 Government Policies
8.5 Investment Scenario
Chapter 9 North America Carbon offset/carbon credit trading service Analysis and Forecast
9.1 Introduction
9.2 North America Carbon offset/carbon credit trading service Market Size Forecast by Country
9.2.1 U.S.
9.2.2 Canada
9.3 Basis Point Share (BPS) Analysis by Country
9.4 Absolute $ Opportunity Assessment by Country
9.5 Market Attractiveness Analysis by Country
9.6 North America Carbon offset/carbon credit trading service Market Size Forecast by Types
9.6.1 Industrial
9.6.2 Household
9.6.3 Energy Industry
9.6.4 Others
9.7 Basis Point Share (BPS) Analysis by Types
9.8 Absolute $ Opportunity Assessment by Types
9.9 Market Attractiveness Analysis by Types
9.10 North America Carbon offset/carbon credit trading service Market Size Forecast by Applications
9.10.1 REDD Carbon Offset
9.10.2 Renewable Energy
9.10.3 Landfill Methane Projects
9.10.4 Others
9.11 Basis Point Share (BPS) Analysis by Applications
9.12 Absolute $ Opportunity Assessment by Applications
9.13 Market Attractiveness Analysis by Applications
Chapter 10 Europe Carbon offset/carbon credit trading service Analysis and Forecast
10.1 Introduction
10.2 Europe Carbon offset/carbon credit trading service Market Size Forecast by Country
10.2.1 Germany
10.2.2 France
10.2.3 Italy
10.2.4 U.K.
10.2.5 Spain
10.2.6 Russia
10.2.7 Rest of Europe
10.3 Basis Point Share (BPS) Analysis by Country
10.4 Absolute $ Opportunity Assessment by Country
10.5 Market Attractiveness Analysis by Country
10.6 Europe Carbon offset/carbon credit trading service Market Size Forecast by Types
10.6.1 Industrial
10.6.2 Household
10.6.3 Energy Industry
10.6.4 Others
10.7 Basis Point Share (BPS) Analysis by Types
10.8 Absolute $ Opportunity Assessment by Types
10.9 Market Attractiveness Analysis by Types
10.10 Europe Carbon offset/carbon credit trading service Market Size Forecast by Applications
10.10.1 REDD Carbon Offset
10.10.2 Renewable Energy
10.10.3 Landfill Methane Projects
10.10.4 Others
10.11 Basis Point Share (BPS) Analysis by Applications
10.12 Absolute $ Opportunity Assessment by Applications
10.13 Market Attractiveness Analysis by Applications
Chapter 11 Asia Pacific Carbon offset/carbon credit trading service Analysis and Forecast
11.1 Introduction
11.2 Asia Pacific Carbon offset/carbon credit trading service Market Size Forecast by Country
11.2.1 China
11.2.2 Japan
11.2.3 South Korea
11.2.4 India
11.2.5 Australia
11.2.6 South East Asia (SEA)
11.2.7 Rest of Asia Pacific (APAC)
11.3 Basis Point Share (BPS) Analysis by Country
11.4 Absolute $ Opportunity Assessment by Country
11.5 Market Attractiveness Analysis by Country
11.6 Asia Pacific Carbon offset/carbon credit trading service Market Size Forecast by Types
11.6.1 Industrial
11.6.2 Household
11.6.3 Energy Industry
11.6.4 Others
11.7 Basis Point Share (BPS) Analysis by Types
11.8 Absolute $ Opportunity Assessment by Types
11.9 Market Attractiveness Analysis by Types
11.10 Asia Pacific Carbon offset/carbon credit trading service Market Size Forecast by Applications
11.10.1 REDD Carbon Offset
11.10.2 Renewable Energy
11.10.3 Landfill Methane Projects
11.10.4 Others
11.11 Basis Point Share (BPS) Analysis by Applications
11.12 Absolute $ Opportunity Assessment by Applications
11.13 Market Attractiveness Analysis by Applications
Chapter 12 Latin America Carbon offset/carbon credit trading service Analysis and Forecast
12.1 Introduction
12.2 Latin America Carbon offset/carbon credit trading service Market Size Forecast by Country
12.2.1 Brazil
12.2.2 Mexico
12.2.3 Rest of Latin America (LATAM)
12.3 Basis Point Share (BPS) Analysis by Country
12.4 Absolute $ Opportunity Assessment by Country
12.5 Market Attractiveness Analysis by Country
12.6 Latin America Carbon offset/carbon credit trading service Market Size Forecast by Types
12.6.1 Industrial
12.6.2 Household
12.6.3 Energy Industry
12.6.4 Others
12.7 Basis Point Share (BPS) Analysis by Types
12.8 Absolute $ Opportunity Assessment by Types
12.9 Market Attractiveness Analysis by Types
12.10 Latin America Carbon offset/carbon credit trading service Market Size Forecast by Applications
12.10.1 REDD Carbon Offset
12.10.2 Renewable Energy
12.10.3 Landfill Methane Projects
12.10.4 Others
12.11 Basis Point Share (BPS) Analysis by Applications
12.12 Absolute $ Opportunity Assessment by Applications
12.13 Market Attractiveness Analysis by Applications
Chapter 13 Middle East & Africa (MEA) Carbon offset/carbon credit trading service Analysis and Forecast
13.1 Introduction
13.2 Middle East & Africa (MEA) Carbon offset/carbon credit trading service Market Size Forecast by Country
13.2.1 Saudi Arabia
13.2.2 South Africa
13.2.3 UAE
13.2.4 Rest of Middle East & Africa (MEA)
13.3 Basis Point Share (BPS) Analysis by Country
13.4 Absolute $ Opportunity Assessment by Country
13.5 Market Attractiveness Analysis by Country
13.6 Middle East & Africa (MEA) Carbon offset/carbon credit trading service Market Size Forecast by Types
13.6.1 Industrial
13.6.2 Household
13.6.3 Energy Industry
13.6.4 Others
13.7 Basis Point Share (BPS) Analysis by Types
13.8 Absolute $ Opportunity Assessment by Types
13.9 Market Attractiveness Analysis by Types
13.10 Middle East & Africa (MEA) Carbon offset/carbon credit trading service Market Size Forecast by Applications
13.10.1 REDD Carbon Offset
13.10.2 Renewable Energy
13.10.3 Landfill Methane Projects
13.10.4 Others
13.11 Basis Point Share (BPS) Analysis by Applications
13.12 Absolute $ Opportunity Assessment by Applications
13.13 Market Attractiveness Analysis by Applications
Chapter 14 Competition Landscape
14.1 Carbon offset/carbon credit trading service Market: Competitive Dashboard
14.2 Global Carbon offset/carbon credit trading service Market: Market Share Analysis, 2019
14.3 Company Profiles (Details – Overview, Financials, Developments, Strategy)
14.3.1 3Degrees
14.3.2 AERA GROUP SAS
14.3.3 Allcot Group
14.3.4 Bioassets
14.3.5 Biofílica
14.3.6 Carbon Credit Capital
14.3.7 CBEEX
14.3.8 EcoAct group
14.3.9 Forest Carbon
14.3.10 GreenTrees
14.3.11 Guangzhou Greenstone
14.3.12 Native Energy
14.3.13 Schneider Electric
14.3.14 South Pole Group
14.3.15 Terrapass
14.3.16 WayCarbon