How large is the voluntary carbon credit market, and what is its growth trajectory?
The voluntary carbon credit market size has grown exponentially in recent years. It will grow from $1.55 billion in 2024 to $1.89 billion in 2025 at a compound annual growth rate (CAGR) of 21.9%. The growth in the historic period can be attributed to corporate social responsibility initiatives, early regulatory frameworks, international climate agreements, investor pressure on sustainability, and carbon pricing schemes.
The voluntary carbon credit market size is expected to see exponential growth in the next few years. It will grow to $4.13 billion in 2029 at a compound annual growth rate (CAGR) of 21.6%. The growth in the forecast period can be attributed to stringent carbon neutrality targets, mandatory climate disclosure regulations, growing consumer demand for green products, increasing corporate net-zero commitments, and inclusion of carbon credits in investment portfolios. Major trends in the forecast period include integration of carbon credits in supply chains, increasing participation of developing economies, premium pricing for high-quality carbon credits, partnerships with indigenous communities, and automated carbon offset verification tools.
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What are the key forces behind the voluntary carbon credit market’s growth in recent years?
The growing demand for clean energy is expected to propel the growth of the voluntary carbon credit market going forward. Clean energy is defined as energy obtained from sources with a minimum environmental impact and emitting little or no greenhouse gases. The demand for clean energy is due to environmental protection, public health benefits, energy security and independence, and regulatory and policy incentives. The rising demand for clean energy boosts investment in renewables, generating carbon credits by cutting emissions. These credits help businesses offset their footprint, strengthening the carbon market and promoting green energy growth. For instance, in March 2024, according to the Clean Power Annual Market Report published by the American Clean Power Association, a US-based organization, the clean energy industry installed 33.8 gigawatts (GW) of new utility-scale clean energy projects in 2022, marking a 12.5% increase over the previous record set in 2021. Therefore, the growing demand for clean energy is driving the growth of the voluntary carbon credit market.
What are the major segments of the voluntary carbon credit market?
The voluntary carbon credit market covered in this report is segmented –
1) By Type: Forestry, Renewable Energy, Waste Disposal, Other Types
2) By Project Type: Removal Or Sequestration Projects, Avoidance Or Reduction Projects
3) By Application: Industrial, Household Devices, Energy, Agriculture, Other Applications
4) By End Use: Government Agencies, Non-Governmental Organizations (NGOs), Private Companies, Individuals
Subsegments:
1) By Forestry: Afforestation, Reforestation, Avoided Deforestation, Forest Management
2) By Renewable Energy: Wind Energy Projects, Solar Energy Projects, Hydropower Projects, Biomass Energy Projects, Geothermal Energy Projects
3) By Waste Disposal: Methane Capture From Landfills, Waste-To-Energy Projects, Composting Projects, Recycling And Circular Economy Initiatives
4) By Other Types: Blue Coastal and Marine Ecosystem Restoration (Carbon), Soil Carbon Sequestration, Carbon Capture and Storage (CCS), Biochar Projects
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Which companies dominate the voluntary carbon credit market?
Major companies operating in the voluntary carbon credit market are Ambipar Group, Rubicon Carbon, South Pole, EKI Energy Services Ltd., The Carbon Trust, 3Degrees, Climate Impact Partners, Allcot Group, Green Mountain Energy, First Climate, ClimeCo LLC, Aera Group, Forliance, ComBio Energia, BioCarbon Partners, CarbonBetter, Atmosfair, NativeEnergy, NatureOffice GmbH, Carbon Credit Capital LLC, Finite Carbon, GreenTrees LLC, Puro.earth, Tasman Environmental Markets, TerraPass, CarbonClear, BURN
What major trends will shape the voluntary carbon credit market during the forecast period?
Major companies operating in the voluntary carbon credit market are focusing on developing advanced solutions such as digital carbon credit sourcing to streamline carbon credit access, supporting companies’ sustainability and emissions reduction efforts. Digital carbon credit sourcing refers to using online platforms and technologies to identify, purchase, and trade carbon credits, streamlining access to certified carbon offset projects. For instance, in September 2024, the ERM International Group Limited, a UK-based sustainability consultancy, launched the ERM Carbon Credit Portal designed to facilitate client access to the voluntary carbon market. This initiative aims to streamline the selection and purchasing process for carbon credits, enabling organizations to complement their greenhouse gas emissions reduction strategies effectively. The portal features pre-screened projects that allow users to evaluate climate benefits and associated risks, enhancing transparency and trust in the carbon credit procurement process. This launch is part of ERM’s broader strategy to support corporate decarbonization efforts.
What are the key regional dynamics of the voluntary carbon credit market, and which region leads in market share?
North America was the largest region in the voluntary carbon credit market in 2024. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the voluntary carbon credit market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa.
What Does The Voluntary Carbon Credit Market Report 2025 Offer?
The voluntary carbon credit market research report from The Business Research Company offers global market size, growth rate, regional shares, competitor analysis, detailed segments, trends, and opportunities.
A voluntary carbon credit is a tradable certificate that represents the reduction, removal, or avoidance of one metric ton of carbon dioxide (CO2) or its equivalent (CO2e) in greenhouse gases (GHGs). These credits are generated by projects that reduce emissions, such as reforestation, renewable energy, carbon capture, and energy efficiency initiatives. The voluntary carbon credits are bought and sold in the voluntary carbon market (VCM) by businesses, organizations, and individuals who aim to offset their carbon footprint beyond regulatory requirements.
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