The global carbon credit trading platform market is projected to generate USD 479 million revenue by 2030, advancing at a CAGR of 21.20% during 2022–2030. This is due the escalating count of markets permitting the partial usage of carbon credits, increasing investments in carbon capture systems, and surging adoption of renewable energy sources.
Moreover, several energy strategies employ scenarios that largely involve the adoption of renewable energy sources and investments in energy-saving technologies to cut global CO2 emissions by up to 50% between 2005 and 2050. Furthermore, fossil fuels are still heavily used (78.2%) worldwide despite increased investments in the development of renewable energy. Therefore, it becomes essential to explore for energy-saving techniques in addition to fundamentally altering the way energy is produced. About one-third of total investment is efficiency-related, as per the Global Energy Assessment's (GEA) efficiency pathways.
The environmental commitment that started in 2014 has evolved into business investments. While some refer to it as the "Greta Thunberg effect", 2019 saw a record 40% growth in corporate purchases of renewable energy worldwide.
The cap and trade category held the larger share in 2022. The cap-and-trade system establishes a market value for emissions. Moreover, industries now have a new economic resource because businesses that own emissions credits can sell them for a profit. A cap-and-trade policy offers an incentive for firms to invest in cleaner know-how rather than acquiring permits, which will get more expensive every year. Additionally, it encourages businesses to support research into alternate energy sources. Since companies that reduce their emission levels more quickly are in some way rewarded and can then sell their allowance to other companies, this procedure may result in faster reductions in pollution.
The cap-and-trade is also a means of generating cash for the government because it gives the option to decide whether to sell emissions credits to the highest bidder at auction. This additional income might be used to fund social initiatives, infrastructure improvements, investments in greener technologies, or even help close a state or federal budget gap.
Moreover, the baseline credit system also held a significant position in the market. Such systems with baselines and credits establish an upper limit on carbon emissions and issue carbon credits when emissions are decreased below that limit. Furthermore, using tradable allowances known as carbon credits, certificates, or permits, baseline and credit allows businesses, industries, or nations to emit 1 tonne (1,000 kg) of CO2 or the equivalent quantity of another GHG.
Moreover, Europe held the largest share in 2022 due to the CO2 emissions in the region. Greenhouse gas emissions from the EU economy were 905 million tonnes of CO2 equivalents, in the second quarter of 2022, a rise of 3% from the same quarter in 2021.
The ambitious climate policies of the region and increased financial investment in the market are driving up the cost of pollution in Europe at a parabolic rise unlike any time since it began in 2005. The largest carbon trading program in the world is located in the European Union. Many firms have caps on their carbon dioxide emissions, and extra allowances can be bought and sold. The benchmark carbon price for the EU ended at USD 68.53 per metric ton, not far from its highest point since the market's inception. Moreover, prior to the coronavirus epidemic, in December 2021, carbon contract was only worth about USD 21.26, and it has now reached USD 53.14 for the first time.
The major players operating in the global carbon credit trading platform market are European Energy Exchange AG, Carbon Trade Exchange, Xpansiv Data Systems, Inc., CME Group Inc., Nasdaq Inc., Climate Impact X, Carbonplace, Likvidi Technologies Ltd., BetaCarbon Pty Ltd., and Carbonex Ltd.