The global carbon credit market is experiencing robust growth, projected to reach USD 1,602.7 billion by 2028 from USD 414.8 billion in 2023, a remarkable 31.0% compound annual growth rate that nearly quadruples the market in five years.
The global carbon credit market is experiencing healthy growth, driven by strengthening global efforts to combat climate change, increasing corporate net zero commitments, and changing regulatory frameworks. The carbon credits market is highly dynamic, offering promising opportunities across both voluntary and compliance segments, and continues to be at the core of international sustainability initiatives.
This growth reflects a strategic shift in how corporations’ approach decarbonization. Rather than pursuing immediate, wholesale emissions reductions, companies are increasingly adopting “partial use” carbon credit strategies purchasing offsets incrementally and banking unused credits for future projects. This approach reduces costs while maintaining progress toward net-zero targets.
Voluntary Markets Surge on Transparency Gains
The voluntary carbon market segment is projected to be the fastest-growing category, outpacing compliance-driven markets. Improvements in credit quality verification have transformed voluntary markets from opaque systems into trusted platforms where corporations can confidently invest in offsets without regulatory mandates, per the MarketsandMarkets report.
Sector and Regional Dynamics
The power sector is expected to remain the largest end-user segment through 2028, driven by high emissions and access to low-GHG technologies. However, transportation is emerging as the fastest-growing segment as electric vehicle adoption accelerates.
Regionally, Europe maintains the largest Global Carbon Credit Market share, anchored by the EU ETS. Yet Asia Pacific is positioned for the fastest growth between 2023-2028, fueled by China’s integration of emissions trading systems into its climate policy framework.
The expanding Carbon Credit Market Size offers significant opportunities for developing nations to generate revenue through offset sales while financing community development projects. However, challenges remain carbon credit leakage (emissions relocated rather than eliminated) and price volatility continue to threaten market stability.
The global Carbon Credit Market represents more than an investment opportunity it’s a fundamental shift in how economies value environmental impact. With the market poised to nearly quadruple in five years, reaching $1.6 trillion by 2028, the time for strategic positioning is now, explore the full Carbon Credit Market Report from MarketsandMarkets.
Key Players Shaping the Market
The carbon credit ecosystem features established project developers, exchange partners, and verification bodies that have operated for years with sophisticated technologies and global networks. Major players include South Pole Group (Switzerland), 3Degrees (US), Finite Carbon (US), EKI Energy Services Ltd. (India), and NativeEnergy (US).