The Climate and Carbon Finance market is estimated to be valued at US$ 459.58 Mn in 2023 and is expected to exhibit a CAGR of 29. % over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Climate and carbon finance market deals with providing financing solutions to organizations for voluntarily reducing their carbon footprint. It facilitates carbon trading and offsetting initiatives to help achieve emission reduction targets. Some common products in this market include carbon credits, carbon offsets, and renewable energy certificates.
Market Dynamics:
Increasing regulation for carbon emission reduction across industries is expected to be a major driver for this market. Various countries and regional blocks have implemented strict policies and guidelines to curb greenhouse gas emissions to mitigate climate change. Non-compliance can lead to heavy financial penalties. This has prompted organizations to proactively invest in emission reduction projects and carbon offsets.
Moreover, growing carbon pricing initiatives are also fueling demand. Over 60 carbon pricing programs have been implemented worldwide covering about 20% of global emissions. A higher and expanding carbon price signals the need for more abatement projects, boosting investment opportunities in this sector.
SWOT Analysis
Strength: Climate and carbon finance market leverages advanced technologies such as blockchain, artificial intelligence etc for effective monitoring and reporting of emission reduction. There is a strong policy push for climate action globally which fuels market growth. Wide range availability of offset credits attracts more buyers.
Weakness: Verification and additionality issues related to offset projects hamper market potential. High transaction costs affect small project developers. Lack of standardization in methodologies and processes lead to fragmentation.
Opportunity: Growing carbon pricing initiatives worldwide open new avenues. Advancements in MRV technologies strengthen market integrity. Shift towards net zero targets and sustainability goals present massive opportunities.
Threats: Stringent regulations may raise compliance costs. Delays in policy implementations can negatively impact investments. Technology disruptions pose challenges to business models. Trade tensions and geopolitical issues introduce uncertainties.
Key Takeaways
The global climate and carbon finance market is expected to witness high growth, exhibiting CAGR of 29.% over the forecast period, due to increasing occurrence of extreme weather events and stringent government policies on emission cuts. The market size is projected to reach US$ 459.58 Mn by 2023 from US$ 184.27 Mn in 2020.
Regional analysis
Europe dominates the global market currently due to strong climate action policies of the EU. The region accounts for over 35% market share led by developed nations like UK, Germany, and France. Asia Pacific exhibits fastest growth aided by the increasing number of carbon offset projects in major economies like China and India. Rapid industrialization and rising investments in renewable energy drive the regional market.
Key players
Key players operating in the climate and carbon finance market are Climate Finance Partners, Carbon Credit Capital, ClimateCare, South Pole Group, Climate Trust Capital, Carbon Clear, EcoAct, First Climate, ClimatePartner, Ecosphere+, Verra, Gold Standard, Natural Capital Partners, Climate Friendly and Forest Carbon.
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https://www.rapidwebwire.com/climate-and-carbon-finance-market-size-share-growth-outlook-2023/
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