The climate and carbon finance market facilitates projects that reduce greenhouse gas emissions and mitigate the effects of climate change. Carbon credits generated from projects such as renewable energy installations, reforestation efforts, and industrial emissions reductions can be traded in carbon markets. Owners of high emission assets purchase these carbon credits to offset their carbon footprint and meet regulatory compliance targets. The global climate change agreements and Paris Accord have accelerated the development of carbon pricing mechanisms and emissions trading schemes worldwide.
The climate and carbon finance market connects governments, corporations and project developers to fund initiatives that curb emissions. Carbon offset projects in sectors like forestry, waste management and energy efficiency help lower the carbon intensity of businesses while generating tradeable carbon credits. Carbon trading allows companies flexibility to lower emissions where it is most cost-effective through market forces.
The global Climate and Carbon Finance Market is estimated to be valued at US$ 529.44 Mn in 2024 and is expected to exhibit a CAGR of 3.6% over the forecast period 2024-2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends: One of the major trends in the climate and carbon finance market is the rising participation in voluntary carbon markets. Many companies set internal carbon pricing and emission reduction goals to achieve net zero targets by 2050. They purchase voluntary carbon credits from nature-based projects to offset hard-to-abate emissions. Corporate demand is driving new program designs that align voluntary carbon standards with science-based guidelines. Another key trend is the integration of climate risk into investment decisions of large financial institutions and asset managers. As climate change poses risks to global financial stability, investors are increasingly shifting capital away from high-emission activities to low-carbon technologies and climate solutions.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is moderate as climate and carbon finance market requires large initial investments and established supply networks. However, dropping prices of renewable energy equipment may encourage new players to enter this market.
Bargaining power of buyers: The bargaining power of buyers is moderate as there are many alternatives available in the market. However, demand for low carbon solutions is increasing buyers influence.
Bargaining power of suppliers: The bargaining power of suppliers is low as raw materials required for climate and carbon finance market such as renewable energy components have many suppliers globally.
Threat of new substitutes: The threat of substitutes is moderate as there are alternatives available such as traditional energy sources. However, stringent regulations to reduce carbon emissions are driving demand for low carbon solutions.
Competitive rivalry: The competitive rivalry is high among existing players to gain higher market share through product innovations, partnerships and geographical expansion.
Key Takeaways
The global Climate And Carbon Finance Market Growth is expected to witness high growth over the forecast period supported by stringent government regulations and policies to reduce carbon emissions. The global Climate and Carbon Finance Market is estimated to be valued at US$ 529.44 Mn in 2024 and is expected to exhibit a CAGR of 3.6% over the forecast period 2024-2031.
Regional analysis: Asia Pacific region dominates the climate and carbon finance market holding around 35% of the overall share in 2024 owing to robust growth in renewable energy sector in China and India. Europe is also one of the major markets for climate and carbon finance driven by the climate change agreements and initiatives by European Commission to become carbon neutral by 2050.
Key players: Key players operating in the climate and carbon finance market include International Paper Company, Georgia-Pacific LLC, Finch Paper LLC, Burgo Group SPA, Alberta Newsprint Company Ltd., Rolland Enterprises Inc., P.H. Glatfelter Co., American Eagle Paper Mills, Asia Pacific Resources International Holdings Ltd., Canfor Corporation, Domtar Corporation, Twin Rivers Paper Company Inc., UPM-Kymmene Oyj, BillerudKorsnäs AB, Catalyst Paper Corporation, Clearwater Paper Corporation, Stora Enso Oyj, Verso Corporation, Mitsubishi Paper Mills Limited, Delta Paper Corp., and others. International Paper Company and Georgia-Pacific LLC are recognized as the market leaders owing to their large product portfolio and global presence.
For more insights, read- https://www.newswirestats.com/climate-and-carbon-finance-market-size-and-opportunity-analysis/
For more insights, read- https://dailynewsmotion.weebly.com/report-blog/innovations-in-healthcare-navigating-the-cell-and-gene-therapy-market
