Carbon Offset Market is Estimated to Witness High Growth
The carbon offset market involves reducing emissions of carbon dioxide or greenhouse gases and balancing them with carbon removal or carbon storage processes. Carbon offsets are measured in metric tons of carbon dioxide-equivalent (CO2e) and may represent six primary categories of greenhouse gases: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), perfluorocarbons (PFCs), hydrofluorocarbons (HFCs), and sulfur hexafluoride (SF6). Companies and individuals purchase carbon offsets to compensate for their own greenhouse gas emissions from various activities like driving cars, fuel usage, electricity consumption and industrial operations.
The global carbon offset market is estimated to be valued at US$ 414.8 Bn in 2023 and is expected to exhibit a CAGR of 8.6% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
The global carbon offset market offers opportunities for companies and governments to achieve carbon neutrality targets and climate goals established under the Paris Agreement. Carbon offsets provide a flexible, cost-effective way to balance carbon footprints and help limit overall emissions growth while cleaner technologies are developed. By supporting projects that prevent the release of greenhouse gases or remove carbon dioxide from the atmosphere, offsets can help higher-emitting sectors or countries achieve intermediate-term emissions reductions before transitioning to low-carbon alternatives. This presents a significant opportunity for participants across the carbon offset value chain to contribute meaningfully towards global decarbonization efforts over the coming decade.
Market Opportunity:
The opportunity to achieve carbon neutrality goals presents significant growth prospects for the carbon offset market over the forecast period. Both corporations and governments have pledged ambitious targets to be carbon neutral by 2030, 2040 and 2050 to stay within the Paris Agreement temperature limits and avoid the worst impacts of climate change. For example, the European Union's Green Deal and Fit for 55 legislative package aims to cut emissions by 55% by 2030 from 1990 levels and achieve climate neutrality by 2050. Similarly, more than 1200 companies with over $13 trillion in combined annual revenues have also set science-based carbon neutrality targets through initiatives like The Climate Pledge. This growing emphasis on achieving net-zero emissions increases the need and scalability of emission reduction activities represented by the carbon offset market
Porter's Analysis
Threat of new entrants: Low barrier to entry can attract more players to the carbon offset market. However, established players enjoy advantages of brand name, economies of scale, and access to resources.
Bargaining power of buyers: Large buyers in industries like aviation, oil & gas can negotiate lower carbon offset prices. However, buyers have limited options to reduce carbon footprint other than offset programs.
Bargaining power of suppliers: A few large suppliers cater to majority of carbon offset demand. Shift to renewable projects increases suppliers' bargaining power over pricing.
Threat of new substitutes: Technological advances may offer carbon removal solutions as an alternative to offsets. However, offsets are currently the most viable option for industries to achieve short-term emission targets.
Competitive rivalry: Intense competition among offset retailers and project developers to attract buyers. Competition drives innovation and reduction in project costs.
SWOT Analysis
Strength: Growing environmental awareness increases demand. Wide scope across industries, forestry and other sectors.
Weakness: Lack of uniform carbon accounting standards. Difficult to accurately quantify and verify emission reductions.
Opportunity: Shift to greener infrastructure post COVID-19 raises investments in offset projects globally. New regulations increase compliance need.
Threats: Changing climate policies impact project viability and offset demand. Natural disasters may damage afforestation projects.
Key Takeaways
The Global Carbon Offset Market Size is expected to witness high growth over the forecast period. The market size for 2023 is projected to reach US$ 414.8 Bn, growing at a CAGR of 8.6% between 2023 and 2030.
Regional analysis: North America dominates currently due to stringent emission norms. However, Asia Pacific is emerging as the fastest growing regional market, led by China, India and other developing nations actively reducing carbon footprint.
Key players: Key players operating in the carbon offset market are AptarGroup, Weener Plastics Group, Bormioli Rocco Pharma, Pacific Packaging Components, PCC Exol, SHL Group, O.Berk Company, Winfield Laboratories, O.Berk, Comar, RPC Group, Alpha Packaging, Pretium Packaging, Silgan Holdings, Origin Pharma Packaging, Vidchem pty ltd, Mold-Rite Plastics, Berry Global, and Amcor.
Explore more information on this topic, Please visit -
https://www.ukwebwire.com/carbon-offset-market-size-and-trends-analysis/
Explore more trending article related this topic -