July 12, 2024

Carbon Verification Market Estimated To Witness High Growth Owing To Rising Carbon Neutrality Commitments And Stringent Emission Compliance Policies

The Carbon Verification Market is estimated to be valued at US$ 12.73 billion in 2023 and is expected to exhibit a CAGR of 26% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:

Carbon verification involves independent third-party validation and verification of carbon footprint inventories, emissions reduction projects, and offsets to ensure accuracy and credibility. Organizations across various industries such as oil & gas, manufacturing, mining, and utilities utilize carbon verification services to quantify, manage, and reduce their environmental impact. Carbon verification helps companies track progress towards sustainability goals, comply with emission reporting mandates, and market carbon credits.

Market Dynamics:

Growing carbon neutrality commitments from governments and corporations worldwide is expected to be a major driver for the carbon verification market over the forecast period. Many countries and organizations have pledged to achieve net-zero emissions by 2050 or earlier, which is fueling demand for carbon accounting and offsetting. For instance, the European Union plans to introduce a Carbon Border Adjustment Mechanism that taxes imported goods based on their carbon footprint, compelling trading partners to strengthen climate policies. Additionally, increasingly stringent emission compliance policies are also propelling the need for independent verification of emissions data. For example, regulations such as the EU Emission Trading System penalize non-compliance and require participants to submit verified annual emissions reports. Failure to account for and offset carbon emissions accurately can result in costly penalties.

Moreover, rising awareness about climate change impacts and stakeholder expectations of transparency are also contributing to market growth. Organizations perceive carbon neutrality claims without credible verification as “greenwashing”. Therefore, third-party validation provides credibility to sustainability communications and marketing around emissions reductions. In addition, carbon credits

Segment Analysis

 

The global carbon verification market is dominated by the third-party verification segment. Third-party verification provides independent and unbiased validation of carbon footprint calculations and claims. It helps organizations credibly communicate their sustainability efforts and climate actions to stakeholders. Third-party verification is considered the gold standard for carbon accounting due to its high degree of transparency and integrity.

PEST Analysis

Political: Regulations and policies around carbon emissions are becoming more stringent globally. Many countries have committed to net zero targets and have introduced carbon pricing mechanisms which is driving demand for carbon verification services.

Economic: Rising carbon taxes and compliance costs of not meeting regulatory emission norms are encouraging organizations across industries to quantify and reduce their carbon footprint. This represents an opportunity for players in the carbon verification market.

Social: Growing climate change awareness among consumers is pushing companies to transparently report and validate their ESG performance. Carbon neutrality claims need to be certified by independent parties to gain credibility.

Technological: adoption of artificial intelligence, remote sensing, and IoT solutions help automate data collection and analysis for carbon accounting. This is improving the efficiency and scalability of carbon verification processes.

Key Takeaways

The global Carbon Verification Market is expected to witness high growth, exhibiting CAGR of 26% over the forecast period 2023 to 2030, due to increasing regulatory compliance requirements related to carbon emissions and climate disclosure mandates. The market size is estimated to reach US$ 12.73 billion in 2023.

Regionally, North America dominated the carbon verification market in 2022 owing to stringent federal and state-level carbon laws in countries like the US. Europe is also a major region due to the EU Emissions Trading Scheme making carbon quantification and reporting mandatory for a large number of organizations. Asia Pacific is expected to be the fastest growing regional market, led by China,India and other developing countries ramping up climate action plans and adopting carbon neutrality roadmaps.

Key players operating in the carbon verification market are DNV GL, SGS SA, Bureau Veritas, TÜV NORD GROUP, Intertek Group plc, Carbon Trust, First Environment, Inc., ERM Certification and Verification Services, NSF International, UL LLC, Cotecna, SCS Global Services, KPMG International Cooperative, Deloitte Touche Tohmatsu Limited, and PwC. DNV GL dominates the market owing to its global presence and comprehensive portfolio of assurance and carbon management services.

*Note:

  1. Source: Coherent Market Insights, Public sources, Desk research
  2. We have leveraged AI tools to mine information and compile it