IEF – Carbon Markets Report, Mar 2024

The evolving carbon markets offer a promising opportunity to lower costs associated with carbon removal and offset emissions. By promoting cross-border trade in carbon credits, these markets can boost net-zero carbon balances and enhance global collaboration. Governments need to ensure that evolving carbon markets benefit both consumers and producers, while also shaping a global framework to govern these markets effectively. Voluntary Carbon Markets (VCM) can strengthen global energy and climate policy coherence and provide insights into best practices for countries and businesses. Carbon market revenues can serve as a supplementary source of climate finance, supporting Sustainable Development Goals (SDGs) and reducing dependence on national public support schemes. Incentives from carbon markets can help scale up Circular Carbon Economy (CCE) solutions, including clean hydrogen production and Carbon Capture and Utilization (CCU) technologies. Enhanced digitalization and coding can improve transparency and accountability in carbon market data, boosting investor confidence and advancing the transition towards low-carbon materials in material-intensive industries.