A report released by oil giant, Shell on Thursday has shown that voluntary carbon markets are on course to become at least five times bigger by 2030 as they are expected to transact volumes comparable to annual emissions by the global aviation industry in 2019.
In the report co-authored by the Boston Consulting Group (BCG), it is projected that the voluntary carbon offset market, which currently transacts at 500 million tonnes and was worth about $2 billion in 2021, will grow to $10-40 billion in value by 2030, transacting 0.5-1.5 billion tonnes of carbon dioxide equivalent.
Despite bullish projections on the growth of the carbon markets, it might still be years before countries can offset their emissions in an international carbon market first called for in Article 6 of the 2015 Paris climate accord.
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Key outstanding issues include the extent to which countries’ registries, or digital ledgers of carbon trades, might be exposed to outside scrutiny.
โWhere previous projections had shown a demand for credits starting to outstrip supply in 2024, data from 2021 shows this may happen even earlier for some classes of credits,โ the company said in a statement.
Shell said the carbon market projections in the report showed demand for credits accelerating and supply tightening but critics said they allow emitters to continue to release greenhouse gases.
Surveys in the report showed that buyers were seeing spending on carbon credit purchases as necessary, Shell said, adding that reputable monitoring, reporting and verification were seen as the most important purchasing criteria.
โAs the market continues to grow at an accelerated pace, it will become increasingly important to grow with integrity through a high grading of credit quality,โ Shell quoted BCG’s Managing Director Anders Porsborg-Smith as saying.
Story was adapted from Reuters.
