Carbon Credit Market To Reach $6,129.87 Billion By 2033

December 2025 | Report Format: Electronic (PDF)

Carbon Credit Market Growth & Trends

The global carbon credit market size is expected to reach USD 6,129.87 billion by 2033, registering a CAGR of 25.9% from 2026 to 2033, according to a new report by Grand View Research, Inc. The market is expected to expand at a lucrative CAGR of 38.7% during the forecast period. The demand for carbon credits has been rising substantially in recent years due to various factors, such as several governments introducing policies and regulations that are aimed at reducing greenhouse gas emissions.

The significant demand for carbon credits has been helped by companies increasingly recognizing the importance of sustainability and of reducing their carbon footprint as part of their corporate social responsibility initiatives. This has led to carbon credits becoming a vital aspect for organizations to offset their emissions. In addition, growing concerns about climate change and its potential impacts have also created strong traction in the carbon credits space.

Governments around the world are implementing policies and regulations to reduce greenhouse gas emissions and combat climate change. Many of these regulations require companies to offset their emissions by purchasing carbon credits. These factors are expected to drive the compliance carbon credit market globally.

Compliance was the dominant segment in the global market for carbon credits in 2022 with a revenue share of 98.91%. The compliance carbon credit market is where companies and organizations that are regulated by a government or a specific authority are required to offset their carbon emissions by purchasing carbon credits. These credits represent a reduction in greenhouse gas emissions from an approved project, such as renewable energy or energy efficiency initiatives.

The COVID-19 pandemic has been a major restraint to the advancement of the carbon credit market, owing to several factors including reducing operational costs by end-users, along with extensive disruption in the availability of spare parts across the globe due to sluggish manufacturing activities and logistics issues.

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Carbon Credit Market Report Highlights

Compliance segment held the largest revenue share of over 98% in 2025. Based on type, the market is further categorized into compliance and voluntary
Avoidance / Reduction projects turbines held the largest revenue share of over 65% in 2025. Based on project type, the market is divided into removal/sequestration projects and avoidance/reduction projects
Power segment held the revenue share of over 31% in 2025. The power segment emerged as the largest segment in 2025 with a revenue share of 31.36%.
The energy segment is projected to register the fastest CAGR of 27.5% over the forecast period, supported by accelerated clean energy transitions, expanding renewable project pipelines
Europe held over 88.68% revenue share of the global carbon credit market. The market is based on the EU’s Emissions Trading System (ETS), which is the largest carbon market in the world.