Lesson 1, Topic 1
Growth opportunities in the Voluntary Carbon Market
As the market increasingly recognizes the relevance of addressing voluntary actions towards climate change, new growth opportunities are presented in the VCM:
- Market demand and environmental awareness: Consumers and investors are demanding organizations to decarbonize their operations and reach their corporate sustainability commitment targets, which leads into an increase in the demand of carbon credits.
- Regulation changes: Supportive policy frameworks and regulations that recognize and incentivize voluntary carbon markets can urge their growth. Governments can play a role by implementing measures to promote the use of verified carbon credits, creating market mechanisms and guidelines for project development.
- Innovations and technology: As new technologies arise, new project types that are able to implement these technologies will appear in the market. Besides, advancements on other technologies such as digitization, satellite monitoring, or blockchain, can attract new participants and increase efficiency and integrity.
- Market expansion: Corporate reporting, is gaining increased attention. VCM can support organizations to address and offset their Scope 3 emissions. Also, VCM could expand geographically in the emerging economies that implement their targets and regulations as a support for activities beyond the compulsory requirements.
- Financial access and commitments: Clear buyer commitments under long term agreements for carbon credits purchase will enhance price certainty and enable projects financial security and their possibility to scale up.