New Energy World™
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Untapped opportunities – the countries flying under the radar for climate investment
20/9/2023
8 min read
Feature
How countries interact with Article 6 of the Paris Agreement will have a large bearing on their climate investment performance in the coming years. Here, Abatable’s Pauline Blanc and Marc Height* explain the opportunities for investment in voluntary carbon market projects across a range of countries – as summarised in the company’s VCM Investment Attractiveness Index.
Despite recent market turbulence, whatever forecast you look at, the voluntary carbon market (VCM) is set for substantial growth over the coming decades.
BCG and Shell valued the market at $2bn annually at the start of the year and projected it would reach between $10bn and $40bn by 2030. More recently, following the drop in carbon credit prices seen since January, Barclays estimated the VCM was worth $500mn today, but said it could grow substantially to $250bn/y by 2030 and by $1.5tn/y by 2050.
This forecast growth is good for climate action. If we are to meet our climate targets, the growing emissions gap between our current global CO2 output and where we need to be to keep warming at 1.5°C needs to close. Climate finance will be critical in making this happen. Carbon-sequestering ecosystems need protecting, and investment channelled through the VCM into high-quality carbon projects can play a fundamental role in enabling this.