Investment in carbon credit projects has surged, with over $36 billion invested in the last decade, marking a significant shift towards climate action in the corporate world. This data, unveiled in a study by Trove Research, showcases the transition from niche to mainstream corporate climate efforts.
A local man planting young seedling in a tree nursery in Kenya - Hongera Reforestation Project, DGB.
Commissioned by the International Emissions Trading Association (IETA), Verra, and Sylvera, the study highlights a remarkable increase in investment activity, with more than $18 billion raised for carbon credit funds in the last two and a half years alone.
Moreover, since 2020, there has been a 160% surge in the registration of over 1,500 new carbon credit projects with the five leading carbon registries compared to the preceding eight years. These projects have the potential to save up to 300 million tonnes of carbon dioxide annually, equivalent to the UK's yearly emissions.
Remarkably, there are plans for another 1,500 projects, beyond those registered in the past three years, which could further save approximately 500 million tonnes of carbon dioxide annually.
Read more: The rising demand for nature-based credits
Nature-based projects, encompassing afforestation, reforestation, and forest management, attracted 80% of the funding in the decade leading up to 2022, covering an area comparable to Italy's landmass.
Despite this progress, the current pace of investment falls short of what's needed to achieve the Paris Agreement’s 1.5°C goal. To reach this target, an additional $90 billion in capital is required by 2030, as per Trove's research. This underscores the urgency of increased investment in carbon credit projects to combat climate impacts effectively.
This wave of investment not only promises carbon reduction projects but also provides a growing stream of carbon credits, aiding corporations in their decarbonisation efforts. As we witness this surge, the world is on a path to meaningful climate action.
Combining data from the publisher's website, this major study by Trove Research reveals that between 2012 and 2022, investments in carbon credit projects reached an impressive $36 billion, with more than half of this sum secured in the last three years. An additional commitment of over $3 billion for future investments is set to usher in a new era of carbon reduction initiatives, ranging from forest protection to carbon capture and storage.
Read more: UAE Carbon Alliance commits a staggering $450 million to African carbon credits
DGB Group, committed to creating and implementing large-scale nature-based solutions, firmly believes that carbon credits are the linchpin for achieving a viable net-zero future while safeguarding our invaluable ecosystems. By harnessing the immense potential of nature, we can unlock innovative solutions that not only combat climate change but also champion biodiversity preservation. Through our top-tier carbon credits, you can achieve your business’ sustainability goals whilst making a positive environmental impact. Together, let us embark on this transformative journey, embracing nature-based solutions as the cornerstone of our environmental strategies, ensuring a brighter and greener future for all.
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