The voluntary carbon market (VCM) experienced an unprecedented surge in 2024, with $16.3 billion invested across the sector, according to Abatable’s latest report. This marked an 18-fold increase in the total value of carbon credit retirements, signalling a clear shift toward long-term sustainability commitments over short-term offset purchases.
A close-up of many young tree seedlings, with workers in the background checking their condition, and a plane flying overhead. AI generated picture.
The growth highlighted the rising importance of carbon credits in corporate sustainability strategies. Throughout the year, companies, governments, and investors faced mounting pressure to embed environmental action into their operations. Global regulations tightened, particularly with the European Union’s Carbon Border Adjustment Mechanism (CBAM) imposing tariffs on carbon-intensive imports—pushing demand for verified, high-quality carbon credits even higher.
In 2024, businesses continued to lead as the largest buyers of carbon credits, with a focus on tackling Scope 3 emissions—those indirect emissions tied to supply chains, transportation, and other external factors. The aviation sector became a major driver of demand, with the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) projected to increase the need for credits by 135–182 million tonnes by 2026, which will amount to as much as 37% of the market’s total retirements that year.
Corporate giants like Microsoft, Google, Delta Air Lines, and Amazon strengthened their sustainability commitments. Microsoft pledged to purchase millions of tonnes of carbon removal credits, while Amazon expanded its investment in large-scale forest conservation initiatives to balance its growing carbon footprint.
Read more: Google’s carbon strategy: over $100m purchased credits in 2024
A significant trend in 2024 was the growing investor preference for carbon removal projects over avoidance-based credits. Technologies such as direct air capture (DAC) and nature-based solutions like afforestation became highly sought after due to their ability to offer measurable, permanent reductions in carbon levels.
In contrast, older avoidance credits—particularly those under the REDD+ framework—faced declining prices, reflecting doubts about their effectiveness. However, newer REDD+ projects adhering to stricter standards attracted increased investor interest due to their enhanced credibility.
Blue carbon credits, derived from coastal ecosystems like mangroves and seagrasses, also gained traction. These projects proved attractive not only for their superior carbon sequestration potential but also for their benefits in protecting biodiversity and supporting local communities.
The credibility of the carbon market improved significantly in 2024, with half of all retired credits meeting high-quality benchmarks such as the Integrity Council for the Voluntary Carbon Market’s (IC-VCM) Core Carbon Principles (CCPs). This represented a notable jump from 29% in 2021.
Technology also played a crucial role in improving transparency. Blockchain-based carbon tracking and digital measurement, reporting, and verification (dMRV) tools helped minimise the risks of fraud and double counting, giving investors more confidence in the market’s integrity.
While demand remained strong, an oversupply of older credits contributed to price drops in 2024. In contrast, high-quality removal credits like biochar retained their value, trading between $200 and $1,200 per tonne.
Experts forecast that premium removal credits will continue to command high prices in the coming years, while lower-quality credits may struggle to find buyers. Evolving financial tools—such as forward contracts and pre-financing agreements—are expected to provide businesses with greater certainty, positioning them to meet increasingly stringent sustainability targets and regulatory requirements in the future.
Read more: A firsthand look at DGB’s impact in Kenya
As the voluntary carbon market evolves, the demand for high-quality, verifiable carbon credits is only set to grow. At DGB Group, we’re at the forefront of this transformation, offering nature-based solutions that don’t just compensate for emissions—they regenerate ecosystems, boost biodiversity, and empower local communities. For businesses seeking to stay ahead of tightening regulations and rising investor expectations, our large-scale projects provide both environmental impact and measurable value. Ready to lead with purpose? Explore how our solutions can elevate your sustainability strategy today.
