The Voluntary Carbon Market in 2024: A Year of Progress and Optimism

As 2024 quickly winds down, it is the perfect time to pause and acknowledge the advances made in the voluntary carbon market (VCM), which will put us on a solid path to success in 2025. The industry’s collective accomplishments of this past year reflect a growing sense of urgency for climate action and recognition that the VCM is an effective tool for mitigating climate change. Four key reasons I am optimistic about next year and beyond are the:

1. Advancement of Article 6 at COP29
2. Initial releases of ICVCM Core Carbon Principles (CCP) labels
3. Refinement of the Oxford Principles
4. Positive momentum on climate-focused aspects of the Inflation Reduction Act (IRA)

The finalization of Article 6 of the Paris Agreement was a significant milestone and will bolster confidence in the global community’s ability to collaboratively address climate change. Providing a framework for market mechanisms that support international cooperation and the transfer of carbon credits between countries, the agreement at COP-29 solidified the role of carbon credits as essential tools for achieving climate impact.
 

We also saw the rollout of the initial tranche of CCP labels. We applaud the standardized metrics and criteria for evaluating projects to help to build VCM confidence, and we look forward to the expansion of the program to include additional carbon credit methodologies over the coming months.

The release of the revised Oxford Principles is another VCM win. The updated principles emphasize the importance of both carbon removals and avoidance strategies, ensuring that projects curtail emissions and proactively extract carbon from the atmosphere to help maximize carbon market impact.

Despite concerns about the new administration's approach to U.S. environmental policies, central aspects of the Inflation Reduction Act (IRA), targeting renewable energy and climate mitigation, are likely to continue to progress and create a supportive setting for carbon projects. The IRA has bolstered varied local economies from the grain belt to the coasts as companies are incentivized to reduce emissions and invest in renewable energy.

With all the progress we’ve seen in 2024, I am bullish about more companies committing to ambitious emissions reduction targets and the demand for high-quality carbon credits continuing to grow. Companies like TotalEnergies and Microsoft are leading the way with their inclusion of carbon credits as part of comprehensive climate action plans.

Thank you to my colleagues at Anew and others across our industry who continue to work diligently to advance the VCM as one of the most effective tools for immediate climate mitigation.

Wishing you all a happy and healthy holiday season.