The carbon credit price is determined by various tools, and as of April 2022, there are 68 carbon pricing instruments globally, covering approximately 23% of global greenhouse gas emissions. These tools play a crucial role in pricing carbon and regulating emissions. Let's delve into the details of carbon pricing tools.
The carbon credit price is an increasingly vital concept in valuing activities that emit greenhouse gases. It represents the economic and environmental value of reducing emissions. This article analyzes how carbon credit prices are determined and their impact on businesses and the environment.
The global carbon credit market experienced significant growth in 2021, with revenue reaching approximately USD 84 billion, a substantial increase from the USD 31 billion in 2020. This surge reflects the rising carbon and ETS (Emissions Trading System) prices, particularly within the EU-ETS, which contributed 41% to the total revenue. Other systems, such as those in New Zealand and California, also played a role. ETS revenue in 2021 surpassed carbon taxes, accounting for 67% of total revenue.
Carbon taxes increased in the same year and continued to rise in 2022, with clear plans for price hikes in various legal jurisdictions, such as Singapore.
While the carbon credit market is growing and playing a crucial role in driving global environmental policies, current carbon prices remain relatively low compared to what is needed to achieve the goals of the Paris Agreement. Proposed prices range from $50-100 per ton to maintain the goal of keeping global temperature increase below 2 degrees Celsius and $50-250 per ton (average of $100 per ton) to achieve net-zero emissions by 2050 and limit temperature increase to 1.5 degrees Celsius.
As of April 2022, the world has witnessed the operation of 68 carbon pricing instruments, covering approximately 23% of global greenhouse gas emissions.
Between May 2021 and May 2022, the carbon pricing industry saw the introduction of a new carbon tax in Uruguay and three new ETS systems in Oregon, New Brunswick, and Ontario. Carbon pricing not only extends through existing tools but also through new implementation plans in Indonesia, Austria, and the U.S. state of Washington.
Several other countries and regions are researching and expressing their intention to develop their carbon pricing tools, including Israel, Malaysia, and Botswana. Notably, Vietnam is planning and outlining a roadmap to establish its ETS.
3D Master is recognized as one of the reputable entities in Vietnam providing carbon credit pricing services. With a team of top experts in Vietnam deeply understanding the carbon credit market, 3D Master proudly offers professional services based on thorough analysis and the latest trends from the international market.
Committed to pursuing sustainable development goals, 3D Master contributes to shaping a transparent, efficient, and vibrant carbon market in Vietnam, fostering the energy transition and climate change adaptation locally and globally.
Carbon pricing and the carbon credit market in Vietnam are becoming increasingly important. Businesses and individuals can leverage these opportunities to not only reduce environmental impact but also achieve high economic value.
