As global businesses and governments prioritize reducing carbon emissions, carbon credits are increasingly vital to achieving sustainability goals. The voluntary carbon market (VCM) has gained momentum as companies look to compensate for their emissions while enhancing their environmental responsibility. As highlighted in the Abatable Voluntary Carbon Market Developer Overview for 2023–2024 report, the market is undergoing significant changes, driven by a combination of market dynamics, new regulations, and corporate demand for verified carbon credits. Here we share with you the 3 key market trends and dynamics that are awaiting us in 2024 according to the report.

1. Voluntary carbon market buyers have multiplied by 6 in just 5 years

In 2018, the VCM had only about 1,000 buyers. By December 2023, Abatable reports that this number had surged to over 6,000 buyers across the four main registries: Verra, Gold Standard, ACR, and CAR. This marks a significant increase in just five years.

Last year alone, approximately 2,000 new buyers entered the market and retired carbon credits, indicating strong momentum in buyer participation. Many of these new entrants were testing the waters, purchasing and retiring only a small number of credits as they began to shape their purchasing strategies, evaluate project criteria, and establish partnerships.

This pattern suggests that new buyers, while starting small, are likely preparing for larger transactions in the future. By defining their strategies early, these companies are positioning themselves to scale their purchases over time.

Historically, the market has been concentrated among a smaller group of buyers. In fact, just 100 buyers accounted for over 40% of all credits retired in 2023. However, with the continued growth in the number of participants, we could soon witness carbon credits becoming a mainstream tool for channelling finance toward environmental protection.

Discover more: Why carbon credit prices will rise?

2. The emergence of a two-speed market

According to Abatable’s report, the voluntary carbon market is navigating a period of transition as it responds to emerging challenges and opportunities. One of the most significant trends is the emergence of a two-speed market, where some developers are moving quickly to align their projects with the high-integrity benchmarks set by the Core Carbon Principles (CCPs). 

In 2024, the Integrity Council for the Voluntary Carbon Market (ICVCM) introduced the CCPs to ensure that only high-quality projects receive verification. As a result, developers must adhere to stricter guidelines to meet these new quality standards. This shift is redefining the baseline for carbon project quality, with high-integrity projects — particularly those that are nature-based — being rewarded with higher demand and premium pricing.

These developers are poised to benefit from the growing demand for high-quality credits, while those sticking to older methodologies may struggle to maintain value as new market standards evolve.

3. Nature-based solutions become the preferred asset

Abatable’s report highlights an increasing oversupply of carbon credits, which has led to price dispersion, particularly between avoidance credits and removal credits. While avoidance credits (which represent emissions prevented, such as through renewable energy projects) have seen a drop in prices, removal credits (such as those from reforestation) have maintained higher demand and premium pricing. 

This growing preference for removal credits reflects the market’s shift toward high-integrity, nature-based solutions that offer long-term environmental benefits.

The focus on nature-based solutions and the integration of biodiversity initiatives are expected to become key drivers of market activity in 2024. This shift is partly fueled by corporate commitments to more transparent reporting on nature-related financial disclosures and the growing regulation of deforestation-free products.

Discover more: Driving revenue through sustainability initiatives

The role of VanderStyn in promoting sustainable impact through carbon credits

For investors looking to capitalize on the growing demand for high-integrity carbon credits, VanderStyn offers a unique opportunity through its Green Carbon Fund. Launched during Climate Week 2024 in New York, this fund provides investors access to high-value, verified carbon projects — a market typically reserved for large corporations. VanderStyn’s portfolio focuses on nature-based solutions, such as reforestation, habitat restoration for endangered species, as well as energy-efficiency projects.

By investing in the Green Carbon Fund, investors can align their financial goals with environmental impact, benefiting from the rising demand for verified carbon credits while creating a positive and sustainable impact in nature.

Discover more: Green Impact Fund: a strategic approach to sustainable investing

The promising future of the voluntary carbon market

The voluntary carbon market is at a pivotal moment, with growing demand for high-quality nature-based credits driving its evolution. As companies increasingly focus on achieving sustainability goals, green investing offers a compelling opportunity for both financial returns and environmental impact. By partnering with platforms like VanderStyn’s Green Carbon Fund, investors can support projects that not only reduce their carbon footprint, but also promote biodiversity, community development, and long-term ecosystem health.

The future of the VCM lies in high-integrity, verified credits, and those who invest wisely today will help shape a more sustainable tomorrow.