Maneuvering the Mosaic. State of the Voluntary Carbon Markets 2013

Summary

2012 KEY FINDINGS

• In 2012, voluntary actors contracted 101 million tonnes of carbon offsets (MtCO2e) for immediate or future delivery – 4% more than in 2011. Market value decreased 11% to $523 million as offset prices fell slightly for several popular project types (Figure 1). 

• 90% of offset volumes were contracted by the private sector – where corporate social responsibility and industry leadership were primary motivations for offset purchases.

• Offset buyers’ desire to positively impact the climate resilience of their supply chain or sphere of infl uence was evident in our data which identifi es a strong relationship between buyers’ business sectors and the project categories from which they contract offsets.

• Most forward contracts spanning multiple years were negotiated between project developers and offset end users – providing some indication of future corporate demand for carbon offsets, particularly from project types that confer additional environmental and social benefi ts.

• A sizeable portion of market value (64% of value associated with a contract type or $170 million) was paid to offset sellers at the point of transaction rather than offset delivery – primarily via spot contracts (35.6 MtCO2e, up 25% from 2011) and pre-payment for future delivery (8.7 MtCO2e, down 1% from 2011).

• Demand surged for carbon offsets from forestry projects certifi ed to the Verifi ed Carbon Standard and Climate, Community and Biodiversity Standards. Voluntary buyers also funneled $80 million to Gold Standard-certifi ed offsets from projects that distribute clean cookstoves and water fi ltration devices.

• Suppliers predict market value could reach $1.6 - $2.3 billion in 20201 – if market actors can effectively communicate the relevance of offsetting and carbon market infrastructure to private sector actors, the international donor community, and governments seeking tools to incentivize, verify, and fi nance climate action.