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Carbon markets are generally defined as market-driven instruments that help decarbonize sectors or economies

 
While carbon markets come in diverse forms with variations between regions, they may generally be divided into two categories:

  1. Mandatory or compliance markets are created and controlled by government entities. They are used by companies, jurisdictions, or other entities legally required to offset their emissions.
  2. Voluntary markets are administered by independent, non-government organizations, operating outside but alongside mandatory markets. It allows private entities and individuals to voluntarily purchase offsets to reduce their carbon or other emission footprint.

Vancouver players have been swift to capitalize on BC’s early leadership in carbon pricing and regulations. Combined with the City of Vancouver’s own emissions-reduction policies, regulations and strategies – such as the Climate Emergency Action Plan – carbon markets and related instruments, such as offsetting, will continue to play a significant role in meeting these targets and in climate action.

In early 2021, compliance carbon markets alone were estimated to be worth a total $US 272 billion – a 20% increase over 2019.

However, to keep in line with the Intergovernmental Panel on Climate Change’s recommended 1.5 degrees Celsius of warming, global offsetting must scale fifteen-fold to an annual 2 billion tonnes removed annually by 2030

 
It’s clear carbon markets have an enormous role to play, however. This report is a guide to leveraging them as a financial or market opportunity as well as a crucial tool to decarbonize British Columbia in the post post-Paris Agreement world.

Authors

David Oliver (Lead), CEO and Co-Founder, Greenlines Technology
George P.R. Benson (Supporting), Manager, Economic Transformation, Vancouver Economic Commission
Brianna Bishop (Supporting), Analyst, Economic Transformation, Vancouver Economic Commission

With editorial support from Claire Campbell and Sonu Purhar

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