Global carbon markets hit record $79 bln revenue in 2025, ICAP says

• The European Union's ETS accounted for the majority of revenues at $48.9 billion in 2025
• 41 emissions trading systems are currently operational, including 16 national programs in countries like Australia, China, Mexico, and the UK
• Three new national systems (Japan, India, and Vietnam) are launching in 2026, with 16 additional systems under development globally

Global Carbon Markets Hit Record $79 Billion Revenue in 2025

Key Findings

Global emissions trading systems (ETS) generated record revenues of $79 billion in 2025, up from approximately $70 billion in 2024, according to the International Carbon Action Partnership's annual Emissions Trading Worldwide Status Report released Tuesday.

Market Structure and Coverage

Currently, 41 emissions trading systems operate worldwide, covering 26% of global greenhouse gas emissions. Sixteen countries have implemented national ETS programs, including Australia, China, Mexico, and the United Kingdom. The European Union's ETS dominated revenue generation, accounting for $48.9 billion of the total.

Growth Drivers

The revenue increase was primarily driven by higher average carbon prices across global markets. Under ETS frameworks, governments set caps on CO2 emissions for specific sectors, with caps typically decreasing annually to ensure emissions reductions over time. Countries generate revenues by auctioning carbon permits to covered entities.

Expansion Outlook

The market is poised for significant expansion, with three new national systems launching in 2026:

• Japan
• India
• Vietnam

An additional 16 systems are currently in various stages of development globally.

Market Implications

The robust revenue growth and expanding adoption signal strengthening carbon pricing mechanisms worldwide as governments pursue climate targets. The near-doubling of coverage with new entrants in major Asian economies could significantly impact industrial operations, energy pricing, and investment flows in carbon-intensive sectors. Investors should monitor carbon price trends and regulatory developments, particularly in emerging markets launching new systems.