www.hestiya.com Carbon Pricing Comes of Age: Inside the Record $79 Billion Emissions Trading Year (2025 Data, ICAP 2026 Report)
Table of Content 1. Executive Summary 2. The Headline Number: A Record Revenue Year 3. A Market Still Expanding in Scope and Reach 4. The Global Pipeline 5. Why 2025 Was Different 6. Regional Deep Dive 7. Compliance Markets vs. the Voluntary Carbon Market 8. Risks and Open Questions 9. Outlook: What to Watch in 2026–2027 10. What This Means Going Forward 11. The Role of Hestiya in a Maturing Carbon Market 1.
1. Executive Summary ~$79B Global ETS revenue, 2025 (record) 41 Emissions trading systems are now in force 26% of the global GHG emissions covered 63% of the global GDP under an ETS jurisdiction How 41 emissions trading systems, wider coverage, and recovering allowance prices pushed global compliance carbon markets to a new high in 2025, and what that means for 2026 and the years just after it. Here's the headline: the world's carbon markets just had their best year ever. Governments running emissions trading systems (ETS for short) collected close to USD 79-80 billion in 2025, the highest number since these markets began. [1] That's according to the International Carbon Action Partnership, or ICAP, a Berlin-based group that has been tracking carbon markets around the world for years. They put out their big annual report, the Emissions Trading Worldwide Status Report 2026, on 14 April 2026, and it covers everything that happened through the end of 2025. [1][7] What makes this number even more interesting is the story behind it. In 2023, ETS revenue hit what was then a record of USD 74 billion. [3] Then in 2024, it actually dropped to around USD 70 billion, mostly because prices in Europe's carbon market fell. [2] So 2025 wasn't just another record year; it was a genuine comeback, recovering the ground that was lost and then pushing past the old high. And the revenue jump isn't happening in isolation. It's part of a much bigger, structural shift. There are now 41 emissions trading systems running around the world, together covering 26% of all global greenhouse gas emissions, up from just 17% back in 2022. [1][5] That's a huge jump in just a few years. Three brand-new national systems are launching in 2026 alone, in Japan, India, and Vietnam, and another 16 are somewhere in the pipeline, being designed, debated, or seriously considered, in places like Brazil, Chile, Colombia, and Türkiye. [1] Put it all together, and jurisdictions that already have an ETS in place now represent 63% of the world's GDP and more than half of everyone on the planet. Fourteen of the G20 countries are already running one. [1] ICAP's own way of putting it is that emissions trading has moved "from niche to mainstream." Governments are increasingly taking the record money raised from carbon auctions and pouring it straight back into clean energy projects and support for households facing higher energy bills. According to ICAP's Secretariat, that reinvestment isn't just good optics, it's actually the thing that keeps carbon pricing politically survivable over the long run, especially when energy prices spike, or economies wobble. [1] 2.
2. The Headline Number: A Record Revenue Year So where does this money actually come from? Most ETS revenue is generated when governments auction off emission allowances, essentially permits that let a company emit one tonne of carbon dioxide. Companies covered by the scheme have to buy or hold enough of these allowances to match what they've actually emitted, and when they don't have enough lying around for free, they have to go buy them at auction. More demand and higher prices simply mean more money flowing into government coffers. The reason 2024 was a weaker year comes down almost entirely to Europe. The price of a European Union Allowance, or EUA, had climbed to nearly €100 per tonne back in 2023, but it slid down to around €67 per tonne in 2024. [2] Since the EU market is by far the biggest compliance carbon market on the planet, that kind of price drop drags down the global total almost single-handedly. The good news is that in 2025, prices firmed back up again across the EU, the UK, and most of the other major systems, and trading volumes picked up too, which is basically why the overall number bounced back so strongly. [1] It's worth pausing on just how dominant Europe still is here. By the end of 2025, the EU ETS alone had raised a cumulative EUR 265.7 billion, roughly USD 297.1 billion, since it first launched back in 2005. [6] That's more than two decades of steady auction revenue. And since June 2023, EU member states haven't had a choice about what to do with that money: they're legally required to put all of it (or an equivalent amount) toward climate action and the broader energy transition. So this isn't money that quietly disappears into general budgets — by law, it has to go back into decarbonisation-related spending. [6] 3. Revenue (USD Billions) Figure 1: Global annual ETS revenue, 2022–2025 (USD billions). Source: ICAP Emissions Trading Worldwide Status Reports, 2023–2026 editions. $63B 2022 2023 2024 2025 $74B $70B $79B 80 60 40 20 0
4. 3. A Market Still Expanding in Scope and Reach Revenue is really only half the story here — the other half is just how much bigger this whole system has gotten. Back in 2022, ICAP counted 25 emissions trading systems in force around the world, together covering about 17% of global greenhouse gas emissions. [5] Fast forward two years to 2024, and that had already climbed to 38 systems covering 23% of emissions. [2][8] And now, at the start of 2026, we're at 41 systems covering 26% of the world's emissions. [1] That's a pretty remarkable pace of growth for something that used to be considered a fairly niche, technocratic policy tool. What's really changed in the last few years is who is driving this growth. It used to be Europe, California, and a handful of other early adopters leading the way. Now it's the large emerging economies doing most of the heavy lifting. Japan is turning its long-running voluntary carbon scheme into a mandatory national system this year. India is rolling out its own Carbon Credit Trading Scheme, built around an intensity- based, baseline-and-credit model designed to fit its energy-heavy industrial base. Vietnam is bringing its pilot market fully into force. [1] Meanwhile, Brazil, Chile, and Colombia have all already passed the legislation they need and are now getting ready to actually implement their systems, and Türkiye is putting the finishing touches on its own pilot programme. [1] In other words, the centre of gravity for carbon pricing is genuinely shifting toward the Global South and fast- growing Asian economies. Number of ETS in force 2022 ETS in force (count) Share of global GHG emissions covered (%) Figure 2: Growth in the number of ETS in force and their share of global GHG emissions, 2022–2026. Source: ICAP Status Reports 2022, 2025, and 2026. 25 17% 23% 26% 38 41 Expansion of Emissions Trading Systems, 2022-2026 2024 2026 50 40 30 20 10 0
4. The Global Pipeline 5. Why 2025 Was Different If you zoom out and look at everything in the works, not just what's already running, the picture gets even bigger. On top of the 41 systems already operating, ICAP is tracking a further 16 jurisdictions where a system is either being actively developed or seriously considered. [1] Add those two numbers together, and you get 57 markets worldwide that are, in one form or another, somewhere on the journey toward a full- fledged carbon market — whether that's the design stage, an early pilot, or full operation. A few different things came together to make 2025 the record-breaker that it was. Here's a simple breakdown of what changed: Ÿ Prices bounced back: after the 2024 slump, allowance prices firmed up again across the EU, the UK, and most other developed-market systems. Even where the number of allowances up for auction stayed roughly the same, higher prices per allowance meant more total revenue. [1] Ÿ More countries got on board: an ETS is now running in 14 of the G20 economies, and quite a few of them have openly said this is going to be one of their main tools for hitting their next round of climate targets (what's called NDC 3.0) under the Paris Agreement. [1] Ÿ Big structural reforms kept the momentum going: China has put out guidelines to move its national ETS from an intensity-based system to a hard, absolute emissions cap by 2027, and plans to keep widening coverage to more heavy industry. Korea has started auctioning off more of its allowances instead of giving them away for free. California has locked in the legal authority to keep its programme running all the way through 2045. And the EU is getting ready to launch a whole second system, known as ETS2, which will bring buildings and road transport into the fold starting in 2028. [1] Figure 3: ETS systems in force versus in development or under consideration, 2026. Source: ICAP Status Report 2026. Global ETS Pipeline, 2026 (57 systems in force, development, or consideration) 16 41 In force (41) In development or under consideration (16) 5.
6. Ÿ Carbon Border Adjustment Mechanisms, or CBAMs, started to bite: the EU's CBAM entered its compliance phase, and the UK is following close behind. This is essentially a carbon tariff on imports, and it's putting real pressure on trading partners to set up their own carbon pricing rather than pay the EU's charge, while also pushing existing systems to rethink how many free allowances they hand out. [2] Snapshot: Global ETS at a Glance Metric 2022 2024 2026 (latest) ETS in force worldwide 25 38 41 Share of global GHG emissions covered 17% 23% 26% Systems in development / under consideration 22 n/a 16 Annual ETS revenue (prior year, USD) $63B (2022) $70B (2024) ~$79B (2025) Sources: ICAP Emissions Trading Worldwide Status Reports 2022 [5], 2023 [4], 2024 [3], 2025 [2], and 2026 [1].
6. Regional Deep Dive Numbers on a page only tell you so much, so it's worth walking through what's actually happening region by region, because the story looks quite different depending on where you are in the world. European Union If there's one market that anchors the whole global carbon pricing system, it's the EU ETS. It's still the biggest and most actively traded carbon market anywhere, whether you measure it by trading volume or by the total money it has raised over time. Since it launched in 2005, it has brought in EUR 265.7 billion — call it USD 297.1 billion — and since June 2023, every euro of that has had to go toward climate action or the energy transition, by law. [6] On the emissions side, things are also moving in the right direction: emissions from the stationary installations covered by the system were sitting about 50% below where they were in 2005 as of the start of 2025, which keeps the EU broadly on pace for its 2030 goal of a 62% cut. [6] The next big change on the horizon is ETS2, a brand-new, separate system that will bring buildings, road transport, and smaller industrial players into the carbon-pricing net, with obligations starting to kick in from around 2027- 2028. [1] China China plays a completely different game. Its national ETS is the largest carbon market in the world if you go by how many emissions it actually covers — but the price per tonne is still nowhere near what you'd see in Europe. What's changing now is scope and structure. Being has already expanded the system beyond power generation to include steel, cement, and aluminium smelting, adding roughly 3 gigatonnes of CO2- equivalent to what's covered — about 5% of the entire planet's greenhouse gas emissions in one move. [2] And now China has issued new guidelines to shift the whole system from an intensity-based benchmark (where the limit scales with how much you produce) to a flat, absolute cap by 2027. That's a meaningful tightening, and it would bring China's approach a lot closer to how the EU's system is designed. [1] 7.
8. North America Things in North America have been a lot quieter, in a good way — steady, if a little scattered. California's cap-and-trade programme and the Regional Greenhouse Gas Initiative (RGGI) on the East Coast both kept running smoothly through 2024 and 2025, and California recently locked in the legal backing to keep its programme going all the way to 2045, which gives businesses there a lot of long-term certainty. [1] Up in Canada, the federal Output-Based Pricing System and the provincial programmes in Québec (linked to California's market since 2014) and Saskatchewan also stayed on an even keel. Meanwhile, new proposals are slowly working their way through the system in states like New York and Colorado. [2] All told, it's less a single unified market and more a patchwork of separate but broadly compatible systems. Emerging markets If you want to know where carbon pricing is actually growing fastest right now, look past the traditional early movers and toward the emerging world. Japan is converting its long-running voluntary GX-ETS into a mandatory, nationwide system in 2026. India's new Carbon Credit Trading Scheme uses an intensity-based, baseline-and-credit design built specifically around its energy-intensive industries. Vietnam is bringing its pilot market online, Indonesia is trying something different altogether with a hybrid "cap-tax-and-trade" model, and Brazil, Chile, Colombia, and Türkiye are all somewhere between passing legislation and launching a pilot. [1][8] ICAP has noticed that these newer systems lean much more heavily on offsetting and domestic crediting mechanisms than the earlier generation of carbon markets did — which is quietly blurring the once-clear line between mandatory compliance markets and the voluntary carbon credit world. [2]
9. 7. Compliance Markets vs. the Voluntary Carbon Market It's easy to mix these two things up, so it's worth being really clear about the difference. The USD 79 billion figure from ICAP comes entirely from compliance markets, government-run systems that companies are legally required to take part in. That's a very different animal from what's called the voluntary carbon market, or VCM, where companies choose, entirely on their own, to buy carbon credits or renewable energy certificates because they've made an ESG or net-zero promise, not because a law is forcing them to. Ÿ Compliance markets (ETS): run by governments, with a hard emissions cap, mandatory participation for regulated companies, allowances traded at prices the market sets through exchanges, and revenue that flows straight into public budgets or dedicated climate funds. Ÿ Voluntary markets: no government cap at all. Companies and individuals simply choose to buy verified credits, from bodies like Verra or Gold Standard — or International RECs (I-RECs), either to offset their own emissions or to back up a renewable-energy claim, usually alongside whatever internal reduction targets they've already set for themselves. [9] As compliance systems get stricter, handing out fewer free allowances and pulling more sectors under their umbrella, a lot of companies are turning to the voluntary market and I-RECs to plug the gaps: covering emissions that compliance schemes don't yet reach, or simply getting ahead of regulations they can see coming down the road. This is exactly the space where specialised marketplaces and data platforms are starting to play a bigger role, sitting right alongside the compliance infrastructure described above.
8. Risks and Open Questions 10. None of this growth is happening without friction, and it's worth being honest about where the soft spots are: Ÿ Fragmentation: as more countries design their own custom-built ETS, some blending cap-and-trade with carbon taxes and offset credits all in one system, it gets harder to compare markets or link them together. That raises the risk of carbon leakage (companies simply relocating to where climate rules are weaker) and creates duplicated compliance headaches for companies operating across borders. [1] Ÿ Price volatility: 2024's dip is a good reminder that government revenue, and market confidence generally, can swing quite a bit based on allowance prices — and those prices are themselves at the mercy of energy costs, industrial demand, and the timing of policy reforms, like the EU's RePowerEU allowance releases. [2] Ÿ Trust issues in the voluntary market: unlike government-run ETS, voluntary carbon credits have repeatedly come under fire over questions like additionality (would this reduction have happened anyway?), double counting, and how rigorous the verification really is. That's a big part of why buyers are increasingly gravitating toward marketplaces that use blockchain-based tracking, tie directly into registries for verification, and let you retire a credit instantly. [9][10] Ÿ Staying power politically: ICAP is pretty blunt about this one, putting auction revenue toward things people can actually see and feel, like household energy support or local industrial investment, is what keeps carbon pricing politically survivable the next time there's an economic shock. [1]
11. 9. Outlook: What to Watch in 2026–2027 Looking ahead, here's what's worth keeping an eye on over the next year or two: Ÿ Whether Japan, India, and Vietnam actually manage to launch their new systems on schedule in 2026, and at what price levels they open at. Ÿ How far China gets with its planned move to an absolute emissions cap by 2027, and what that does to the overall global supply of allowances. Ÿ How the EU's ETS2 rollout for buildings and road transport actually lands with the public, given how politically sensitive higher fuel and heating costs can be for ordinary households. Ÿ Whether more countries beyond the EU and UK start rolling out their own CBAMs, which could speed up carbon-pricing adoption among trading partners trying to dodge the border charge. Ÿ Whether compliance markets and voluntary instruments, carbon credits, and I-RECs keep converging, as more companies use both together to hedge against tightening rules.
10. What This Means Going Forward 12. If you read between the lines of ICAP's own commentary, they're describing something quite deliberate rather than accidental. After roughly a decade and a half of trial and error, governments are now building new carbon markets with hard-won lessons baked in from the start — anchoring them in broader climate laws and net-zero targets so a change in government doesn't automatically kill the programme. Recycling auction revenue back into clean energy projects and support for households facing higher costs keeps coming up again and again as the one thing that seems to matter most for keeping public and political support alive, especially through shocks like the 2022 energy crisis or 2024's price correction. [1] At the same time, ICAP is candid about the risk that comes with all this growth: as more jurisdictions build their own, slightly different versions of an ETS, some blending cap-and-trade with carbon taxes and offset crediting, the whole system risks becoming fragmented. That's exactly why the report leans so heavily on the idea of deeper international cooperation, including brand-new cross-jurisdictional dialogue platforms, as a necessary companion to whatever any one country decides to do on its own. For companies operating in more than one of these covered jurisdictions, the direction of travel is pretty clear: more sectors coming under the net (aviation, shipping, and eventually buildings and road transport in the EU), tighter caps, and less free allocation. All of that pushes up the real cost of carbon over time, and it makes good emissions data, solid MRV (monitoring, reporting, and verification) processes, and an early foothold in voluntary markets and I-REC or carbon- credit instruments genuinely valuable, not just nice- to-haves, but things that can meaningfully offset a growing compliance bill.
11. The Role of Hestiya in a Maturing Carbon Market 13. As compliance markets get bigger and stricter, and voluntary demand keeps growing right alongside them, most companies aren't really wrestling with whether to engage with carbon pricing anymore — that decision has largely been made for them. The real question is how to actually go out and buy credible, fairly priced climate instruments without running into all the friction that has historically made this market slow and clunky to work with. That's the gap that climate-asset marketplaces like Hestiya are trying to close. Hestiya runs a blockchain-based marketplace for verified carbon credits and I-RECs, built around letting buyers trade directly, peer-to-peer, with verified project suppliers rather than going through a chain of middlemen. Because every transaction happens on- chain, on the Polygon network, the platform is designed to make each trade fully traceable and impossible to quietly alter after the fact, which goes straight at two of the biggest complaints people have historically had about the voluntary carbon market: double-counting and murky, hard-to-verify origins. [9][10] Every credit or I-REC listed on the platform is pre-verified against recognised frameworks, and Hestiya says it aligns its work with standards bodies including Verra, Gold Standard, and Evident, as well as with Article 6.4 of the Paris Agreement's crediting mechanism. [11] In practical terms, here's what Hestiya's approach actually changes for a buyer, compared to how this market has traditionally worked: Ÿ Buying directly, without middlemen: businesses deal straight with verified suppliers instead of going through layer after layer of brokers, which the platform says helps cut down transaction costs compared to a typical over-the-counter carbon deal. [10] Ÿ instead of the usual Live pricing, instant trades: back-and-forth negotiation and opaque pricing, buyers can see real, live market rates and simply execute a purchase on the spot — genuinely useful if you're racing to true up your emissions numbers or renewable-energy claims before a reporting deadline. [10] Ÿ once you buy a credit, it Retiring credits instantly: can be retired straight away, on-chain, giving you a timestamped, verifiable record you can actually point to in an ESG disclosure or sustainability report. [10]
14. Ÿ smaller companies get No minimum purchase size: to play too, not just the big multinationals — which matters more and more as ESG and net-zero commitments start showing up further down the size spectrum, including in emerging markets like India, Nepal, and Brazil. [11] Ÿ through a product Market intelligence built in: called Hestiya Intelligence, the platform also offers pricing and market data specifically for I-RECs, so corporate buyers and renewable-energy developers can benchmark a deal against real, registry-sourced transaction data instead of relying on stale or indicative price lists. [9] It's probably most useful to think of Hestiya not as competing with government-run ETS, those remain mandatory, government-priced, and closed off to voluntary participants by design, but as complementary infrastructure sitting around the fast- growing space next door: companies covering emissions that fall outside compliance schemes, backing up renewable-energy claims, or simply getting ahead of rules they can see coming as coverage keeps expanding into new sectors and new countries. As more national ETS come online in markets like India, Vietnam, and Brazil, and as demand for verified I-RECs keeps climbing right alongside them, transparent, blockchain-verified marketplaces of this kind look set to play a growing role in connecting emerging-market renewable and carbon projects with the global corporate buyers who need credible, audit-ready climate assets. International Carbon Action Partnership (ICAP). "Emissions Trading Worldwide: ICAP Status Report 2026." Published 14 April 2026. https://icapcarbonaction.com/en/publications/emissions-trading-worldwide- icap-status-report-2026 2. International Carbon Action Partnership (ICAP). "Emissions Trading Worldwide: ICAP Status Report 2025." 2025. https://icapcarbonaction.com/en/publications/emissions-trading-worldwide- icap-status-report-2025 3. International Carbon Action Partnership (ICAP). "Emissions Trading Worldwide: 2024 ICAP Status Report." 2024. https://icapcarbonaction.com/en/publications/emissions-trading-worldwide- 2024-icap-status-report 4. International Carbon Action Partnership (ICAP). "Emissions Trading Worldwide: 2023 ICAP Status Report" (PDF). 2023. https://icapcarbonaction.com/system/files/document/ICAP%20Emissions%2 0Trading%20Worldwide%202023%20Status%20Report_0.pdf 5. International Carbon Action Partnership (ICAP). "Emissions Trading Worldwide: 2022 ICAP Status Report." 2022. https://icapcarbonaction.com/en/publications/emissions-trading-worldwide- 2022-icap-status-report 6. ICAP ETS Map — "EU Emissions Trading System (EU ETS)" factsheet, updated 2026. https://icapcarbonaction.com/en/ets/eu-emissions-trading-system-eu- ets 7. Reuters (Susanna Twidale), via WTVB/AP wire. "Global carbon markets hit record $79 billion revenue in 2025, ICAP says." 14 April 2026. https://wtvbam.com/2026/04/14/global-carbon-markets-hit-record-79- billion-revenue-in-2025-icap-says/ 8. ESG News. "ICAP 2025 Report: Global Emissions Trading Systems Rise To 38, Covering 23% Of Emissions." 2026. https://esgnews.com/icap-2025-report- global-emissions-trading-systems-rise-to-38-covering-23-of-emissions/ 9. Hestiya. Company website and product pages (includes Hestiya Intelligence at hestiya.com/intelligence). https://www.hestiya.com/ 10. The Tribune (syndicated release, also carried by Business Standard and ThePrint). "Hestiya Redefines Carbon Credit and I-REC Buying with Blockchain- Powered Marketplace." April 2025. https://www.tribuneindia.com/news/business/hestiya-redefines-carbon- credit-and-i-rec-buying-with-blockchain-powered-marketplace/ 11. Outlook India. "Hestiya Launches Global Platform For I-RECs And Carbon Credits." 2025. https://www.outlookindia.com/hub4business/hestiya- launches-global-platform-for-i-recs-and-carbon-credits References