Global carbon markets are entering a new phase of expansion and institutional maturity, according to the ICAP Status Report 2026. Despite geopolitical tensions and volatile energy conditions, emissions trading is spreading faster than ever, with new national carbon pricing programs launching and existing markets tightening their rules.
The report finds that 41 emissions trading systems are now operating worldwide, covering roughly 26% of global greenhouse gas emissions. Three additional national systems are set to launch in 2026 in Japan, India, and Vietnam, underscoring how carbon pricing is moving beyond early adopters into large emerging economies. Together, jurisdictions with active ETS frameworks account for 63% of global GDP and more than half the world’s population.
Momentum is also strengthening inside established markets. China is preparing to shift its national ETS toward an absolute emissions cap by 2027, while the European Union is expanding its system to include transport and buildings. Korea has increased auctioning and introduced new market stability tools, and California has locked in its program through 2045.
Revenue generation is becoming a defining feature. ETS programs raised nearly $80 billion in 2025, funds that governments are increasingly deploying for clean energy investment and household support. Policymakers view these revenues as a key factor in sustaining political backing for carbon pricing over the long term.
The ICAP report also highlights growing international alignment, with more countries integrating emissions trading into their climate commitments under the Paris Agreement and expanding cooperation through new policy dialogue platforms.
Taken together, the developments suggest carbon markets are no longer experimental tools but core infrastructure of climate policy. As Stefano De Clara, Head of the ICAP Secretariat, notes, emissions trading is “becoming the architecture of the global climate response.”
The broader trend is consistent with other recent developments in carbon pricing. The World Bank’s State and Trends of Carbon Pricing 2025 similarly found record expansion in both compliance and voluntary carbon markets, while OECD analysis has emphasized that pricing carbon is increasingly central to net-zero pathways. At the same time, the IMF has argued that the scale of investment needed for decarbonization will require deeper and more coordinated carbon pricing frameworks.
Read more: New ICAP Publication Shows The Current Landscape Of CDR Interaction With ETSs
