The United Kingdom (UK) generates £1.2 billion (over $1.6 billion) annually from carbon credit markets and supports more than 11,000 jobs across the sector, but the country’s advantage could erode without clear government action, according to a recent assessment by the City of London Corporation.
The report, titled “Seizing the UK’s Carbon Credit Opportunity: Measuring Value to Enable Action” and prepared in collaboration with the UK Carbon Markets Forum, is considered the first comprehensive quantified assessment of the UK’s carbon credit economy.
It projects that the global carbon credit market could expand from its current value of $1.4 billion to between $15.8 billion and $267.9 billion by 2050.
This potential 190-fold increase would be driven by demand from artificial intelligence (AI) data centers, aviation compliance under CORSIA Phase 2, Article 6 trading under the Paris Agreement, corporate net zero commitments, and integration with compliance markets including the UK and EU emissions trading schemes.
The UK already occupies a dominant position across the ecosystem, the report noted. London-based Intercontinental Exchange (ICE) traded $1.4 trillion in carbon value in 2025, and the UK is home to two of the world’s top five carbon ratings agencies—Sylvera and BeZero Carbon—which have collectively raised more than $200 million.
The country leads globally in carbon insurance, with over £380 million ($515 million) in insured carbon value in 2025, and ranks second worldwide for engineered carbon removal investment, attracting $2.5 billion between 2023 and 2025.
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The report stresses that benefits extend well beyond London, with woodland and peatland projects linked to carbon credits now protecting more than 100,000 hectares (nearly 250,000 acres), generating an estimated £500 million ($677 million) annually in ecosystem services.
“Carbon markets are a significant and growing part of the UK’s financial services offer,” said Chris Hayward, Policy Chairman of the City of London Corporation. “As AI accelerates global demand for carbon credits, the City of London is well-positioned to be the home of that market. But that position is not guaranteed.”
Ultimately, the report calls on the government to support carbon market use, define quality thresholds, protect corporate claims, build global capacity, develop a greenhouse gas removals strategy, and introduce nature investment incentives—spanning responsibilities across at least four government departments.
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