Emission Trading System - United States

United States

The government income in the Emission Trading System market is projected to reach €678.40m in 2024.
It is expected to show an annual growth rate (CAGR 2024-2029) of 2.93% resulting in a projected total amount of €783.60m by 2029.
From a global comparison perspective it is shown that the highest government income is reached in Germany (€11,670.00m in 2024).
In the Emission Trading System market, the number of contracts is expected to amount to 22 by 2029.

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Analyst Opinion

The Emission Trading System market in United States is experiencing a shift in dynamics driven by various factors.

Customer preferences: Market participants in the United States are increasingly focusing on sustainability and environmental responsibility, leading to a growing interest in emissions trading. Companies are seeking ways to reduce their carbon footprint and comply with regulations, driving the demand for emission allowances and offsets.

Trends in the market: One notable trend in the United States Emission Trading System market is the increasing participation of companies from diverse industries. This broadening of the market is creating more liquidity and transparency, making it more attractive for investors and speculators alike. Additionally, the introduction of new compliance mechanisms and stricter emission targets is shaping the market landscape.

Local special circumstances: The United States has a complex regulatory environment with emissions trading programs operating at both the state and federal levels. This fragmented system can create challenges for market participants, as they navigate different rules and requirements across various jurisdictions. However, this diversity also presents opportunities for innovation and tailored solutions to address specific regional needs.

Underlying macroeconomic factors: The macroeconomic landscape in the United States, including factors such as economic growth, industrial output, and energy consumption, plays a significant role in shaping the Emission Trading System market. Fluctuations in these variables can impact the demand for emission allowances and influence market prices. Additionally, regulatory developments and political decisions at the national level can have a profound effect on market dynamics.

Methodology

Data coverage:

Figures are based on commodity derivatives, their notional value, the number of contracts traded, the open interest (outstanding contracts at the end of a year), and the average value of a contract.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use market research & analysis, and data of World Bank, as well as the World Federation of Exchanges. Furthermore, we use relevant key market indicators and data from country-specific associations and national data bureaus such as GDP, wealth per capita, and the online banking penetration rate. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use the HOLT-damped Trend method to forecast future development. The main drivers are GDP per capita an the online banking penetration rate.

Additional Notes:

The market is updated twice per year in case market dynamics change.