Decarbonization Services Market is in trends by increasing focus on sustainability

The decarbonization services market involves various products and services aimed at reducing carbon footprint and achieving climate neutrality for organizations. These include carbon accounting and reporting, carbon offsetting through renewable energy projects, energy audits and retrofits, emissions trading and renewable heating. These services help companies identify areas with high emissions, recommend technologies to lower carbon output and provide certification of meeting climate targets. The global decarbonization service market is estimated to be valued at US$ 69.73 Bn in 2024 and is expected to exhibit a CAGR of 12.% over the forecast period 2023 to 2030.

Key Takeaways
Key players operating in the decarbonization services market are Schneider Electric, ENGIE, Siemens, AECOM, EDF, Johnson Controls, DNV, Honeywell International Inc., Carbon Clean Solutions Limited, The ERM International Group Limited, CarbonCure Technologies Inc., Ørsted A/S, and ABB. With stringent laws and growing customer demand for sustainability, key players are investing in new technologies and expanding service offerings globally.

The rising awareness about climate change is compelling both private and public organizations to commit to net zero emissions targets. This is driving significant demand for decarbonization services that can help assess carbon footprints, implement renewable projects and certify adherence to targets. Companies are increasingly viewing sustainability as a business opportunity and looking to decarbonization services for competitive edge.

Major players are also focusing on strategic partnerships and acquisitions to strengthen their presence across international markets. With nations globally aiming for carbon neutral economies, the decarbonization services market is expected to witness strong growth over the next decade especially in regions like Europe, North America and Asia Pacific.

Market key trends
One of the major trends in the decarbonization services market is the transition to nature-based carbon removal solutions. With scope for deeper cuts limited in some heavy industries, players are focusing on scaling up carbon offset projects involving afforestation, carbon capture through direct air capture technologies, soil carbon sequestration etc. These provide a means to counterbalance residual emissions and achieve ambitious net-zero goals.

Porter’s Analysis
Threat of new entrants: Decarbonization services require high initial investments and specialized technical expertise which pose significant barrier for new players.

Bargaining power of buyers: The bargaining power of buyers is moderate as decarbonization services can help companies achieve carbon reduction targets and gain competitive advantage.

Bargaining power of suppliers: Suppliers have moderate bargaining power since it requires technical know-how and partnerships to deliver decarbonization services.

Threat of new substitutes: Alternatives like renewable energy and energy efficiency currently do not provide a substitute but complement decarbonization services overall.

Competitive rivalry: The market has few specialized global players while regional players compete on cost and local expertise which leads to moderate competitive rivalry.

Geographical Regions
Currently, Europe accounts for the largest share of decarbonization service market value owing to stringent carbon regulations and climate commitments in countries like Germany, UK, and France. The rapid pace of economic development and rising commitment towards net-zero emissions are driving demand in Asia Pacific region especially in China and India.

The fastest growing region for decarbonization services is expected to be Asia Pacific between 2023-2030. This is because of massive investment plans by China, India and other developing nations in renewable energy, green infrastructure and carbon removal projects to meet commitments under Paris agreement. The growing industrial and economic activities will further boost the need for decarbonizing strategies and transition advisor services in the region.

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1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it