Decarbonization Market Size, Share & Industry Analysis, By Service (Carbon Accounting & Reporting Services, Waste Reduction & Circular Economy Services, and Sustainable Transportation Services), By Technology (Renewable Energy Technologies, Energy Efficiency Solutions, Electric Vehicles (EVs) & Transportation, Grid Technology, Nuclear, and Others), By End-Use Industry (Automotive & Transportation, Agriculture, Energy & Utility, Buildings, Industry, and Others), and Regional Forecast, 2024-2032

The global decarbonization market size was valued at USD 1,940.23 billion in 2023. The market is projected to grow from USD 2,061.35 billion in 2024 to USD 5,515.54 billion by 2032, exhibiting a CAGR of 13.09% during the forecast period.

Decarbonization service is used to remove or reduce the carbon dioxide produced from multiple sources, such as solar energy and wind energy. Decarbonization is done by switching from fossil fuels to renewable and clean energy systems, such as wind, solar, and EV. In recent years, multiple government bodies have been focusing on the energy transition owing to the emission of CO2, which is responsible for climate change and needs to be controlled as early as possible.

The major regions, such as Asia Pacific and Europe, are actively taking initiatives to reduce carbon as these regions are emitting more greenhouse gases in their countries. Sectors, such as industry, agriculture, and residential are the major contributors to the emission of these gases.  Moreover, rising awareness regarding climate change is driving the market, and it will grow in the coming years.

The global market was affected by the COVID-19 pandemic as several sectors faced a decline in numbers due to the spread of the virus. The service provider also faced several issues during the lockdown. The market requires heavy investments and installation of the equipment. Factors, such as unavailability of raw materials, shutdown of manufacturing plants, and closure of the borders impacted the market growth. In addition, the pause in the industrial sector impacted the global market.

Decarbonization Market Trends

Growing Focus on Climate Change Activities is Backing the Market

Decarbonization is a serious objective in the fight against climate change as greenhouse gas emissions are warming the global climate, causing thrilling weather, and depleting natural resources and biodiversity. To reduce carbon emissions, companies are focusing on decarbonization activities, such as renewable energy, electric vehicles, and grid technology can positively focus on the climate change goals.

As an awareness, many businesses are investing billions and trillions of USD in renewable and clean energy sources to control carbon emissions. For Instance, in 2024, the U.S. and the European Union introduced new industrial policies for the expansion of electric vehicles with an investment of USD 275 billion. It will boost sureness in the electrification of road transport, hence directly affecting the market.

Decarbonization Market Growth Factors

Major Growth in Renewable Energy Practices is Fueling the Market Growth

Renewable energy sources play a major role as they are proven to be the most effective means of limiting air pollution and greenhouse gas emissions. The growing practices of renewable sources, such as solar and wind energy, are driving the global market. The move toward renewable energy is driven not only by environmental necessities but also by the sector's cumulative economic competitiveness. The renewable sector holds the maximum share in decarbonization activities, backing up market growth. 

For Instance, in 2024, as per the data of the Energy Institute in “Statistical Review of World Energy 2024”, renewable energy hit the record for most consumption. The review delivers a comprehensive image of supply and demand for major energy sources on a country-level basis.

Rising Investments in Energy Transition are driving the Demand for Decarbonization Activities

Energy transition is one of the major factors associated with decarbonization practices. Hence, rising investments in the energy transition are driving market growth. Electrification, renewables, and grid technologies are the major pillars of the energy transition market, and they drive decarbonization activities by deploying clean sources. Climate change has become a universal problem nowadays, and hence, many government and private businesses are focusing on decarbonization activities.

For Instance, in 2024, as per the data of the International Energy Agency, worldwide investment in the energy transition hit a record USD 1.8 trillion in 2023. Moreover, electrified transport was the major driver of spending on clean technologies, and renewable energy accounted for more than a third of the investment total.

RESTRAINING FACTORS

Challenging Sectorial Development in Decarbonization Practices is Hindering Market Growth

The sectorial decarbonization practices are becoming challenging owing to the embedded sustainability and decarbonization in the business strategy. Many businesses are not aware of the business strategies associated with decarbonization practices, hence stifling market growth. Transportation is one of the sectors that is diversified with multiple fuel options and hence becomes challenging to control. These practices are time-consuming and hinder the decarbonization market share.

Decarbonization Market Segmentation Analysis

By Service Analysis

Huge Availability of Transport Services Boosts Sustainable Transportation Services Segment Growth

By service, the market is segmented into carbon accounting & reporting services, waste reduction & circular economy services, and sustainable transportation services.

Sustainable transportation services are the dominating segment globally owing to the huge availability of transport services globally. This has driven the decarbonization market growth in recent years. For Instance, in 2024, Nirmala Sitharaman (union finance minister of India) presented the Interim budget from the current Indian government that will seek to focus on e-bus in India. Moreover, urban bus transport got 3% of the funds allocated to Metro and high-speed rail combined.

Waste reduction & circular economy services are one of the fastest-growing segments in the market, driven by the growing global investment in waste management.  Carbon accounting & reporting services are also contributing an ample amount of its share to the global market owing to the growing awareness regarding carbon capture services.

By Technology Analysis

Growing Investments in Solar and Wind Farms Boosts Demand for Renewable Energy Technologies

By technology, the market is segmented into renewable energy technologies, energy efficiency solutions, Electric Vehicles (EVs) & transportation, grid technology, nuclear, and others. Renewable energy technologies are considered the dominating segment globally, driven by the growing investments in solar and wind farms. Solar energy is a dominating source that contributes to the market.          

Electric vehicles (EVs) & transportation is one of the fastest-growing segments driven by the growth in the sales of electric vehicles in recent years. For instance, in 2024, as per the data by the International Energy Agency, electric vehicle sales in 2023 were 3.5 million higher than in 2022, and there was over 35% year-on-year upsurge. U.S. and Europe from China followed the major contribution.

Energy efficiency solutions and grid technology also contribute to the global market. The rise in the demand for efficient lighting and well-insulated home products is helping to drive the growth of the market. Grid technology is one of the most considerable systems in the many business areas for energy saving, which includes plants and warehouses, backing the market growth.

By End-Use Industry Analysis

Growing Demand for Electric Vehicles Fuels Automotive & Transportation Segment Growth

By end-use industry, the market is categorized into automotive & transportation, agriculture, energy & utility, buildings, industry, and others. Automotive & transportation is considered the dominating segment backed by the growing demand for electric vehicles globally. Rising transportation services are also driving the global market.

Energy & utility is the fastest growing segment driven by the heavy investments in the energy & utility sector. For instance, in 2024, the government-owned power transmission utility Power Grid Corporation of India agreed to invest in two projects totaling USD 79 million. Such investments in the sector will boost the market in recent years. The industrial sector is also one of the major contributors to the market, and the implementation of energy transition technologies in the manufacturing, plants, processes, and other practices backs it.

REGIONAL INSIGHTS

The market is studied geographically across North America, Europe, Asia Pacific, Latin America, and Middle East & Africa. 

The Asia Pacific region accounted for a major share of the market owing to the rising investments in renewable and clean energy. In addition, rising greenhouse gas emissions are powering massive demand for decarbonization practices in Japan, China, and others. It is expected that the market will grow rapidly in the coming years as decarbonization will be one of the essential parts of the energy transition. For instance, in 2024, as per the data of the International Energy Agency (IEA), China is the major contributor by far and the largest market holder for energy transition, reaching over USD 676 billion in 2023, which is approximately 38% of the total global energy transition.

Europe is the fastest-growing region globally. Emerging countries, such as the U.K. and Germany, are more focused on the installation of renewable sources, which is driving the market in Europe. In addition, the rising adoption of EVs in the countries is also backing the growth of the market.

North America is more focused on greenhouse gas emissions by implementing climate policies in countries. The U.S. is more actively participating in the zero carbon emission targets. This is one of the major factors that make North America grow rapidly. For instance, Grosvenor manages and invests in improving property firms, such as Brentwood Block in Burnaby, which is an 8-acre, pedestrian-focused project that will bring 3,500 carbon-free homes to Metro Vancouver next to rapid transit.

Latin American countries are slowly but majorly focusing on clean energy sources, hence helping the decarbonization market to grow in recent years. The Middle East & Africa are expected to grow in forecast years as many residential and commercial projects focusing on renewable sources to deploy to compete with carbon emissions.

KEY INDUSTRY PLAYERS

Leading Players are working on Advanced Products to Create a Sustainable Future in Industrial Sector

The decarbonization market is focused on investments and a strong product portfolio by leading market key players such as Deloitte, Siemens, and IBM. Siemens is one of the leading global players delivering decarbonization services. Siemens has been bringing electrification products for over an era and provides quality services to multiple sectors.

LIST OF TOP DECARBONIZATION COMPANIES:

• Deloitte (U.K.)


• Accenture (Ireland)


• Siemens (Germany)


• IBM (U.S.)


• Dakota Software (U.S.)


• EnergyCap (U.S.)


• Air Liquide (France)


• Nippon Yusen Kabushiki Kaisha (NYK) (Japan)


• ZF Friedrichshafen (Germany)


• ReNew (India)

KEY INDUSTRY DEVELOPMENTS:

• August 2024: Air Liquide, the leader in gas technology, strategized to invest up to USD 850 million to build and operate four Large Modular Air parting units as well as connected infrastructure in the framework of a long-term binding contract with ExxonMobil for its planned low-carbon hydrogen project in Baytown, TX.


• August 2024: World Business Council for Sustainable Development (WBCSD) Center for Decarbonization Demand Acceleration (CDDA), and ITA Launch Green Purchase Toolkit at Conference of the Parties (COP29). It provides guidance to help industries procure low-carbon products and support the decarbonization of heavy industry.


• August 2024: Nippon Yusen Kabushiki Kaisha (NYK) presented its decarbonization strategy at an international forum reinforced by the organizing ministry for Maritime and Investment Affairs of the Republic of Indonesia.                                 


• April 2024: ZF, the largest supplier to the commercial vehicles industry, announced that it will present its innovations in the field of decarbonization, chassis, safety, and digitalization at its “Global Technology Day.” The group is also announcing a new hybrid transmission system for commercial vehicles.


• April 2024: ABB and Captimise, specialists in Carbon Capture, are spreading their collaboration to drive the acceptance of cost-effective Carbon Capture, Utilization, and Storage (CCUS) technologies in the cement industry. Companies are planning to set a path for decarbonization in the industry.

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading end-use industries. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to the growth of the market in recent years.

Report Scope & Segmentation