Portugal Carbon Credit Trading Market Size, Share, Trends and Forecast by Type, Project Type, Trading Type, Buyer Type, End Use Industry, and Region, 2026-2034

Portugal Carbon Credit Trading Market Summary:

The Portugal carbon credit trading market size reached USD 30.9 Million in 2025. The market is projected to reach USD 47.99 Million by 2034, growing at a CAGR of 5.01% during 2026-2034. The market is driven by the establishment of comprehensive regulatory frameworks governing voluntary carbon markets through Decree-Law No. 4/2024, the expansion of the EU Emissions Trading System to include maritime transport and enhanced compliance requirements, and the integration of advanced technologies including artificial intelligence (AI) and blockchain for improved transparency and verification. Additionally, Portugal's commitment to carbon neutrality and strategic investments in carbon capture and utilization infrastructure are expanding the Portugal carbon credit trading market share.

Key Takeaways:

• The Portugal carbon credit trading market was valued at USD 30.9 Million in 2025.
• It is projected to reach USD 47.99 Million by 2034, representing a compound annual growth rate (CAGR) of 5.01% between 2026-2034.
• Portugal's carbon credit market is experiencing transformative growth driven by the implementation of Decree-Law No. 4/2024 in January 2024, which established the nation's first comprehensive voluntary carbon market framework. This regulatory foundation prioritizes nature-based solutions with emphasis on blue carbon and forestry projects while incorporating rigorous verification standards aligned with EU principles.
• Segmentation highlights:
  • Type: Voluntary Carbon Market (VCM), Compliance Carbon Market (CCM)
  • Project Type: Renewable Energy, Energy Efficiency Projects, Forestry and Land Use, Waste Management, Industrial Process Emission Reduction, Carbon Capture, Utilization, and Storage (CCUS), Others
  • Trading Type: Spot Trading, Futures Trading, Options and Derivatives
  • Buyer Type: Compliance Buyers, Voluntary Buyers, Traders and Intermediaries
  • End Use Industry: Energy and Power, Manufacturing and Heavy Industries, Oil and Gas, Transportation, Agriculture and Forestry, Waste Management, Others
• Regional Insights: The report covers major zones within Portugal: Norte, Centro, A. M. Lisboa, Alentejo, and Others.

Portugal Carbon Credit Trading Market Outlook (2026-2034):

The Portugal carbon credit trading market is positioned for steady expansion driven by the convergence of regulatory maturation, technological advancement, and strategic climate commitments. The operationalization of the national voluntary carbon market platform in the second half of 2025 will provide critical infrastructure for transparent credit registration and trading. Furthermore, Portugal's EUR 1 billion state aid scheme approved by the European Commission to support climate neutrality technologies, including carbon capture equipment, signals substantial government backing for market development. The integration of digital MRV systems, AI-powered verification, and blockchain-based tracking platforms will enhance credit integrity and reduce transaction costs, attracting increased corporate participation from both compliance and voluntary segments throughout the forecast period.

Impact of AI:

Artificial intelligence is revolutionizing Portugal's carbon credit trading market by enabling precise emissions monitoring through satellite imagery analysis, IoT sensor data integration, and predictive risk assessment for carbon sequestration projects. AI-driven MRV systems significantly reduce verification costs and timeframes while improving accuracy in measuring carbon reductions across diverse project types from forestry to industrial emissions. Machine learning (ML) algorithms optimize credit pricing, facilitate intelligent matching between buyers and sellers, and detect potential fraud or double-counting in real-time. When combined with blockchain technology, AI creates tamper-proof verification systems that enhance market credibility and attract institutional investors, positioning Portugal's carbon market as technologically advanced within the European landscape.

Market Dynamics:

Key Market Trends & Growth Drivers:

Regulatory Framework Development Accelerating Market Formalization

Portugal's establishment of a comprehensive voluntary carbon market through Decree-Law No. 4/2024 represents a watershed moment for the nation's climate action infrastructure. Entering into force on January 6, 2024, this legislation creates a robust regulatory framework governing greenhouse gas emission reduction and carbon sequestration projects developed on national territory. The decree defines two distinct credit categories, standard carbon credits and carbon credits plus for projects incorporating biodiversity and natural capital benefits, while establishing clear methodologies for each project type including forestry and blue carbon initiatives. The framework mandates independent verification bodies, implements stringent monitoring and reporting requirements, and establishes a public registration platform where all projects, credits, and transactions will be recorded. Critically, the legislation incorporates fundamental EU principles regarding additionality, permanence, and transparency to prevent greenwashing, positioning Portugal ahead of many European nations in voluntary market development. The creation of a technical monitoring committee to develop sector-specific methodologies, combined with insurance mechanisms to cover reversal risks from natural phenomena, demonstrates sophisticated risk management. This regulatory certainty attracts both project developers and credit purchasers by providing clear rules of engagement and credible verification standards that align with emerging EU-wide carbon removal certification frameworks.

EU ETS Expansion and Compliance Requirements

The European Union's ambitious expansion and reform of its Emissions Trading System is creating substantial demand for carbon credits across Portugal's economy. In 2024, the EU ETS underwent transformative changes including scope expansion to maritime transport, which now covers 100% of emissions between EU ports and 50% of emissions from international voyages. Portugal's participation in the EU ETS, which achieved a significant reduction in covered emissions during previous phases, demonstrates both the system's effectiveness and the nation's capacity for carbon management. The introduction of ETS2 covering buildings and road transport from 2027 will further expand compliance obligations across Portuguese industries. As free allocation of allowances phases out, aviation receiving zero free allocations from 2026, companies face growing financial incentives to engage in carbon credit markets for cost-effective compliance. This regulatory pressure, combined with corporate net-zero commitments that exceed legal requirements, is driving Portuguese entities toward both compliance and voluntary carbon markets as essential tools for achieving climate targets while maintaining operational flexibility.

Technology Integration Enhancing Market Transparency and Efficiency

Advanced digital technologies are fundamentally transforming how carbon credits are verified, traded, and monitored in Portugal's emerging market. The integration of artificial intelligence with satellite remote sensing, IoT sensors, and blockchain infrastructure creates unprecedented accuracy in emissions measurement and verification. Digital MRV systems reduce traditional verification costs and timeframes while eliminating human error in carbon accounting across diverse project types. In 2025, Veolia's announcement of feasibility studies for a carbon capture unit at LIPOR's Energy Recovery Plant in Greater Porto exemplifies this technological convergence, the proposed system could reduce the waste-to-energy plant's CO₂ emissions by over 90% while capturing biogenic CO₂ annually for conversion into sustainable aviation fuels. This Power-to-Liquid facility demonstrates how carbon capture and utilization technology can transform industrial emissions into valuable products, creating economic incentives beyond regulatory compliance. Portugal carbon credit trading market growth is further accelerated by blockchain-based platforms that provide immutable transaction records, preventing double-counting and enhancing credit traceability from issuance through retirement. AI-powered analytics optimize credit pricing, match buyers with appropriate projects, and assess long-term permanence risks including climate hazards affecting nature-based solutions. As Portugal's national registry platform becomes operational in late 2025, these technological capabilities will be embedded in the market infrastructure, positioning Portugal as a European leader in digitally-enabled carbon trading with high-integrity standards that attract institutional investors and corporate buyers seeking verifiable emissions reductions.

Key Market Challenges:

Greenwashing Concerns and Verification Quality Issues

The Portugal carbon credit trading market faces significant credibility challenges stemming from widespread greenwashing concerns that have plagued voluntary carbon markets globally. Inflated baseline scenarios, questionable additionality claims, and insufficient permanence guarantees for nature-based projects create skepticism among corporate buyers and institutional investors. Major corporations have publicly resisted purchasing voluntary carbon credits due to reputational risks associated with low-quality offsets, while investigative journalism has exposed projects with weak evidence of actual deforestation risk or emissions reductions. These credibility issues manifest in several ways: forestry projects vulnerable to wildfires that invalidate sequestered carbon, renewable energy projects that would have proceeded without credit revenues, and verification methodologies that overstate actual climate benefits. In 2022 alone, over six million carbon credits were invalidated due to wildfires destroying designated sequestration forests, highlighting the physical risks inherent in nature-based solutions. The lack of consistent standards across verification bodies creates fragmentation, with credit quality and pricing varying dramatically based on certification source and methodology rigor. While initiatives like the Integrity Council for Voluntary Carbon Market's Core Carbon Principles aim to establish standardized quality benchmarks, adoption remains limited and credits bearing high-integrity labels often trade at prices buyers resist paying. For Portugal's emerging market, building trust requires transparent verification processes, conservative baseline assumptions, comprehensive risk mitigation for reversal scenarios, and alignment with evolving EU certification frameworks to prevent the market from being undermined by low-quality credits that damage overall credibility.

Infrastructure and Platform Development Delays

Despite the legislative framework entering force in January 2024, Portugal's voluntary carbon market remains partially operational due to critical infrastructure gaps that delay full market functionality. The national electronic registry platform managed by ADENE, essential for recording projects, credits, and transactions, is not expected to become operational until the second half of 2025, nearly 18 months after the decree's enactment. This platform delay prevents project developers from registering initiatives and issuing credits, while potential buyers cannot verify or trade credits through official channels. The development of sector-specific methodologies, while progressing with the first forestry-focused methodology undergoing public consultation, remains incomplete for many project types including industrial emissions reductions, blue carbon initiatives, and waste management projects. The qualification process for independent verification bodies required by Government Ordinance No. 240/2024 adds another layer of complexity, requiring verifiers to meet stringent education, experience, and examination requirements before certification. These procedural bottlenecks create uncertainty for project developers who have invested in carbon sequestration or emissions reduction initiatives but cannot yet monetize their efforts through credit sales. The absence of operational infrastructure also limits price discovery mechanisms, as trading cannot occur through standardized platforms with transparent pricing. For rural and remote areas targeted for priority forestry projects, limited digital connectivity compounds these challenges, potentially excluding regions with significant carbon sequestration potential from participating effectively in the market once platforms become operational.

Price Volatility and Market Fragmentation

Carbon credit markets globally experience significant price volatility driven by regulatory uncertainty, supply-demand imbalances, and quality differentiation that creates challenges for market participants. Voluntary credits display even greater price dispersion, ranging from EUR 5 to EUR 300 per tonne depending on project type, verification standard, and permanence characteristics. This extreme variation complicates corporate purchasing decisions, as companies struggle to determine fair value and appropriate credit quality for their offsetting strategies. The market fragmentation between compliance markets (EU ETS) and voluntary markets creates parallel pricing mechanisms with limited interoperability, while different certification standards further segment the market. Transaction volumes in voluntary markets declined in 2024, suggesting buyer hesitation amid quality concerns. For Portuguese project developers, this volatility creates revenue uncertainty that complicates project financing and long-term planning, particularly for capital-intensive initiatives like carbon capture facilities or large-scale reforestation. The prohibition on using voluntary credits for EU ETS compliance or Paris Agreement nationally determined contributions limits demand channels, while the absence of developed futures or derivatives markets in Portugal prevents risk hedging strategies. As the market matures, establishing clear quality tiers, standardized pricing mechanisms, and financial instruments for price risk management will be essential for attracting sustained investment and enabling the market to scale effectively toward Portugal's 2050 carbon neutrality objectives.

Portugal Carbon Credit Trading Market Report Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the Portugal carbon credit trading market, along with forecasts at the country and regional levels for 2026-2034. The market has been categorized based on type, project type, trading type, buyer type, and end use industry.

Analysis by Type:

• Voluntary Carbon Market (VCM)
• Compliance Carbon Market (CCM)

The report has provided a detailed breakup and analysis of the market based on the type. This includes voluntary carbon market (VCM) and compliance carbon market (CCM).

Analysis by Project Type:

• Renewable Energy
• Energy Efficiency Projects
• Forestry and Land Use
• Waste Management
• Industrial Process Emission Reduction
• Carbon Capture, Utilization, and Storage (CCUS)
• Others

A detailed breakup and analysis of the market based on the project type have also been provided in the report. This includes renewable energy, energy efficiency projects, forestry and land use, waste management, industrial process emission reduction, carbon capture, utilization, and storage (CCUS), and others.

Analysis by Trading Type:

• Spot Trading
• Futures Trading
• Options and Derivatives

The report has provided a detailed breakup and analysis of the market based on the trading type. This includes spot trading, futures trading, and options and derivatives.

Analysis by Buyer Type:

• Compliance Buyers
• Voluntary Buyers
• Traders and Intermediaries

A detailed breakup and analysis of the market based on the buyer type have also been provided in the report. This includes compliance buyers, voluntary buyers, and traders and intermediaries.

Analysis by End Use Industry:

• Energy and Power
• Manufacturing and Heavy Industries
• Oil and Gas
• Transportation
• Agriculture and Forestry
• Waste Management
• Others

The report has provided a detailed breakup and analysis of the market based on the end use industry. This includes energy and power, manufacturing and heavy industries, oil and gas, transportation, agriculture and forestry, waste management, and others.

Analysis by Region:

• Norte
• Centro
• A. M. Lisboa
• Alentejo
• Others

The report has also provided a comprehensive analysis of all the major regional markets, which include Norte, Centro, A. M. Lisboa, Alentejo, and Others.

Competitive Landscape:

The Portugal carbon credit trading market is in its nascent development stage following the establishment of the voluntary carbon market framework in 2024. The competitive landscape is characterized by emerging domestic project developers focusing on forestry and blue carbon initiatives alongside international carbon market operators seeking to establish presence in the Portuguese market. Competition centers on securing priority project areas designated by the government, developing robust methodologies approved by the Portuguese Environment Agency, and achieving verification from certified independent bodies. Early market entrants are positioning themselves to leverage Portugal's emphasis on nature-based solutions, particularly coastal and marine ecosystems offering blue carbon sequestration potential. Technology-focused players are developing digital platforms for carbon project registration, MRV services, and credit trading infrastructure. The market also sees participation from waste management companies like Veolia implementing carbon capture projects, energy sector entities exploring renewable energy credits, and agricultural cooperatives investigating soil carbon programs. As the national registry platform becomes operational in 2025, competitive dynamics will intensify around credit quality differentiation, pricing strategies, and establishing trusted verification partnerships to capture market share in Portugal's evolving carbon economy.

Portugal Carbon Credit Trading Industry Latest Developments:

• October 2025: The Portuguese government has officially launched the national voluntary carbon market (VCM), introducing a new digital platform for transaction registration, with the initial approved methodology concentrating on the enhancement of forest carbon sinks. The new platform, accessible at www.mvcarbono.pt, will allow project developers, credit verifiers, and purchasers to register, trade, and cancel carbon credits produced domestically, guaranteeing transparency, traceability, and environmental credibility, which are essential for the initiative’s success.

Portugal Carbon Credit Trading Market Report Coverage:

Key Questions Answered in This Report:

• How has the Portugal carbon credit trading market performed so far and how will it perform in the coming years?
• What is the breakup of the Portugal carbon credit trading market on the basis of type?
• What is the breakup of the Portugal carbon credit trading market on the basis of project type?
• What is the breakup of the Portugal carbon credit trading market on the basis of trading type?
• What is the breakup of the Portugal carbon credit trading market on the basis of buyer type?
• What is the breakup of the Portugal carbon credit trading market on the basis of end use industry?
• What is the breakup of the Portugal carbon credit trading market on the basis of region?
• What are the various stages in the value chain of the Portugal carbon credit trading market?
• What are the key driving factors and challenges in the Portugal carbon credit trading market?
• What is the structure of the Portugal carbon credit trading market and who are the key players?
• What is the degree of competition in the Portugal carbon credit trading market?

Key Benefits for Stakeholders:

• IMARC's industry report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the Portugal carbon credit trading market from 2020-2034.
• The research report provides the latest information on the market drivers, challenges, and opportunities in the Portugal carbon credit trading market.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the Portugal carbon credit trading industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.