The World Bank has reported that revenues generated from carbon pricing mechanisms worldwide exceeded $107 billion in 2025, marking another year of steady growth in global climate finance.
According to the bank’s *2026 State and Trends of Carbon Pricing* report, revenues from emissions trading systems (ETS) and carbon taxes rose by 2% in 2025. This continues a strong decade-long expansion, with annual revenues climbing from less than $30 billion in 2016 to over $100 billion every year since 2021.
The report highlights the accelerating adoption of carbon pricing as countries work towards fulfilling their commitments under the Paris Agreement.
Expanding Coverage
The share of global greenhouse gas emissions covered by emissions trading systems has grown significantly — from about 8% in 2016 to over 24% in 2025. In contrast, coverage under carbon taxes has remained relatively stable at around 4–5% of global emissions.
While advanced economies continue to generate the bulk of carbon pricing revenues due to higher prices and more mature systems, several middle-income countries are making notable progress. The World Bank expects further expansion in the coming years, particularly as India, Japan, and Vietnam strengthen their national emissions trading frameworks.
Nigeria’s Carbon Market Ambition
Nigeria is positioning itself to take advantage of the growing global carbon economy. In January 2026, President Bola Ahmed Tinubu approved the operationalisation of the country’s national carbon market framework.
The initiative is designed to establish Nigeria as a key player in Africa’s carbon credit market. The Federal Government estimates that the carbon market could generate at least $3 billion annually by 2030 through carbon credit trading and climate-related investments.
This aligns with earlier plans unveiled in November 2025 to mobilise up to $3 billion yearly in climate finance via the National Carbon Market Framework and Climate Change Fund.
Future Outlook
Experts believe Nigeria is well-placed to benefit from carbon markets due to its vast forest reserves, renewable energy potential, and growing clean energy sector. Beyond revenue generation, the market is expected to drive job creation, technology transfer, and support the country’s energy transition goals.
However, stakeholders have emphasised the importance of establishing robust regulatory frameworks, credible monitoring systems, and transparency in carbon credit issuance to build international confidence and maximise benefits.
