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The global market for traded carbon dioxide (CO2) permits hit a record $948.75 billion U.S. in 2023, according to data from LSEG, formerly known as Refinitiv.

Countries around the world have established emissions trading systems to put a price on CO2 emissions and motivate companies to invest in low carbon technologies that help governments reach their climate goals.

Around 12.5 billion metric tons of carbon permits were traded on the world's emissions markets in 2023 and record prices in the U.S. and China pushed the value of those permits to all-time highs, according to LSEG’s “Carbon Market Year in Review.”

The European Union’s carbon market remains the world's most valuable and rose by 2% in 2023 from a year earlier, representing 87% of the global total.

The price of carbon permits in Europe hit a record high in February 2023 but fell towards the end of last year amid weak demand from industrial buyers. This bearish trend has continued into 2024.

The value of British carbon permits declined 22% last year, while North America prices hit record highs in 2023, driven by aggressive trading in greenhouse gas emission permits.

Carbon permit prices in China also hit a record high last year, helping to offset the year-end weakness seen in Europe and England, said LSEG in its report.

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