Press release by Department for Energy Security and Net Zero, Department for Environment, Food & Rural Affairs, Mary Creagh CBE MP and Kerry McCarthy MP

The UK government has launched a new initiative with the intent of strengthening voluntary carbon and nature markets, aiming to establish the UK as a global hub for green finance. This move is part of its broader Plan for Change to drive investment, create new revenue streams for businesses, and unlock private finance to tackle the climate crisis.

These markets allow businesses to trade carbon credits—units representing the reduction or removal of greenhouse gas emissions—by investing in environmental projects like reforestation or clean energy. However, due to a lack of clarity and inconsistent standards, these markets have not reached their full potential. The UK is now setting out integrity principles to build trust, define what constitutes a high-quality carbon credit, and ensure transparency in how credits are used and reported.

The voluntary carbon market could be worth up to $250 billion by 2050, and nature markets up to $69 billion. By boosting confidence in these systems, the UK aims to help businesses, including farmers and land managers, tap into growing green finance opportunities. Recent growth figures show the net zero economy is already expanding faster than the wider economy, highlighting the potential for green finance to drive sustainable economic growth.

Ministers and climate leaders emphasise that this framework will not only support businesses but also ensure environmental and social integrity, including the protection of Indigenous rights. The 12-week consultation seeks input from the public and industry on how to best implement these principles and scale high-integrity carbon markets.

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