Three Green Markets to Combat the Climate Crisis

Climate change is an economics problem. From carbon capture to green steel, IDTechEx's research encompasses a wide range of existing innovative technologies with the potential to decarbonize the planet. However, costs are generally higher compared with the fossil fuel status quo and delivering to early adopters isn't always straightforward. Therefore, creative market mechanisms are needed, unlocking green technologies for buyers across a wide range of sectors and geographies.

 

 

 

 

Renewable energy can provide the blueprint. While as of today, wind and solar technologies can be cheaper than fossil fuels on a $/MWh basis, cost reductions were only enabled by widespread deployment. This scale up was driven by Renewable Energy Certificate (REC) markets, which accounted for the "green premium" associated with low-carbon renewables. When RECs are sold, what's transferred is not the electricity produced but the attributes that make it clean energy. When companies buy RECs, they provide financial support for the renewable energy projects that produce them, boosting the business case.

 

According to IDTechEx's "Sustainability for Data Centers" report, some of the world's largest companies - including Amazon and Apple - already voluntarily purchase large amounts of renewable power attributes each year. But renewable electricity is only part of the battle when it comes to combatting the climate crisis. What about technologies that can address legacy emissions or non-power related CO₂ sources?

 

 

Reaching global net-zero by 2050 targets will require large-scale carbon dioxide removal (CDR) beyond the planet's natural sinks to tackle residual emissions. For the highest quality, durable, carbon dioxide removals, voluntary corporate purchasers have again enabled green market creation. In the form of carbon credits, carbon dioxide removal offers a pathway to address scope 3 supply chain emissions and even achieve carbon negativity. This market has grown rapidly. In 2022, fewer than a million tonnes of credits were sold, but in 2025 a single deal can easily exceed 5 million tonnes. Microsoft has been an indisputably powerful driving force here, accounting for 80% of all durable carbon dioxide removal credit purchases.

 

Many carbon dioxide removal technologies have been monetized in the form of carbon credits, including direct air capture, enhanced rock weathering, and biochar. According to IDTechEx's carbon dioxide removal forecasting, over 100 million tonnes of durable, engineered carbon dioxide removal per year could be delivered by 2035.

 

Currently, most deals in the carbon dioxide removal space are pre-purchases. Instead of making an equity investment, these pre-purchasers are committing to buy a product early to bring it to market faster, despite the current high cost. This illustrates clear demand and creates market signals, spurring investment into first-of-a-kind CDR demonstration projects.

 

 

Cement accounts for 8% of global CO₂ emissions. Decarbonization of cement will require more than just electrification, due to underlying process CO₂ emissions associated with limestone. There are many innovative solutions being developed, as analyzed in IDTechEx's "Decarbonization of Cement 2025-2035" research. These include new raw materials, new cement chemistries, and new cement production processes.

 

Driving factors such as the EU's Carbon Border Adjustment Mechanism (CBAM) and the desire for greener data centers as AI booms are sparking commercial scale up for innovative green cement players. For example, in 2025 Microsoft announced it has signed an agreement with Sublime Systems (an electrochemical cement start-up) to buy up to 623,000 tonnes of low-carbon cement from Sublime's future facilities. One of the challenges faced by nascent green cement developers is that early offtakers won't always be physically located near pilot and demonstration facilities. To address this, the Microsoft-Sublime deal gives Microsoft not only the option to physically deploy cement when geographically possible, but Microsoft will also be able to purchase the environmental attribute certificates (EACs) of Sublime cement separately.

 

This chain of custody model, known as 'book and claim', learns key lessons from renewable energy markets and decouples the low carbon intensity of the cement from the physical unit. Alexis Olans Haass, Managing Director of EU Market Development, reported to IDTechEx that EACs "ensure demand can materialize", enabling flexibility for offtakers, and allowing green cement projects to come online that "otherwise wouldn't have been built".

 

The book and claim model is not limited to cement. Other decarbonization areas benefitting from this model include sustainable aviation fuel and green steel. Sublime Systems is hopeful that the groundwork built with Microsoft could lead to "cross-pollination across industries that can benefit all."

 

 

Many technologies required for global decarbonization already exist. The challenge lies in how to open green markets to early adopters, laying the foundation for widespread uptake. From the scale-up of wind and solar over the past 50 years, the value of decoupling environmental benefits form physical geography is clear. CDR carbon credit markets have demonstrated how rapidly green markets can be scaled up through advanced market commitments and demand signals. While carbon credit and REC markets have not been free from controversy, new green markets focused on measurability and additionality can accelerate climate action globally.

 

To learn more about the technologies and business models underpinning green innovations, please visit www.IDTechEx.com/Research/Energy.