Saudi Arabia has made a major move to strengthen its carbon markets and advance its climate objectives.

A memorandum of understanding signed on October 30 between the Regional Voluntary Carbon Market Company (RVCMC) and the Clean Development Mechanism Designated National Authority (CDMDNA) aims to ensure the transparency, robustness, and credibility of the Kingdom’s carbon markets.

The move aligns with Saudi Arabia’s climate strategy, which includes achieving net-zero emissions by 2060 and cutting carbon emissions by 278 million tons annually by 2030 as part of the Saudi Green Initiative.

The private sector is actively encouraged to participate in sustainability efforts, especially in renewable energy, waste management, and eco-friendly construction. High-integrity carbon credits are key to financing emission-reducing initiatives and aiding the global transition to a low-carbon economy. 

Voluntary carbon markets also play a vital role in these efforts, with Saudi Arabia intensifying its drive to diversify its economy and combat climate change.

Saudi Arabia’s initiatives include ambitious carbon capture targets, with plans to capture 44 million tons of CO2 annually by 2035 and utilize 2 million tons daily to produce eco-friendly products like green methanol and clean fuels.

RVCMC, established in 2022 as a joint venture between PIF and the Saudi Tadawul Group, held a record-setting voluntary carbon credit auction in Nairobi in June of last year, selling over 2.2 million tons of carbon credits to help industries contribute to the global low-carbon transition.