Regulation and future prospects of the Italian voluntary forestry carbon credit market

The carbon market for the forestry sector is internationally recognized as a policy tool to reduce greenhouse gas emissions, to support afforestation and to improve forest management activities, which would not be economically viable without the sale of carbon credits. The international market is regulated by standards based on Guidelines for national greenhouse gas inventories, and in many countries, domestic markets are emerging, managed by governments whose credits can be used to meet national climate targets under the UNFCCC. In Italy, the market is currently unregulated, despite the approval of a law to establish a national registry for agriculture- and forest-based carbon credits. An analysis of the voluntary carbon credit market for the Italian forestry sector from 2011 to 2024 revealed an active market, with credit transactions priced in line with other European domestic markets. Although volumes are lower, they have been growing in recent years and peaked in the period 2021-2022. Monitoring by the Carbon Monitoring Unit highlighted critical issues and verified the impact and future prospects of the market if it is regulated by the introduction of National Guidelines and the National Registry of agriculture and forestry carbon credits.