Enowa, the energy and water company of NEOM, has signed a long-term agreement with the Voluntary Carbon Market (VCM) company in Saudi Arabia. The deal will provide Enowa with around 30 million tons of carbon credits between now and 2030.
VCM was launched by Saudi Arabia’s Public Investment Fund (PIF) and the Saudi Tadawul Group in 2022. It runs a platform to trade voluntary carbon credits. The first delivery under the Enowa agreement happened on December 19, 2024.
Most of the carbon credits will come from international projects located in developing regions, also called the Global South. These credits will be used to help Enowa offset emissions while building renewable power and infrastructure for NEOM.
Enowa has already taken part in earlier VCM auctions, including events held in Saudi Arabia in 2022 and in Kenya in 2023.
The VCM platform began operating in November 2024. It offers services including auctions, request-for-quote trading, and block trades. A spot market is scheduled to launch in 2025. The platform is also linked to global carbon credit registries. This helps ensure accuracy and traceability of transactions.
Enowa was the first company in the country to sign a long-term carbon credit deal on the VCM platform. The credits are expected to support long-term development projects and help meet NEOM’s low-emission targets.
The VCM platform is being developed to support various features including compatibility with Islamic financial rules. It also allows private and public sector buyers to find and buy carbon credits through a formal marketplace. These credits come from verified emissions reduction or removal projects.
According to the VCM press release, the voluntary carbon market globally could grow from $2 billion in 2020 to an estimated $250 billion by 2050.
The agreement is part of Saudi Arabia’s broader efforts to grow its domestic carbon trading sector and support energy transition plans. NEOM is one of the country’s major development zones currently being built in the northwest of the Kingdom.
