Carbon markets have moved to the forefront of corporate and regulatory agendas as global attention to climate change and sustainability intensifies. Worldwide, many jurisdictions—including Thailand—are finding carbon markets to be promising tools in their efforts to combat climate-warming emissions and accelerate their net-zero pathways and sustainability commitments.

According to the Thailand Greenhouse Gas Management Organization’s (TGO) 2025 Voluntary Carbon Market Survey, approximately 3.29 million tonnes of CO₂ equivalent (tCO₂eq) were traded under Thailand’s domestic standard between 2020 and 2024 with a cumulative market value of approximately THB 314.5 million (approximately USD 9.43 million), and 524 projects had been registered under the Thailand Voluntary Emission Reduction Program (T-VER) framework.

Carbon Credits in Thailand

Thailand’s carbon credit regime is, at present, entirely voluntary. There is not yet any obligation for businesses to purchase or retire carbon credits, although this may change once the draft Climate Change Act is enacted.

The draft Climate Change Act, which is currently undergoing legal review before submission to Parliament, is expected to introduce a mandatory emissions trading system (ETS), under which  legal entities in designated sectors will be allocated emissions allowances and will be required to surrender sufficient allowances to cover their verified emissions, with penalties for shortfalls. Rather than imposing a blanket obligation on all businesses to purchase or retire carbon credits, the draft act is expected to allow ETS-covered entities to use eligible carbon credits (for example, those certified under T-VER) to meet only a limited, capped portion of their compliance obligation, with the applicable cap and eligibility criteria to be set out in subordinate regulations and the relevant allocation plan.

The principal domestic framework for carbon credits is the T-VER, administered by the TGO. While some project developers in Thailand also operate under international standards such as Verified Carbon Standard or the Gold Standard, T-VER is the predominant domestic standard and accounts for the large majority of registered projects. Under T-VER, a carbon credit represents one tonne of greenhouse gas that has been reduced or sequestered by a registered project and recorded in the TGO’s official registry. Thailand currently operates two tiers of the program: Standard T-VER and Premium T-VER, with the latter designed to align with article 6 of the Paris Agreement and facilitate the international transfer of Thai-origin credits.

How Credits Are Issued

Generating carbon credits under T-VER involves two key stages: project registration and credit certification.

At the project registration stage, the project’s developer must demonstrate that its project is located in Thailand and that the anticipated emission reductions are genuine, go beyond what would have occurred under ordinary circumstances, and are not counted under any other program. An independent TGO-accredited assessor reviews the project, and the TGO’s board considers and approves it for registration.

At the credit certification stage, the developer reports on the emission reductions and sequestration actually achieved. An independent assessor verifies those results, and the TGO’s Board certifies the corresponding credits, which are then recorded in the TGO’s registry and become available for trading.

Trading of Credits

Once certified, carbon credits may be traded. Trading currently takes place either directly between parties on an over-the-counter (OTC) basis or through the TGO’s trading platform. So far, OTC transactions remain the primary channel and account for more than 56% of purchases. Buyers and sellers in the market are required to open accounts in the TGO’s carbon credit registry in order to hold and transfer credits.

The market infrastructure is developing quickly. Following cabinet approval in February 2026, the Securities and Exchange Commission (SEC) issued a notification in March 2026 (effective April 1, 2026) reclassifying carbon credits as goods eligible to serve as underlying assets under the Derivatives Act, paving the way for futures contracts on carbon credits to be traded on the Thailand Futures Exchange (TFEX) with both physical delivery and cash settlement. Digital tokens backed by carbon credits are also emerging as an additional trading channel (more on this below). This reflects a broader policy ambition for Thailand to become a regional hub for carbon credit trading. The pending Climate Change Act is expected to add a compliance market alongside the existing voluntary market, which would significantly expand the scope of carbon credits regulation in Thailand and increase demand for credits.

Tokenization of Carbon Credits

Tokenization refers to the process of representing an asset, such as carbon credit, as a digital token recorded on a blockchain or other distributed ledger. In the carbon market context, this is generally achieved either through a “carbon bridge,” under which a credit already issued in a conventional registry (such as the T-VER registry, Verra, or Gold Standard) is locked or retired in that registry while a corresponding token is minted on-chain, or through native issuance, under which the registry issues the credit as an on-chain token from the outset. The legal character of the resulting token depends on the rights it confers on the holder. A token that simply represents an underlying credit for retirement or offsetting purposes, without offering a financial return, is generally treated as a form of utility token, whereas a token structured to give holders a financial return, such as a share of future carbon credit sales revenue, is more likely to be characterized as an investment token and brought within Thailand’s capital markets and securities regulatory perimeter. This distinction is central to how tokenized carbon credits intersect with capital market laws in Thailand.

A recent domestic example, governed by Thai law, illustrates this. In mid-2026, Token X (an SEC-licensed ICO portal under SCB group), with Siam TC Technology Co., Ltd. (STCT), a subsidiary of DITTO (Thailand), launched Blu Green Token (BLU), marketed as Thailand’s first digital token backed by carbon credits. BLU is an investment token in relation to mangrove reforestation credits, offering 400 million tokens at THB 1.20 each (up to THB 480 million, or approximately USD 14.7 million) over a seven-year term, with returns tied to future carbon credit sales revenue.

From a Thai regulatory perspective, digital tokens are primarily governed by the Emergency Decree on Digital Asset Businesses, which distinguishes “utility tokens” (conferring rights to specific goods, services, or entitlements) from “investment tokens” (conferring rights to participate in an investment in a project or business). Investment tokens are subject to a regime broadly analogous to a securities offering, requiring SEC approval, a registration statement and prospectus, and distribution through an SEC-licensed ICO portal.

Selling Credits Internationally

Thai carbon credits can be sold to foreign buyers, with the mechanism for doing so depending on the buyer’s intended use. For private-sector buyers who simply wish to use the credits for voluntary offsetting, the seller may cancel the credits in the TGO’s registry and provide the buyer with a cancellation certificate, or the buyer may open an account in the TGO’s registry to hold the credits directly. Neither route requires special authorization from the TGO, provided the buyer’s country accepts Thai-standard credits.

A separate and more regulated process applies where credits are to be used for “international purposes”—that is, where they will count toward another country’s emissions reduction target under the Paris Agreement or other international agreements. In August 2025, Thailand’s cabinet approved a guideline establishing the framework for such transfers, which requires authorization from the director-general of the Department of Climate Change and Environment (DCCE) and corresponding adjustments to avoid double counting.

Tax Incentives

To encourage participation in the carbon credit market, income derived from the sale of T-VER carbon credits may qualify for a corporate income tax exemption for a specified number of accounting periods, subject to conditions prescribed under the Revenue Code and its subordinate legislation.

Considerations for Foreign Participants under the Foreign Business Act

Foreign entities should be aware that the Foreign Business Act may apply to their involvement in the carbon credit market. Depending on the underlying activities, some projects (particularly those involving forestry or agriculture) may fall within business categories restricted to foreigners, and the sale of carbon credits by a foreign entity can itself be treated as a restricted service business requiring a Foreign Business License or other applicable exemptions.

Looking Ahead

Thailand’s voluntary carbon credit market framework is well established, but the compliance side remains in flux pending enactment of the Climate Change Act, and the rules that bear on any given project are spread across several regimes—the T-VER framework, capital markets regulation where credits are tokenized, the Foreign Business Act, and the Revenue Code. Businesses considering carbon credit projects, investments, or transactions in Thailand should check the current status with local specialists before committing to a structure, as the requirements applicable to a project may shift as the legislation advances.