The Rise of Carbon Removals: Divergent Corporate Strategies
As the world shifts towards net-zero planning, carbon removals (CDR) have become a crucial component of corporate climate strategies. However, companies are adopting different approaches to tackle this challenge. In this blog, we’ll explore the various strategies being employed and the implications for businesses.
Why Carbon Removals Matter
Science-aligned pathways require deep value-chain cuts and durable removals to neutralize residual emissions. The Oxford Offsetting Principles (2024) recommend a staged transition from avoidance/reduction credits to 100% removals by 2050, emphasizing durable storage solutions like mineralization, DACCS, and BECCS.
The Role of Technology
Advancements in technologies like Direct Air Capture (DAC) and Bioenergy with Carbon Capture and Storage (BECCS) are critical for scaling up carbon removals. Companies like Climeworks and Carbon Engineering are already leveraging DAC to capture CO2 from the atmosphere, while others are exploring BECCS as a viable solution for negative emissions. As these technologies mature, costs are expected to decrease, making carbon removals more accessible to businesses.
Divergent Strategies
Companies are pursuing different playbooks:
- Pioneers: Anchoring multi-million-tonne, high-durability contracts to jump-start supply.
- Hedgers: Diversifying portfolios and financing structures to mitigate risks.
- Platform builders: Creating guardrails to bring their ecosystems along cautiously.
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Cautious followers: Limiting action to “beyond-value-chain mitigation” (BVCM) while prioritizing internal abatement.Integrity Frameworks
Integrity Frameworks
Recent updates to integrity frameworks provide guidance:
- SBTi: Encourages near-term BVCM alongside required reduction targets, with removals for neutralizing true residuals.
- Oxford Offsetting Principles: Call for a staged transition to 100% removals by 2050.
- ICVCM’s Core Carbon Principles: Provide a quality floor for credits.
- VCMI’s Claims Code: Defines how companies can credibly communicate credit usage.
The Road Ahead
As companies navigate the complex landscape of carbon removals, strategic divergence is expected. However, with integrity frameworks maturing, businesses must prioritize durable removals and credible communication to achieve net-zero goals.
