by Noah Deich, executive director
It is increasingly clear that companies across industries will need to shift their climate commitments from net-zero to net-negative (i.e. removing more carbon from the atmosphere than they emit) to meet global climate goals. Fortunately, a number of companies are paving the way when it comes to integrating carbon removal into corporate climate action plans, shining a light for other companies looking to map a course forward on carbon removal. We’ve had a front row seat to witnessing this transformation, and are seeing four emerging pathways that any company can pursue today to join the ranks of corporate carbon removal pioneers.
Why carbon removal?
First, what’s carbon removal and why does it need to be central to corporate climate action? Many corporate climate plans focus on reducing emissions, but removing carbon already in the air is essential to limit warming and meet global climate goals. Eliminating emissions alone would have been a viable solution if we had started 30 years ago… but we didn’t. Now our best chance for avoiding the most disastrous effects of climate change requires both slashing emissions at breakneck speed and immediately scaling carbon removal efforts.
A four-part blueprint for corporate carbon removal action
While corporate carbon removal action is still in its infancy, early leaders have quickly illuminated four action areas key to having a meaningful impact on advancing carbon removal solutions.
1. Talk publicly about net-negative commitments
In fact, shout about it. Narratives matter, and companies change them. No one will take action on carbon removal if they don’t realize that net-zero is an intermediate milestone — not an end zone — and that only working to also remove the carbon already in the air can allow us to deliver on the climate goals we need to hit.
Microsoft has pledged to clean up its entire cumulative carbon footprint by 2050 — a step beyond even what the governments of California and Sweden (known climate champions) have committed to. These kinds of commitments are encouraging because often organizations are only willing to set climate goals that they know they can achieve… and that don’t cost much either. Many organizations are likely to be hesitant to set such ambitious goals, but Microsoft’s conviction will hopefully inspire others to join them in pursuing this essential goal even in the face of uncertainty.
Where to start
Setting a negative emissions goal is actually a bit more challenging than it would appear on the surface — simply calculating cumulative historic emissions can be tricky, as can getting the disclosure structured clearly (i.e. reporting carbon removal activities as a separate line item alongside emissions reductions in annual sustainability disclosures). Recognizing these challenges, companies have begun to form coalitions to address carbon removal bottlenecks and help the whole field move forward more effectively.
2. Buy carbon removal
Some companies have already begun to purchase carbon removal, both as offsets/credits and directly through products that sequester carbon in their supply chain. Every company today can pursue one or both of these pathways in their carbon removal strategy.
Companies like Stripe and Shopify are seeking to break the offset mold entirely with a new approach to carbon removal — buying as much “carbon-removal-as-a-service” as they can with a fixed financial pledge. I can’t think of another example where the private sector has voluntarily led on buying down the cost of clean technology. Solar, wind, and electric vehicles all relied on government innovation and incentives to make technology that was initially too expensive cost competitive in the long run, and it’s great to see companies leading on carbon removal and not waiting for government action. While these companies’ commitments alone only represent the first step in what is needed to buy down carbon removal solution costs, additional corporate commitments to buy carbon removal services could create the critical mass needed to catalyze a positively reinforcing cycle of technology innovation and deployment.
Other companies are looking to sequester carbon via direct procurement in their supply chain. Interface is selling a carbon-negative carpet tile and General Mills is offering mac and cheese that was produced in a way that sequesters carbon in soils. The conventional wisdom is that carbon removal isn’t commercially viable today. But if we can have carpet or mac and cheese that sequesters carbon, the future is closer than the conventional wisdom holds. Opportunities for carbon removal in the supply chain are likely to prove catalytic for carbon removal — commitments from corporate buyers can enable innovative startups/agricultural producers to raise the capital they need to develop pilots and support early deployments.
Where to start
If you currently purchase voluntary carbon offsets, shift that budget towards carbon removal offsets. Oxford University recently released a set of principles for doing just that (with similar guidance from CDP and the Science Based Targets initiative). And if you can’t find carbon removal credits easily, don’t despair — you’re not alone (more on this from us soon). Fortunately, groups like Carbon Direct and CarbonPlan have sprung up to provide technical guidance for purchasing carbon removal products and services.
Once you do find carbon removal suppliers, the big catch comes when it’s time to pay for robust additionality and permanence. Voluntary offsets are sold for $1–15/ton today, substantially less than the estimated cost of carbon removal. Companies like SwissRe have publicly committed to pricing their own emissions at $100+/ton of CO2 (likely enough to support even direct air capture and storage in the future), and more companies need to shift their expectation of what high-quality offsets really cost. By paying a premium for carbon removal today — even on only a small fraction of total offset budgets — companies can grow their impact beyond their own footprint.
It’s still the Wild West when it comes to standards for accounting and reporting purchases of carbon removal products and services as part of large sustainability disclosure. Joining early leaders in creating standards and easily accessible markets will have catalytic impact for the field. Standards and markets for carbon removal are costly and time intensive to set up, but they only need to be set up once.
The conventional wisdom is that carbon removal isn’t commercially viable today. But if we can have carpet or mac and cheese that sequesters carbon, the future is closer than the conventional wisdom holds.
3. Invest in carbon removal solution innovators
Strategic innovation investments, both via external stakes in carbon removal solution providers and internal research and development spending, can have significant returns today.
Companies like Amazon and Oxy have started to place big strategic investment bets on carbon removal companies. Investing successfully in carbon removal is really challenging — the technology, market, and policy risks facing the field require a breadth and depth of investment expertise that few companies have today. As a result, companies have to make a bulletproof case that they are spending their investors’ capital wisely when they make bets on carbon removal — and increasingly, companies are doing just that.
Where to start
While we’ve seen investment in carbon removal pick up considerably, organizations developing carbon removal solutions still need early equity and project finance investments to conduct research and build early projects. By investing in carbon removal development, corporations can help startups and innovators get to market faster and more effectively. If you’re not sure where to start, the XPRIZE Foundation has created a handy investment resource spanning the carbon-to-value space.
4. Lobby, lobby, lobby
While companies can do a lot to drive demand for carbon removal, governments will be critical for funding carbon removal innovation and creating the incentives carbon removal innovators need to deploy their products at scale. That means that in addition to investing in carbon removal directly, companies can lobby policymakers to bolster support for research, development, and demonstration as well as building out robust incentives for deployment.
The Carbon Capture Coalition includes a number of large companies that advocate for carbon removal as part of broader carbon capture efforts, and the Coalition for Negative Emissions is focused on lobbying UK policymakers for carbon removal action. Additionally, organizations like CERES and the Climate Collaborative are starting to include more nature-based carbon removal strategies in their portfolios.
Where to start
Many organizations (like our team at Carbon180!) are eager to support new companies who want to join carbon removal policy efforts. A great way to get started is by simply reaching out — there are often opportunities to join coalition meetings as an observer or meet with staffers to help share long-term strategy as well as near-term policy priorities. Near-term priorities — whether it’s supporting non-partisan efforts like the House innovation package or appropriations funding in line with National Academies funding recommendations — would benefit greatly from more companies telling their congressional representation that this is a priority for them. And engaging with the coalitions over the long haul is a great way to ensure that policy recommendations reflect the experience of businesses on the front lines of carbon removal innovation.
Becoming a carbon removal pioneer
Companies activating all four of these levers — talk, buy, invest, and lobby — would have an immediate impact on advancing carbon removal. Corporates wield massive influence and can spark action among other companies, their customers, and policymakers. Setting net-negative climate goals and centering carbon removal is essential, and corporates are already illuminating how to move forward. These four pathways are a key part of building a better future.