Corporate Carbon Removal Strategies: A Critical Examination

Achieving net-zero greenhouse gas emissions by 2050 is a global imperative, yet a recent report by the NewClimate Institute reveals a significant gap between corporate climate claims and the effective carbon removal strategies needed to meet this goal. The report highlights that many major companies are relying on short-term carbon removal methods, such as tree planting, rather than investing in more reliable, durable carbon dioxide removal (CDR) technologies.

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The NewClimate Institute's analysis of 35 leading companies across sectors including tech, aviation, and fossil fuels indicates that while some firms, particularly in the tech industry, are investing in durable CDR, most are not integrating these efforts with comprehensive decarbonization strategies. For instance, Microsoft accounts for 70% of all durable CDR contracts, yet the report criticizes tech companies for planning to use both durable and nondurable CDR to meet net-zero targets. In aviation, only Japan's All Nippon Airways has a credible plan for using durable CDR to offset residual emissions by 2050.

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Critics argue that the reliance on short-lived carbon offsets undermines genuine climate action. John Moore, an expert from the NewClimate Institute, expressed concern over the lack of transparency regarding the environmental and social risks associated with CDR projects. He noted that none of the companies analyzed disclosed potential risks or mitigation strategies for their carbon removal initiatives. Jonathan Overpeck, a climate scientist, emphasized that the focus should be on reducing emissions rather than relying on CDR as a substitute for meaningful action.

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In parallel, companies like Puro.earth are making strides in the engineered carbon removal market. Recently securing €11 million in funding, Puro.earth aims to enhance its infrastructure for issuing CO2 Removal Certificates (CORCs) and improve transparency in carbon credit transactions. The platform has already issued over 1 million CORCs, reflecting a growing demand for verified carbon removal credits. Analysts predict that the carbon removal market could expand from a valuation of $2.7 billion in 2023 to as much as $100 billion annually by 2030-2035, contingent on stronger policy support and technological advancements.

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Soil carbon credits are also gaining attention as a means to leverage agricultural practices for carbon sequestration. However, significant scientific and social uncertainties remain. Critics highlight issues such as measurement inaccuracies and the exclusion of early adopters from credit programs. Ensuring fair compensation for farmers and addressing potential land dispossession are crucial for the credibility of soil carbon markets.

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The NewClimate Institute has called for clearer definitions of durable carbon removal and separate targets for emissions reductions and CDR support. They argue that companies should not use investments in carbon removals to obscure inaction on decarbonization. Meanwhile, Puro.earth's Jan-Willem Bode stated, “With this latest round of funding, we’re strengthening the systems that facilitate scale in CDR deployment.”

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• “dangerous mismatch between corporate climate claims and the reality of what is needed to reach global net-zero,” — NewClimate Institute

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• “Right now the whole idea of CDR … is kind of a Wild West scene, with lots of actors promising to do things that may or may not be possible,” — Jonathan Overpeck, University of Michigan

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• “Not a single company in our report disclosed details on potential risks of projects they support and how they mitigate those,” — John Moore, NewClimate Institute

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As the urgency for effective climate action intensifies, the corporate sector faces increasing scrutiny regarding its carbon removal strategies. The need for robust, transparent, and scientifically backed approaches to carbon removal is paramount. Companies must prioritize genuine emissions reductions while responsibly investing in durable CDR solutions to align with global climate goals.

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