Carbon Removal’s Next Chapter

Earlier this year, the industry was in a defensive posture, but now many are preparing to pivot, whether in strategy, location, or messaging. As other countries rapidly mobilise to fill the gap left by the U.S., what does that signal to you?

Yes, what’s happening at the federal level is pretty crushing in these early months of the new administration - no sugarcoating it. It’s not what we hoped for. But we shouldn’t count the U.S. out just yet. States and even cities can carry the torch in meaningful ways. While they don’t have the authority or treasury of the federal government, their cumulative impact matters. We are already seeing forward momentum in places like Colorado and Massachusetts, and multiple high-impact bills are moving through California, the world’s fifth-largest economy and home to the highest concentration of CDR companies globally.

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Outside the U.S., I’m encouraged by Canada’s federal leadership. A new report highlights its opportunity to become a global hub for CDR, leveraging its clean energy mix, vast CO₂ storage potential, and strong industrial base. In Europe, the Nordics are leading: Finland is funding CDR pilots and exploring removals in its carbon neutrality plan; Sweden has created a reverse auction scheme for durable removals; Denmark is investing in both nature-based and tech-based CDR; and the UK is advancing a business model for engineered removals and has committed to scale by 2030. Switzerland has a dedicated removals target and public procurement program. Germany, for its part, just released a Carbon Management Strategy that explicitly includes CDR and commits to enabling infrastructure and legal pathways. And at the EU level, we are inching closer to a coherent policy framework through the Carbon Removal Certification Framework (CRCF).

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In East Asia, Japan’s GX ETS is particularly noteworthy - it’s the first national carbon market in Asia to allow durable removals, with plans to scale its voluntary crediting mechanism and link with international markets. China is also increasing attention on engineered removals in its innovation and industrial policy. And in Brazil, which has a rich set of CDR-aligned industries and ecosystems, the recently enacted national ETS includes CDR as a compliance option, opening major market potential.

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So yes, the U.S. federal situation is a setback. But as our panel at Carbon Unbound made clear, not all doors are closed - even in Washington. And more importantly, the rest of the world isn’t waiting for the U.S. to lead. Momentum is clearly shifting - and diversifying.

Has carbon removal become, for net zero, what big banks were to the economy - too important to fail, environmentally, politically, and economically?

That’s a good way to put it from a science and ‘what the climate needs’ perspective - but the parallel breaks down when it comes to politics and markets. CDR isn’t “too big to fail”; it’s still small, and that makes it vulnerable. Unlike the banks, which are fundamental organs of the global economy, CDR is the last guy in to the climate transition club - and I worry it could be the first guy out when private capital and public funds get scarce because of other things happening in the economy and politically.

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But this is exactly the kind of moment we have to survive. If we do, we will come out stronger, more complex, and more resilient. Right now, it’s a fight for survival. But if we keep pushing - any way we can - we will get to the next level. I really believe that. We just have to keep moving forward.

Direct air capture and, to some extent, BECCS rely on robust federal policy support to scale. Given the current administration’s stance, what is the outlook for these technologies in terms of policy backing, funding, and long-term viability?

It’s true - DAC and BECCS, at this stage, absolutely rely on strong, sustained federal support to scale - and right now, that support is looking increasingly uncertain. The 45Q tax credit, which underpins the financial viability of most carbon removal projects in the U.S., has been flagged in recent tax policy proposals for potential rollback. While it’s still in place, that kind of uncertainty alone is enough to slow project development and shake investor confidence. DOE programs like the DAC hubs are still active, but future funding phases could be delayed or deprioritised. Early federal procurement pilots are small and discretionary, making them especially vulnerable to shifting political winds.

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We are already seeing signs of hesitation: capital is pausing, timelines are stretching, and developers are reassessing risk. But as I mentioned earlier, this isn’t the whole story. The opportunity hasn’t vanished - it’s shifting. Other countries are stepping in with more durable and coherent policies. And while this moment may represent a setback for DAC and BECCS in the U.S., I think in the longer term, it could be a strategic loss for U.S. leadership in an industry that has to be massive - and I believe will be.

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The question is whether we choose to lead or follow. And right now, we are handing that leadership away at the exact moment we should be doubling down.

Between the Biden administration’s policy push and the more isolationist rhetoric of the Trump presidency, the global carbon removal industry seems to be benefiting, both directly and indirectly, from two very different political positions. 

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Could this unusual combination of Biden-era incentives, proven test cases, and geopolitical frictions ultimately play to the industry's advantage by catalysing the global carbon market into full-scale emergence?

That’s a very interesting dynamic you are describing. And I do think that is a possible trajectory we are seeing the beginning of. Cliched but true - for every action there is a reaction. And maybe, tying together the different threads we have covered, improbably, something might be emerging that is directionally positive. But, don’t take your seatbelt off. This is going to progress in a bumpy way that we won’t be able to predict over any long horizon. We just have to keep making moves as the landscape shifts and patterns present themselves that we can act on. 

With Brazil’s new climate law introducing stronger compliance mechanisms, how is the country positioning its abundant biowaste and biochar resources to scale high-integrity carbon removal, and what role might its billion-dollar SAF investment play in strengthening its carbon market infrastructure?

Yeah, suddenly Brazil seems to be moving from massive latent potential to real progress. And it’s not just biochar and SAF. Arguably, Brazil is the most promising place for ERW really to take off. Massively abundant mafic and ultramafic minerals for ERW are already mined there, highly acidic soil makes the proposition really strong. And ‘rock dust’ is already a promoted, recognised soil amendment in the country. It’s not a coincidence that the first certified ERW carbon removal credits came out of the country earlier this year, and it will be the first of many.

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On top of this, Brazil has a strategic initiative to dramatically reduce fertiliser imports, not just through domestic production, but reduction. ERW and biochar can contribute to that goal. Finally, Brazil didn’t just put an ETS in place with that law last year; they also explicitly included durable and NBS CDR as eligible compliance pathways. Given the abundance of CDR options in the country, many of which big industries can directly invest in and even operationalise, I could see the new compliance regulations creating a strong rationale for CDR investment and demand. And this is all taking a clear shape just in time for COP 30 in Belem. I’m excited about Brazil, very excited. 

Given recent uncertainty around federal support and proposed cuts to DOE programs, how should we be thinking about the outlook for the U.S. carbon removal market over the next four years? What signals matter most, and where are you finding meaningful momentum despite political headwinds?

The good news is that the U.S. carbon removal industry, while still nascent, has grown and matured in the past few years. This progression has been due in part to supportive government programming and incentives, much of which was grounded in bipartisan support. Public and private sector efforts to improve and harmonise measurement, monitoring, reporting, and verification (MMRV) and to raise the standards for credit quality have begun to bear fruit, with the number of private sector buyers of carbon removal credits – and volume of overall sales – on an upward trajectory. So, while the domestic carbon removal industry is likely to face some headwinds due to shifts in federal policy and programming, on the whole, it is equipped to meet these challenges.

In the lead-up to the election, there was frequent mention of bipartisan support for carbon removal in the U.S., but just how strong and enduring is that support in practice?

As you note, carbon removal has had a history of strong bipartisan support through the last several congresses and administrations. In recent conversations with congressional offices on both sides of the aisle, that bipartisan support remains strong, especially in the districts that are home to carbon removal companies and projects. While the outcome of the reconciliation process ultimately might not reflect the desires of carbon removal advocates, we still see a path forward for new congressional action to support carbon removal across technology and nature-based pathways.

As federal support for carbon removal evolves, there may still be room for targeted policy and program continuity, particularly around areas like 45Q and infrastructure for storage. In your view, which projects or initiatives are most at risk in the current environment, and which are likely to endure?

We see an opportunity under the current administration for the further development of the CO₂ infrastructure that is absolutely critical for certain types of carbon removal to advance, in particular, direct air capture, due to synergies with point-source carbon capture.

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On the storage side, project developers need to be able to access geologic reservoirs in which to inject CO₂. Efforts to streamline the Environmental Protection Agency’s processing of the Class VI wells that enable this access, including the granting of authority over the permitting process to states (known as primacy), are positive in this regard and are likely to continue. CO₂ pipeline development is also crucial.

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The Pipeline and Hazardous Materials Safety Administration, housed within the Department of Transportation, estimates that the CO₂ pipeline network may need to expand tenfold by 2050 as new carbon capture projects come online. So that’s another area for possible movement. Of the clean energy tax credits being scrutinised by Congress as part of the budget reconciliation process, 45Q, which incentivises the storage and utilisation of CO₂ generated from either point source carbon capture or direct air capture, is amongst those that have fared the best. Of course, we want to support other carbon removal pathways beyond direct air capture, but we shouldn’t sell short the importance of protecting and advancing these existing incentives and infrastructure initiatives.

With U.S. carbon removal policy in flux, Canada is increasingly seen as a potential leader in this space. To what extent can it build on the U.S.'s policy, R&D, and deployment groundwork, and how might international coordination influence that trajectory and timeline?

U.S. leadership on carbon management has set a clear example of what successful government support looks like. Federal support for carbon removal has included public-private partnerships on research, development, design, and deployment, and MMRV; financial incentives, government grants, and loan programs across all stages of innovation and deployment; and a pilot carbon dioxide removal procurement program across carbon removal pathways. Other jurisdictions, including Canada, U.S. states, and others, will almost certainly continue to look to these efforts as a model for how to spur development of the carbon removal industry, albeit adapted for their own political and policy contexts.

The carbon removal industry relies on clear policy signals, with both real and perceived policy vacuums equally damaging market confidence. If the new administration advances policy, albeit under less favorable terms, what will it take to readjust the present narrative, and how long might that reputational shift take to register internationally?

The U.S. carbon removal industry is understandably cautious about moving forward with new projects and investments at this time. Given the history of bipartisan support for carbon removal, it is indeed likely that the new normal that emerges will include a role for the industry. However, the exact contours of the policy environment are likely to shift, perhaps creating new opportunities or applications for carbon removal, for example, where there are significant co-benefits beyond removal itself.

The carbon removal industry operates on clear policy signals, yet months into the new administration, much of the market remains in wait-and-see mode. How are you interpreting this delay, and have there been any clear signals indicating the government’s stance and spending priorities on carbon removal?

The new administration has been vocal about placing a target on climate technologies. But its specific intentions for CDR have been unclear. DOE has suffered severe layoffs, but they were broad cuts that mirror what’s been happening at every agency. And a lot is at stake, including DAC hubs and 45Q. 

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We are starting to see some signals coming in, and they aren’t all great. For example, the president’s budget included cuts that specifically called out “removing carbon dioxide from the air” as the target. Which means our industry probably won’t be able to avoid attention by being low profile. On the other hand, it seems there are members of Congress on both sides of the aisle that are coming to the defense of IRA and IIJA funding and fighting to maintain 45Q. There are real economic benefits to be gained from these investments, especially since much of the money is going to red states. But we are still waiting to see how it will all shake out.

With the current administration’s policy signals proving more chaotic and inconsistent than those of its predecessor, can market participants still rely and build on signals as they did during the Biden era?

There’s no question about it. The inconsistent policy signals from the administration make this a much more challenging environment in which to build projects. Across the board from BiCRS to marine CDR, these are capital-intensive endeavors. Most require project finance, which depends on economics that pencil out over a 15-30-year period. If the policies that govern the economic feasibility of these projects are shifting every 4 years, not to mention every couple of months, that can mean they don’t get built in the first place.

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Unfortunately, this isn’t a theoretical threat to the industry. I’ve already seen CDR suppliers decide to relocate one of their deployments out of the US because of political instability. I expect to see many more in the coming years.

Has this administration's so far ambiguous stance on the carbon market accelerated the inevitable, by prompting other governments to take a more active role in shaping and supporting the voluntary carbon market?

I hope so! Irrespective of the politics, the harms due to climate change are still occurring. We need leadership to shape and drive this industry. That has been the US for the last 4 years. But if they decide to cede their position as the frontrunners in CDR, then we need other countries to step up.

Obviously, the EU has been aggressive in implementing CDR into its climate policy. And there are rumors that more is coming. But I’m also really excited about Canada as a CDR champion. They have a unique mix of natural resources, engineering expertise, and strong CDR champions within government that positions them nicely to excel at CDR. But we will have to see how much of the talk translates into action.

How is Congress currently approaching carbon removal, and do you anticipate greater legislative engagement or support emerging from recent hearings, budget negotiations, or proposed bills?

My assumption has been that we will see very little on CDR from Congress. But my friends at the Carbon Removal Alliance and Carbon180 are pushing hard to prove me wrong. There may still be policy opportunities on the horizon: integrating CDR into heavy industry, developing quality standards and MRV, R&D resources from appropriations, etc.

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Luckily, there are still CDR champions in Congress. But it's unclear which of these efforts will make it across the finish line.

As some carbon removal projects and companies begin shifting operations outside the U.S., what impact might this have on the structure, credibility, and momentum of the voluntary carbon market?

My biggest concern would be a loss of momentum. CDR is at the critical demonstration phase, where the most important thing is that projects get built. It’s time for us to show the world that these technologies work and have a path to doing so at scale. The pullback in federal support could mean that some of these projects are cancelled or become further delayed due to financial uncertainty.

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The CDR industry has also been laudable in its effort to develop new technologies that can solve historical issues that are common in carbon markets: measurability, high durability, clear additionality. If the market becomes more risk-averse, it may shift resources to approaches that are easier to deploy but have much less clear atmospheric impacts. I personally would see this as a loss, since generating climate impacts is more important than shipping empty credits.

At Carbon Unbound East Coast, you joined a panel on the growing need for more carbon removal buyers. Could you walk us through the key points of that discussion?

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Did any of the insights challenge your thinking or particularly resonate with you?

Science tells us we need to prioritise emissions reductions, but that we also cannot meet our net-zero goals without carbon removal, including nature-based carbon removals. We need investment today to ensure the scale of removals the world will need in the future. At the moment, uncertainty around project quality, policy, voluntary standards, and the internal business case, as well as the complexity of navigating the market, is keeping buyers on the sidelines. Given the challenges of developing these projects, as well as the reputational risk of supporting the wrong projects, the perceived risk of action currently outweighs the risk of inaction. 

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We need to change this paradigm. The CDR community has a role to play in clarifying that all credible, science-based carbon removal pathways are needed, that all projects - engineered, nature-based, and in-between - have risk, that we should celebrate companies who are willing to act now with high integrity, and that we should support learning along the way. We are in the early days of this market and need to change the narrative from one of calling out buyers when things go wrong to celebrating when buyers take action on the emissions they are unable to reduce today and praising them for transparently sharing what works and what doesn’t. That narrative shift would go a long way towards addressing concerns around reputational risk and bringing more companies off the sidelines. 

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Symbiosis Coalition hopes to address the uncertainty stalling the market by signalling demand, clarifying what high-integrity nature-based carbon removal looks like, simplifying procurement for buyers and developers through a joint RFP, and transparently sharing lessons learned along the way to empower other buyers, developers, and investors to act. 

How would you characterise the current state of demand for carbon removal?

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Despite the outcome of the U.S. election, demand appears to remain strong. Some forecasts even suggest that a slower energy transition could accelerate demand for CDR. How are you interpreting these dynamics?

We see that leading U.S. multinational companies, such as those in Symbiosis Coalition, are still committed to high-integrity carbon removal. We also see European and Asian buyers and actors moving forward, even viewing the slowdown in U.S. federal action as an opportunity to step up and demonstrate leadership. 

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SBTI seems to be moving in the right direction, in terms of motivating companies to start investing in carbon removal now. They could do more to encourage companies to address unavoidable ongoing emissions in the near term with high-integrity carbon removals, both nature-based and engineered. The sooner SBTI can make decisions the better for driving climate action now from companies who are waiting to act until they see where SBTI lands.

What are the top three sources of uncertainty in the carbon removal market that you see as most significant in holding buyers back?

The top three sources of uncertainty in the carbon removal market that are most significant in holding buyers back are:

1. Uncertainty about what good looks like
2. Uncertainty about voluntary standards
3. Uncertainty about policy

If we can clarify these three sources of uncertainty in a way that supports near-term investment in carbon removal, it would go a long way towards increasing demand.

The Global 1000 CDR Challenge launched against the backdrop of a shifting U.S. political landscape and unclear signals from the Trump administration. How are corporate buyers interpreting these cues, and how is the evolving political climate shaping their commitment to large-scale carbon removal?

It’s definitely not helping them to champion CDR or build a case for CDR purchases internally – buyers are already lacking a business case for purchasing carbon removal. When you add the uncertainty of the political landscape to the mix, it becomes even more of a wait-and-see topic. It was encouraging to see J.P. Morgan’s purchase announcement this week, further cementing their leadership and strategic interest in the carbon removal space. 

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That said, while the withdrawal of U.S. federal backing has certainly impacted the development of CDR projects within the United States, especially regarding the provision of the right subsidies and incentives to develop projects, it has opened up significant opportunities in other regions. 

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The EU, Canada, the UK, and APAC are all stepping up to fill the void, accelerating regulation, subsidies for project development, and policy enforcement mechanisms to help foster broader market adoption of CDR. In fact, despite the uncertain political landscape in the US, 2025 is shaping up to be the best year for CDR to date. 

How are you driving demand through the Global 1000 CDR Challenge? Could you walk us through your approach step by step?

The Global 1000 Challenge has been developed to address a gap in companies’ journeys to ensure a Paris Agreement-aligned pathway. By calling on the world’s largest 1000 listed companies to enter a spot or forward purchase agreement for 1000 tonnes or more of durable CDR offtakes in 2025. If realised, this collective target would generate one million tonnes of new demand for CDR over the space of 12 months.

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The G1K Challenge has been designed to lower the threshold for companies to meaningfully engage in the CDR market, eliminating some of the internal barriers to entry that have slowed adoption. We have achieved this by changing the rationale, from changes in business strategy, to one tied to competition. What’s more, all the companies that meet the G1K Challenge criteria gain unrivalled access to ClimeFi’s unique market intelligence and procurement services, enabling buyers to easily engage with the CDR market.

This emerging culture of green hushing - where buyers are active yet discreet - seemingly counteracts concerns around mistaken or irrational accusations of greenwashing. In your view, will a quiet, head-down approach ultimately benefit the U.S. carbon removal industry long-term?

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Or is it imperative for buyers to be more vocal about their commitments for global momentum to build?

It’s imperative that buyers are more vocal about their commitments. It’s important for companies to see peers engaging in carbon removal – it creates a healthy dynamic that fuels other companies to get into the industry. If you know your biggest competitor is engaging, it will be sure to make you think twice. Once a company publicly announces an investment in carbon removal, it can create a powerful ripple effect. Competitors worry that they will be left behind. 

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I have talked to many suppliers who have said, of course, securing a large offtake with Microsoft is great, but we would love to see diversified demand. Even a small offtake would go a long way to show investors there is a market. In this respect, early buyers can have an outsized impact on the market.  

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This diversification is crucial for attracting the capital required to scale the market. Without visible movement in the market, investor confidence can remain muted, stifling innovation and the deployment needed to meet global climate targets. Taking a ‘quiet’ approach risks delaying the momentum that CDR needs. 

Does alignment with the SBTi remain the strongest lever for securing board-level support for investments in durable carbon removal solutions?

While the SBTi is vital for emissions reductions, its focus is less on durable carbon removal, although the recent update was promising. This slightly limits its power to secure significant board-level investment in this area. 

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The Oxford Net Zero principles, however, potentially provide a stronger lever by explicitly integrating high-quality, durable removal as essential for net-zero. They offer a clearer strategic rationale, enabling boards to view these investments as crucial for long-term climate leadership and de-risking their climate strategies.

How is the updated 2025 SBTi standard expected to shape carbon removal demand, particularly among corporate buyers in emerging markets?

In recognising the role that carbon removals have to play in reaching net-zero targets, the SBTi’s updated Corporate Net-Zero Standards could significantly drive demand for CDR – and in particular, durable CDR. Ultimately, Chief Sustainability Officers (CSOs) still need to be able to justify the question: Why should we purchase CDR? And if the standard that the company has chosen to follow mandates the incorporation of CDR, that is reason enough. 

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As CDR.fyi reported at Carbon Unbound, only 0.6% of SBTi-aligned companies have purchased carbon removals. This clearly shows that there needs to be a stronger mandate. 

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The Oxford Net Zero principles can complement the SBTi update by guiding companies on how to engage with CDR. They emphasise high-quality, durable, and responsibly deployed solutions; a crystal clear approach, and one that the science will increasingly shift towards as the market moves forward.