Scaling the CDR market
Scaling potential
Deployment of CDR at gigaton-scale is unavoidable in addition to rapid industry decarbonisation, if net zero is to be achieved according to the IPCC. Current durable CDR capacity is under 0.01 gigatonnes, and in line with the IPCC’s AR6 mitigation estimates, it needs to reach approximately 10t Gt of CO₂ per year by 2050. While the market is still nascent, there are hundreds of durable CDR companies developing their technologies and launching first-of-a-kind projects. For more information on the role of CDR for achieving net zero read here.
The path to a gigatonne scale
Building up large-scale volumes of durable CDR in 2040 or 2050 requires investment in different technologies today. Support for scaling the CDR market includes enabling policy, investors’ commitment, industry readiness to decarbonize, and a demand signal from the carbon markets.
Early buyers of durable CDR credits are a catalyst for emerging technologies and at the same time they benefit from ensuring future supply, readiness for upcoming regulation and strengthening credible net-zero commitments.
The industry is driven forward by numerous market players, including project developers, carbon standards, marketplaces, CDR associations, climate investors, corporate buyers and non-profit organizations.
Credibility of claims
Highly durable CDR with reliable digital MRV and real-time measurements provides early buyers and investors the certainty and credibility the legacy VCM market was lacking. Neutralizing fossil emissions remaining in the atmosphere for hundreds to thousands of years, with durable CDR of the same permanence and timescale, protects corporate climate mitigation and net-zero claims against reputational and greenwashing risks.
Enabling environment
- Durable CDR will take a central place in the upcoming revision of the SBTI's Corporate Net Zero Standard.
- EU Carbon Removals and Carbon Farming Regulation (CRCF) sets world's first voluntary standard for durable CDR. The upcoming EU Buyer's club will coordinate private investment. National support schemes and durable CDR in EU 2040 climate targets help scale the market.
- Inclusion of durable CDR in compliance markets e.g. EU ETS will ensure that the market scales extent needed to neutralize residual emissions in a net-zero world.
- The Industrial Accelerator Act will boost demand for low-carbon products produced in the EU e.g. CO₂ mineralization.
