What Is Carbon Dioxide Removal? Top Buyers and Sellers of CDR Credits in 2024

Jennifer L
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0
What Is Carbon Dioxide Removal? Top Buyers and Sellers of CDR Credits in 2024

The world must remove 5–16 billion metric tons of CO₂ annually by 2050 to limit global warming to 1.5°C. But with emissions still rising, can we scale Carbon Dioxide Removal (CDR) fast enough to make a real impact?

What Is CDR? Understanding Carbon Dioxide Removal Credits

Carbon dioxide removal includes technologies and natural methods that capture and store CO₂ from the air. CDR is crucial for achieving global climate goals, as reducing emissions alone is not enough to limit global warming.

The Intergovernmental Panel on Climate Change (IPCC) says that to keep global warming under 1.5°C, we need to remove 5–16 billion metric tons of CO₂ each year by 2050. 

CDR credits let companies and governments balance their emissions. They do this by funding projects that actively remove CO₂. CDR credits are different from traditional carbon offsets.

While carbon offsets aim to reduce or avoid emissions, like stopping deforestation, CDR credits guarantee that CO₂ is pulled out of the air and stored for a long time. The voluntary carbon market (VCM) is expected to grow from $2 billion in 2023 to over $50 billion by 2030, with CDR credits playing a significant role.

How Does CDR Work? The Science Behind Carbon Removal

CDR captures CO₂ from the air. It then stores it permanently in geological formations, biomass, or other stable places. There are two main types of CDR methods:

  • Natural CDR: Includes afforestation, soil carbon sequestration, and ocean-based methods.
  • Technological CDR: Includes Direct Air Capture (DAC), biochar, and enhanced mineralization.

Permanence is key in carbon dioxide removal. High-quality CDR credits must keep CO₂ stored for centuries or even millennia. This prevents it from being released back into the atmosphere.

Recent research shows that engineered carbon removal solutions like DAC can store carbon for over 1,000 years. This makes them very effective for long-term carbon management.

Several global projects are currently implementing these solutions. In Iceland, the Orca plant by Climeworks is the largest DAC facility, capturing 4,000 metric tons of CO₂ per year, with plans to scale to 1 million tons annually by 2030.

In the U.S., the Department of Energy has committed over $3.5 billion to support DAC projects under the Regional DAC Hubs initiative.

The CDR Market: Who Buys Carbon Removal Credits and Why?

The CDR market is growing fast. Corporate buyers, governments, and voluntary markets are boosting demand. 

In 2024, purchases of high-durability CDR credits reached almost 8 million metric tons, compared to 4.5 million metric tons in 2023 as shown in the chart. This represents an increase of approximately 78% year-over-year, according to the CDR.fyi report.

Durable carbon removal credits CDR purchases 2024
Source: CDR.fyi report

Key players in the market include:

  • Microsoft accounted for 63% of total CDR purchase volume in 2024 to achieve carbon negativity by 2030. The tech giant secured around 5.1 million metric tons of durable CDR credits.
  • Google purchased about 501 thousand tons of CDR credits, making it second to Microsoft.
  • Frontier buyers—including Stripe, Shopify, and Watershed—continued to support promising carbon removal projects, collectively purchasing 667.4K tonnes of CDR credits.
CDR Top10 Purchasers 2024
Source: CDR.fyi report

Market trends show that demand will keep rising. More companies are setting science-based climate targets. However, the supply of high-quality CDR credits remains limited, leading to a significant price premium. High-durability CDR credits cost between $100 and $600 per ton. The price varies based on the technology used.

Companies in hard-to-abate industries, such as aviation, cement, and steel production, are becoming major buyers. The aviation sector is predicted to need 300 million tons of carbon removals each year by 2050. This is to meet the net-zero goals of CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation).

CDR Suppliers: Who Is Leading the Charge?

Several companies and organizations are at the forefront of scaling carbon dioxide removal solutions. These suppliers are focused on cutting costs. They also aim to boost efficiency and make high-quality carbon removal credits more available. 

CDR Top10 Suppliers 2024
Source: CDR.fyi report

Top CDR credit suppliers in 2024 per CDR.fyi data include:

  1. Stockholm Exergi leads in BECCS (Bioenergy with Carbon Capture and Storage), securing large offtake deals, including a 3.3 million-tonne sale to Microsoft, the largest CDR transaction to date.
  2. Ørsted, another Scandinavian utility, expanded its presence by adding a 1 million-tonne deal with Microsoft and a 330K-tonne sale to Equinor, strengthening its position in large-scale carbon removal.
  3. 1PointFive, backed by Occidental Petroleum, remains the largest supplier in DAC, securing a 500K-tonne sale to Microsoft through its Stratos project.
CDR credit sales by supplier 2024
Source: CDR.fyi report

New startups are on the rise. In 2024, venture capital investments in CDR totaled $836 million, a 30% decline from 2023’s $1.2 billion. Despite this, the number of investments and average deal sizes increased when excluding large outlier transactions from previous years.

The new suppliers are important in tackling some of the major challenges faced by the market. 

Challenges of CDR: Cost, Scalability, and Greenwashing Risks

Like other markets, CDR has to deal with various issues to keep growing. Here are the major challenges it is currently facing:

  • High Costs

DAC and other engineered solutions remain expensive, with costs ranging from $100 to $600 per ton of CO₂ removed. However, with economies of scale and technological advancements, costs are projected to decrease by 40% by 2035.

  • The U.S. Department of Energy has set a target of reducing DAC costs to below $100 per ton by 2050 through increased investment and innovation. 

Climeworks and Carbon Engineering are focused on improving energy efficiency. This helps reduce costs quickly. 

Additionally, new funding models, such as advanced market commitments (AMCs) like Frontier, are being explored to help scale CDR. These commitments are like those for vaccines. Big companies and governments promise to buy CDR credits in the future at fixed prices. This method helps developers gain financial stability. It also encourages more investment in carbon removal technologies.

  • Scalability

The current supply of high-quality CDR credits is much lower than demand. In 2023, only 2.4 million metric tons of CO₂ were removed, a fraction of the estimated 5–10 billion metric tons per year needed by 2050.

To scale to gigaton levels, we need more than just tech upgrades. We also need to expand our infrastructure a lot. The land, energy, and storage requirements for engineered solutions like DAC remain a major challenge. For example, capturing 1 billion tons of CO₂ annually using DAC would require approximately 50 terawatt-hours (TWh) of energy, equivalent to the yearly electricity consumption of Spain. 

Nature-based solutions, while more cost-effective, also face scalability issues. Afforestation and soil carbon storage need millions of acres. This can compete with farming and protecting biodiversity. Moreover, measuring and verifying long-term storage remains an ongoing challenge.

  • Greenwashing Risks

Some companies buy cheap CDR credits. They claim these help the climate but they don’t actually reduce emissions. This issue is particularly concerning in the voluntary carbon market, where transparency and accountability vary across different registries.

Investigations revealed that up to 30% of voluntary carbon offsets might not provide the promised reductions. This can happen because of overestimation or lack of permanence. 

To combat greenwashing, organizations like Verra, Gold Standard, and the Integrity Council for the Voluntary Carbon Market (IC-VCM) are introducing stricter guidelines for credit verification. Third-party audits and blockchain tracking systems are being created. They aim to boost transparency and trust in the market.

CDR Policies and Regulations: What You Need to Know

Governments are increasing support for carbon dioxide removal through funding, tax incentives, and regulations. The U.S. Inflation Reduction Act (IRA) provides up to $180 per ton for DAC projects, making the U.S. one of the leading funders of carbon removal technologies. 

The Department of Energy’s Carbon Negative Shot program also aims to reduce the cost of CDR to under $100 per ton. It plans to deploy scalable solutions by 2035.

The EU is developing the Carbon Removal Certification Framework (CRCF) in Europe. This framework will set quality standards for CDR projects. It will ensure that carbon removals are measurable, additional, and durable. With this, the European Commission launched a €1 billion fund for carbon removal. This will help support new and innovative projects.

Beyond the U.S. and EU, other countries are exploring similar regulatory approaches:

  • Canada has integrated carbon removal into its Clean Fuel Regulations, encouraging industries to invest in verifiable CDR solutions.
  • Japan has launched a Carbon Credit Market, with an emphasis on nature-based removals and early-stage DAC investments.
  • Australia is expanding its Carbon Farming Initiative to include engineered removals, providing subsidies for companies investing in long-term carbon storage.

Organizations such as Verra, Gold Standard, and Puro.earth are working to improve verification and ensure credibility in the CDR market. The Science Based Targets Initiative (SBTi) has also begun including engineered CDR in net-zero pathways, signaling further institutional support for scaling the industry.

As these policies and regulations develop, they will play a crucial role in shaping the future of CDR by ensuring market integrity, funding innovation, and supporting large-scale deployment.

The Future of CDR: Can It Scale to Meet Net-Zero Goals?

Analysts expect the CDR market to grow a lot. They predict it could reach gigaton-scale removal by 2050. Key drivers of growth include:

  • Technological advancements reduce costs and improve efficiency.
  • Corporate and government commitments increasing demand.
  • Regulatory developments ensure market integrity.

By 2050, DAC could remove up to 1 billion metric tons of CO₂ each year. Nature-based solutions might add another 3 to 5 billion metric tons annually. The overall CDR market could be worth over $100 billion by 2035 as more companies and governments integrate carbon removal into their climate strategies.

While challenges remain, carbon dioxide removal is set to play a crucial role in achieving global net-zero targets. Continued innovation, strong policy support, and increasing corporate investment will determine how quickly and effectively the sector can scale to meet climate goals.

Xpansiv Boosts Transparency in North America’s Renewable Energy Certificate Market. EXCLUSIVE Interview Inside

Saptakee S
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0
Xpansiv Boosts Transparency in North America’s Renewable Energy Certificate Market. EXCLUSIVE Interview Inside

Xpansiv has launched a new data series for North America’s Renewable Energy Certificate (REC) markets. This product merges data from Xpansiv’s CBL spot exchange, Xpansiv Connect™ portfolio system, and OTC prices from Evolution Markets.

This combination offers a clearer view of the market. Users can track individual RECs in both spot and forward markets. They can access key details like RPS status, state, price type, vintage, and registry. This helps users better understand REC trends and market movements.

XPANSIV recSource: Xpansiv

Why Renewable Energy Certificates (RECs) Matter in Clean Energy

Renewable Energy Certificates (RECs) track clean energy from sources like wind and solar. Since renewable electricity mixes with other sources on the grid, RECs help verify and claim renewable energy usage. Many businesses use International Renewable Energy Certificates (I-RECs) to meet their sustainability goals and offset carbon emissions.

Technically, “An I-REC is a tradable certificate representing the environmental attributes of one megawatt-hour (MWh) of renewable energy generation. They are recognized by the GHG Protocol, CDP, and RE100 for reporting Scope 2 emission.”

Xpansiv: Enhancing Market Insights with Reliable Data

Nathan Rockliff, Xpansiv’s Chief Strategy Officer, highlighted the importance of this launch. He noted,

“Xpansiv’s new consolidated REC data product harnesses our comprehensive market infrastructure to provide an unmatched, detailed view of the REC markets. This offering is the first of our enterprise-wide initiatives to enhance the utility, integrity, and coverage of environmental commodity data, accelerating the global energy transition and driving real impact.”

The platform offers daily insights into more than 120 REC types across seven ISOs. It includes executed trade data, firm orders from CBL, and indicative prices from Evolution Markets. Historical data dating back to 2019 adds depth and accuracy. With Xpansiv Connect, users can track both spot and forward REC instruments in real-time, improving market visibility.

CBL Overview

xpansiv cbl
Source: Xpansiv

Record-Breaking REC Trading Volumes

This launch comes at a time of peak REC trading activity. In 2024, more than three million RECs were exchanged on CBL—an 18% jump from the previous year. January alone saw transactions exceed $27 million, setting a new record.

Xpansiv’s REC data is now available through its API, web platform, and third-party data partners, making it easier than ever for market participants to access critical insights.

EXCLUSIVE: 

The CarbonCredits team connected with Xpansiv to explore their REC data product in greater detail. An Xpansiv spokesperson provided valuable insights worth noting.

CC: What makes Xpansiv’s consolidated REC data product a game-changer for market participants?

Xpansiv: We designed the new consolidated data product to bring a new level of robustness and utility to REC data by combining spot and forward market data, with unique instrument identifier reference data. Integrated unique identifiers enable multi-sourced trade, order, and indicative spot and forward prices to be mapped to a single instrument.

With that improvement, RECs can be modeled precisely by spot/forward price, vintage, RPS, registry, and other attributes, which is difficult to do with legacy data formats.

CC: How is Xpansiv leveraging Evolution Markets’ spot and forward prices to enhance REC market insights?

Xpansiv: Spot and forward prices are essential inputs into a REC data series. Sourcing that data from recognized market leader- Evolution Markets ensures that the prices are the product of a rigorous assessment process over a broad range of RECs. Further ensures continuity for the new product’s five-year historical data series.

The new product includes Evolution Markets data as well as firm order and trade prices from the CBL spot exchange.

In 2024, CBL’s REC market traded a total of 3.15 million MWh, an 18% increase. The notional value traded was $158 million, a 41% jump.

Lastly, but importantly, the new data series is built using unique instrument identifiers from the Xpansiv Connect portfolio management system. Xpansiv Connect is integrated with 14 REC and carbon registries and has issued more than a billion instrument identifiers since launch.

The careful consolidation of those three diversified market and reference data sources is what makes the new data product so powerful and useful.

CC: Why are CBL REC trading volumes surging, and what does it mean for the future of renewable energy markets?

Xpansiv: CBL REC volumes are growing because the exchange and its post-trade Xpansiv Connect portfolio management system provide real credit, liquidity, and operational benefits to market participants.

Xpansiv’s CBL spot exchange provides direct access live, firm bids and offers, instant execution, and automated, T+0 settlement, through direct integrations with leading REC registries.

OTC market participants settle trades via the exchange for two primary reasons.

The first is trades can be settled between CBL participants without bilateral trading or credit counterparty agreements.

The second is, as with exchange-matched trades, CBL’s post-trade infrastructure provides automated settlement for OTC trades, speeding settlement cycles and reducing errors and failures.

CC: If the US REC market hits $40 billion by 2033, how will Xpansiv’s data innovation fit into this growth?

Xpansiv: The US REC markets, and, in fact, REC markets globally, are projected to grow sharply from both traditional sectors as well as significant demand to support the proliferation of new data centers being driven by the artificial intelligence boom.

High-integrity markets and reference data are integral parts of successful commodity and financial markets. Our institutional-grade infrastructure is built to enable environmental commodity markets to scale, which we think is essential to attain a timely energy transition.

The new consolidated REC data product is the first of our enterprise-wide initiatives to enhance the utility, integrity, and coverage of environmental commodity data, accelerating the global energy transition and driving real impact.

That goes for established REC and carbon markets, as well as nascent markets in sustainable aviation fuel, or SAF, energy, and recycled plastics, to name a few that we’re working on.

Xpansiv’s Role in the Energy Transition

Xpansiv operates a leading market infrastructure for environmental commodities, including carbon credits and RECs. It also manages registry systems for energy and environmental markets and oversees North America’s largest independent solar renewable energy credit trading platform.

It provides advisory and transaction support in carbon, renewable energy, and energy transition markets through its Carbon Financial Services and Evolution Markets divisions. Xpansiv Connect™, its multi-asset environmental portfolio management system, further enhances data transparency, supporting the industry’s push for accountability in sustainability efforts.

Strong Investor Support

Xpansiv’s investor base includes Blackstone Group, Bank of America, Goldman Sachs, Aramco Ventures, Macquarie Group Ltd., S&P Global Ventures, Aware Super, BP Ventures, Commonwealth Bank, and the Australian Clean Energy Finance Corporation.

Source: Xpansiv Launches Consolidated Renewable Energy Data Product, Setting a New Standard for REC Market and Reference Data – Xpansiv

SolarBank Expands Community Solar in New York with 14.4 MW Project

Saptakee S
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0
SolarBank Expands Community Solar in New York with 14.4 MW Project

Disseminated on behalf of SolarBank Corporation.

SolarBank Corporation (NASDAQ: SUUN; Cboe CA: SUNN, FSE: GY2) recently announced the development of two community solar projects in Skaneateles, New York. These ground-mount solar projects, located in Onondaga County within the Finger Lakes Region, will generate 14.4 MW DC, enough to power 2,100 homes.

SolarBank Secures Key Approval to Expand Community Solar in New York

The press release revealed that the projects have successfully completed the Coordinated Electric System Interconnection Review (CESIR). This positive interconnection result is a major step forward to make the project successful. With interconnection approval in hand, the company can now focus on the ongoing permitting process.

These projects will have to qualify for New York State Energy Research and Development Authority’s (NYSERDA) NY-Sun Program incentives. Such incentives are vital for promoting solar initiatives and making renewable energy more accessible in New York.

Next, SolarBank will secure the permit, finalize financing, and then begin construction. Once underway, both projects will serve as community solar installations, supplying clean energy to the local power grid.

                                 North American Growth Strategy

SolarBank community solar
Source: SolarBank

Risks and Considerations

Despite progress, the projects face several risks. Solar development relies on three key factors: getting permits, finalizing community solar contracts, and securing third-party financing. Changes in government policies or cuts to renewable energy incentives can impact the long-term success of these projects.

The company understands these risks and remains dedicated to expanding its clean energy footprint. Notably, it is actively monitoring policy changes and market conditions to ensure project feasibility.

Community Solar: Affordable Clean Energy for Everyone

Community solar is a shared renewable energy model. It allows multiple users to benefit from a single solar project. Instead of installing panels on their own property, participants subscribe to an off-site solar farm and earn credits on their electricity bills. This model makes clean energy more affordable for homeowners, renters, businesses, and communities.

Who Benefits?

  • Homeowners, renters, and apartment dwellers without suitable rooftops

  • Businesses, nonprofits, and government entities acting as “anchor tenants”

  • Low- to moderate-income households unable to afford rooftop solar

community solar
Source: NREL

2028 Forecast

A 2024 NREL study found that 42% of U.S. households and 44% of businesses lack access to rooftop solar. This makes community solar a crucial alternative for stabilizing electricity costs, strengthening the power grid, and creating local jobs.

As of June 2024, the U.S. had about 7.87 GW of community solar in 44 states and D.C. Yet, around 73% of this capacity is in just four states: Florida, New York, Massachusetts, and Minnesota.

Florida tops the list with 2,085 MW-AC. New York follows with 1,764 MW-AC, then Massachusetts with 1,014 MW-AC, and Minnesota with 910 MW-AC.

Wood Mackenzie and the Coalition for Community Solar Access (CCSA) predict the national market will surpass 10 GWdc by 2026 and reach 14 GWdc by 2028.

Annual installations have stayed steady at around 1 GWdc for three years, with an average growth rate of 8% projected through 2028. This indicates that this segment is one of the fastest-growing in the U.S. solar market.

community solar

SolarBank Fuels Community Solar Growth in America’s Clean Energy Shift

SolarBank has been key in expanding community solar with large renewable energy projects. The company has a development pipeline exceeding one gigawatt and over 100 MW of completed projects. This makes SolarBank a top clean energy provider in North America.

Going back in 2018, SolarBank started four community solar projects that operated commercially with a total capacity of 10.2 MW, DC

In 2023, it sold 21 MW of community solar sites in Upstate New York to Honeywell International for US$41 million. SolarBank created these projects through an EPC agreement. This ensured they will construct them to commercial operation and meet the requirements for NYSERDA incentives.

  • As reported by Business Insider, the North American solar PV market, valued at $25.02 billion in 2019, was projected to reach $120.74 billion by 2027, growing at a CAGR of 21.7%.

SolarBank boosts growth through solar projects, Battery Energy Storage Systems (BESS), and EV charging. The company delivers clean energy to utilities, businesses, municipalities, and homes. This shows its commitment to a sustainable energy future.

SolarBank
Source: SolarBank

Community solar is growing fast. It helps more people save on energy bills and supports a cleaner power grid. SolarBank’s latest project boosts this trend. Each project pushes renewable energy ahead, making solar easier to access across North America.

This article contains forward-looking information. Please refer to the SolarBank press release entitled “SolarBank Provides Update on 14.4  MW Projects in Skaneateles, New York.”

Disclosure: Owners, members, directors, and employees of carboncredits.com have/may have stock or option positions in any of the companies mentioned: SUUN.

Carboncredits.com receives compensation for this publication and has a business relationship with any company whose stock(s) is/are mentioned in this article.

Additional disclosure: This communication serves the sole purpose of adding value to the research process and is for information only. Please do your own due diligence. Every investment in securities mentioned in publications of carboncredits.com involves risks that could lead to a total loss of the invested capital.

Please read our Full RISKS and DISCLOSURE here.

Chestnut Carbon Lands $160M to Supercharge Nature-Based Carbon Credit Market

Jennifer L
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0
Chestnut Carbon Lands $160M to Supercharge Nature-Based Carbon Credit Market

Chestnut Carbon, a nature-based carbon removal company, has raised $160 million in Series B financing. This funding will help expand its afforestation projects across the United States. 

With strong investor backing, the funds will accelerate Chestnut’s mission to deliver large-scale carbon removal, setting a new standard in the voluntary carbon market (VCM).

Nature-Based Carbon Removal: A Booming Market

Nature-based carbon removal solutions are key to fighting climate change. Afforestation and reforestation play a big role in this effort. The global market for nature-based carbon credits could grow a lot soon. 

McKinsey reports that by 2030, demand for voluntary carbon credits may hit 1.5 to 2 gigatons each year. Nature-based solutions will likely play a big role in this growth.

Analysts estimate that the global carbon credit market could reach $100 billion by 2030 and $250 billion by 2050. Nature-based solutions could contribute a major share. 

carbon credit market value 2050 MSCI

As companies aim for net-zero targets, the need for verified carbon credits is growing. This trend highlights the role of Chestnut Carbon. The company commits to creating large, nature-based carbon removal projects.

Chestnut Carbon’s $160M Funding: A Game Changer

The $160 million funding round has existing investors, like Canada Pension Plan Investment Board. It also includes new investors, Cloverlay and DBL Partners. Additional support came from limited partners of Kimmeridge, Chestnut’s founding firm. These partners include university endowments, family offices, and institutional investors.

This funding will help Chestnut Carbon grow its Sustainable Restoration Project. The goal is to sequester 100 million metric tons of carbon over time.

Chestnut promotes biodiversity and supports ecosystem health by turning degraded farmland into forests. This work also makes a big difference in the VCM.

Chestnut’s Approach to Carbon Removal: Turning Land Into a Carbon Goldmine

Chestnut Carbon started in 2022 and focuses on afforestation. This means planting trees on unused farmland and pasture with the goal of capturing and storing carbon. The company distinguishes itself with these:

  • Land Acquisition: Chestnut has acquired more than 35,000 acres in six U.S. states. These include Arkansas, Louisiana, Alabama, Mississippi, Oklahoma, and Texas.
  • Gold Standard® Verified Carbon Credits: These credits meet strict quality and integrity standards. This makes them appealing to companies focused on sustainability.
  • Chestnut uses special data tools and growth models. These help improve forest development and capture carbon effectively.
  • Long-Term Sustainability: The company aims to create lasting, strong forests. These forests do more than store carbon. They also help restore soil, retain water, and protect biodiversity.

How the funding will be used

With the new $160 million, Chestnut Carbon will speed up its growth in three main areas:

  1. Land Purchases: More land acquisitions will enable rapid expansion and project execution.
  2. Technology Investment: Chestnut uses advanced data modeling and their own tech to track tree growth. This helps predict carbon sequestration rates and makes project development easier.
  3. Talent Growth: The company will grow its team of experts in forestry, environmental science, carbon finance, and land management. This will help scale operations effectively.
Chestnut Carbon projects
Examples of Chestnut Carbon afforestation projects

Investors see Chestnut Carbon as a leader in the emerging nature-based carbon removal sector. Nancy Pfund, Founder and Managing Partner at DBL Partners, highlighted the promise of Chestnut’s model, saying:

“With our investment in Chestnut, we see the potential to raise the bar by helping to create the industry leader in providing high-quality carbon offsets at scale.”

Remarking on this massive fundraising, Ben Dell, CEO of Chestnut and Founder and Managing Partner of Kimmeridge noted:

“The Series B financing allows us to continue to build out our platform to meet the growing needs of sustainability-conscious organizations and advance our position as a leading provider in the international carbon markets.”

The Corporate Shift Toward Carbon Offsets

Chestnut Carbon is growing because more companies need high-quality carbon credits for their increasing corporate commitment to sustainability.

Companies in technology, manufacturing, and finance are investing in carbon offsets. They want to reduce their environmental impact and reach net-zero emissions.

In 2023, carbon pricing revenues hit a record $104 billion. This shows that more companies are using carbon credits for sustainability.

revenue per type of carbon pricing 2017 to 2023
Source: World Bank report

Microsoft leads the way by buying over 3.3 million tons of carbon removal credits. This is part of its goal to be carbon-negative by 2030. The tech giant recently signed a deal to buy 7 million carbon credits from Chestnut. 

Microsoft announced a big deal to help restore parts of the Brazilian Amazon and Atlantic forests. They will buy 3.5 million carbon credits from Re.green, a Brazilian start-up, over the next 25 years. This initiative seeks to reduce greenhouse gas emissions. These emissions are rising because AI and data centers need more energy.

Other major corporations are also making substantial investments in carbon credits. Delta Air Lines has bought millions of carbon credits. This helps offset its emissions. It shows the airline industry’s commitment to sustainability.

Also, companies like Alphabet (Google’s parent) and Disney are big buyers of carbon credits. Shell topped the list, followed by Microsoft last year. 

In 2024, the voluntary carbon market was very active. Corporations used credits valued at $1.4 billion. This is just below 2022’s peak of $1.7 billion. It shows that companies are still committed to carbon-offsetting efforts.

These investments help companies reach their sustainability goals. They also aid global efforts against climate change. By backing projects that cut greenhouse gas emissions, corporations are key players in moving toward a sustainable future.

The Challenges Ahead—Can Chestnut Fix It?

Big afforestation efforts could help. However, challenges still exist in expanding nature-based carbon removal solutions, including:

  • Land Availability: Securing large tracts of suitable land remains a key hurdle.
  • Verification Delays: The carbon market often has slow verification processes. This can delay credit issuance and affect project financing.
  • Market Maturity: The voluntary carbon market is still growing. It needs clearer standards and stronger buyer trust in credit quality.

Chestnut focuses on careful checks, quality credits, and sustainable practices. This helps them face challenges effectively. This approach sets a standard for future nature-based carbon removal projects.

Chestnut Carbon’s $160 million fundraising is a big milestone for the voluntary carbon credit market. As companies aim for net-zero goals, they will need more trusted, high-quality carbon credits. Chestnut’s approach sets a new standard in the carbon market, opening doors for large, sustainable solutions to remove emissions. 

Albemarle’s Q4 Loss Reflects Lithium Slump, Yet Net Zero and Sustainability Stay on Track

Saptakee S
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0
Albemarle’s Q4 Loss Reflects Lithium Slump, Yet Net Zero and Sustainability Stay on Track

Albemarle Corporation (NYSE: ALB) the world’s top lithium and specialty chemicals producer posted its financial results for Q4 and the full year of 2024. Despite lower lithium prices, the company reduced costs and improved operations to remain competitive.

Strong efficiency measures helped in profitability but adjusted earnings did not meet analyst expectations. Like many other lithium players, Albemarle also faced a lithium supply glut mainly due to overproduction in China.

Kent Masters, chairman and CEO of Albemarle, expressed himself by saying,

“We are taking decisive actions to reduce costs, optimize our conversion network, and increase efficiencies to preserve our long-term competitive position. As we look ahead, we expect dynamic market conditions to persist but remain confident in our ability to deliver value to stakeholders by increasing our financial flexibility, strengthening our core capabilities, and positioning Albemarle for future growth.”

Albemarle Reports Loss and Challenges for Q4

Albemarle ended Q4 2024 with $1.2 billion in revenue and a net income of $75 million, or $0.29 per diluted share. However, the adjusted diluted loss per share was $1.09.

Albermarle earnings
Source: Albermarle

Energy Storage Hit by Lower Lithium Prices 

Energy Storage, Albemarle’s largest segment, saw Q4 sales of $617 million, a 63% drop from the previous year. This decline came from a sharp 53% drop in lithium prices. Sales volumes also fell by 10%. Plant outages and the timing of spodumene sales played a role in this situation.

However, adjusted EBITDA rose $290 million to $134 million, supported by lower spodumene costs and the absence of a $604 million charge recorded in Q4 2023.

Specialties and Ketjen Disappoint 

Albemarle’s Specialties segment reported sales of $333 million, down 2% from last year. Adjusted EBITDA increased by $43 million to $73 million. This rise came from cost-saving measures and higher market demand. In contrast, the Ketjen business, which makes catalysts, saw a 17% drop in sales to $282 million, mainly due to lower volumes.

Full-Year Performance

For the entire 2024, Albemarle made $5.4 billion in revenue. Energy Storage volumes grew by 26%. However, restructuring costs resulted in a net loss of $1.2 billion, or $11.20 per diluted share.

As the company aimed for efficiency, it achieved $1.1 billion in adjusted EBITDA and generated $702 million in operating cash flow. This success came from strong cost controls and effective working capital management.

2025 Outlook and Strategic Moves

Albemarle is taking proactive steps to manage changes in the lithium market. They are tightening spending and improving efficiency. The energy storage sector relies heavily on lithium prices. Net sales and profits in the sector may be affected when lithium prices fall.

The company adapts to falling lithium prices by cutting spending and boosting efficiency. It has reached over 50% of its $300-400 million cost reduction goal. Additionally, it improved lithium conversion efficiency at La Negra and Meishan. By mid-2025, the Chengdu site will enter care and maintenance. Meanwhile, Qinzhou will shift some production to lithium carbonate.

It also aims for better financial management and cost savings. This will help ensure resilience in a tough market.

Albemarle 2025
Source: Albemarle

Albemarle’s Net Zero Goals: Leading Lithium Innovation for a Sustainable Future

Albemarle’s advanced processing site in Kings Mountain, North Carolina is crucial for lithium development. It uses cutting-edge technology to refine and convert lithium for energy storage. It also has a top-notch research and development center that focuses on improving battery materials.

The company focuses on producing high-quality lithium. This matters because demand is growing for lithium in EVs, renewable energy storage, and digital technology. It’s constantly improving its processes to make energy storage safer and more efficient. This strategy supports the energy transition and emphasizes Albermarle’s commitment to sustainability.

Energy Storage Product Portfolio

Albemarle lithium
Source: Albemarle

Building a Greener Lithium Industry

As a founding member of the International Lithium Association (ILiA), the company sets global standards for carbon footprint measurement. This covers brine, hard rock, and clay sources. Their work promotes responsible resource management and transparency in the lithium supply chain.

By taking the lead in sustainable lithium production, Albemarle is ensuring that the industry grows in an environmentally responsible way, supporting cleaner energy solutions for years to come.

2030 Carbon Neutral Goals:

Albermarle wants to achieve carbon neutrality across its scope emissions by 2030.

The company aimed to collect primary data from suppliers for 75% of its raw material carbon footprint by 2023, increasing to 90% by 2024, to achieve its Scope 3 reduction target.

Albermarle net zero goals
Source: Albermarle

Sustainability Snapshot 

The company’s 2023 sustainability report highlighted the following achievements:

  • Energy Storage: In 2023, Albemarle cut Scope 2 emissions by using renewable electricity at La Negra and Xinyu. Equipment upgrades at Xinyu improved efficiency, reducing Scope 1 emissions. Amsterdam secured 50% renewable electricity for 2024-2026.

  • Specialties & Ketjen: Lower production kept total emissions on track, but intensity rose as plants operated below capacity. Efficiency optimization remains a priority.

  • Bromine Sustainability: Completed ISO-compliant product carbon footprint study for Magnolia, Arkansas, verified by EcovaMed, reinforcing sustainable bromine production efforts.

We hope with a strong strategy in place, Albermarle can rebound and hold its ground in terms of both revenue and sustainability for this year.

Gevo and Axens Boost SAF with Innovative Ethanol-to-Jet Technology

Saptakee S
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Gevo and Axens Boost SAF with Innovative Ethanol-to-Jet Technology

Gevo and Axens are joining forces to speed up the development of Sustainable Aviation Fuel (SAF) using the ethanol-to-jet (ETJ) pathway. This partnership aims to improve efficiency, reduce costs, and lower risks by leveraging Axens’ Jetanol™ technology.

They are also enhancing Gevo’s patented ethanol-to-olefins (ETO) technology. This technology converts ethanol into light olefins, which are key ingredients for fuels and chemicals.

Dr. Pat Gruber, Chief Executive Officer of Gevo

“We believe that continuing to reduce production costs and capital costs for drop-in hydrocarbon fuels and chemicals has the potential to create large numbers of jobs, spur rural economic development, and create clear, market-based incentives for regenerative agriculture. It adds up to a practical approach for increased energy production and better energy security. This is a real way forward: it drives costs lower, uses the same, established fuel infrastructure, has proven and auditable improvements in sustainability, including how land is used, and offers large benefits to our society, and, in particular, strengthens our rural communities. We see this can be done, and we are pursuing it. It’s the right thing to do.”

SAF U.S.

Gevo’s Breakthrough in Ethanol-to-Olefins (ETO)

Last September, the U.S. Patent and Trademark Office granted Gevo a patent (U.S. Patent No. 12,043,587 B2) for its ETO process. This patent boosts Gevo’s role in renewable fuels. It protects their advanced catalyst technology that turns ethanol into olefins efficiently.

Gevo and LG Chem have teamed up to scale this process for chemical use. They aim to optimize the technology for commercial purposes. This will create a sustainable alternative to traditional petrochemical olefins.

How the ETO Process Works

Gevo’s ETO process turns ethanol into light olefins. These are key building blocks for fuels and chemicals. Traditional methods first make ethylene. Then, they need extra steps to produce three- and four-carbon olefins like propylene and butenes.

The purpose is to simplify fuel production by making the larger olefins directly from ethanol in a single step. These olefins can then be converted into transportation fuels using proven refining methods.

This innovation improves efficiency, reduces energy use, and lowers costs. Most importantly, it helps achieve zero or even negative carbon emissions, making biofuels more sustainable.

Paving the Way for a Low-Carbon Future

Gevo is committed to cutting carbon emissions through renewable fuels and chemicals. The company operates one of the largest dairy-based renewable natural gas facilities in the U.S. and an ethanol plant equipped with carbon capture technology. It also owns the first production site for specialty alcohol-to-jet fuels.

                                           Gevo’s SAF Technology

GEVO SAF
Source: Gevo

Through its Verity subsidiary, Gevo ensures transparency in sustainability tracking. As global jet fuel demand continues to rise, SAF offers a major opportunity to cut emissions and build a cleaner future.

                                Gevo’s GHG Emissions (2022)

Gevo carbon emissions
Source: Gevo

Axens Unveils Jetanol™ to Boost SAF Production

Axens has introduced Jetanol™, a cutting-edge Alcohol-to-Jet (ATJ) technology, to accelerate SAF production. With a project pipeline approaching 3 million tons (1 billion gallons) per year, this innovation helps fuel producers transition to cleaner, low-carbon energy.

Quentin Debuisschert, CEO of Axens noted,

“The immense potential for both our companies to lead the future of air-travel decarbonization is an obvious way forward. The combination of Gevo market know-how and capacity of project development with Axens’ best-in-class technology, Jetanol™, is expected to allow a fast acceptance and adoption of the ETJ Pathway. The future ETO technology commercialization will keep Axens and Gevo on the cutting edge of the ETJ pathway by offering end-users and project developers the possibility to select the most attractive technology for their situation.”

                                               Jetanol™Axens Jetanol

Global Partnerships to Scale SAF

Axens has partnered with Gevo since 2021 through the Strategic ETJ Alliance. Together, they are advancing SAF production with Gevo’s net-zero technology to cut emissions and Verity Tracking for accurate carbon accounting

This collaboration strengthens the supply chain for low-carbon aviation fuels, bringing the industry closer to its decarbonization goals.

A Game-Changer for the Aviation Industry

Airlines are under pressure to cut emissions and reduce dependence on fossil fuels. Axens is addressing this with SAF technology that turns diverse biomass feedstocks into jet fuel, including:

  • Renewable oils and fats

  • Agricultural and forestry waste

  • Energy crops and woody biomass

  • First- and second-generation ethanol and bio-olefins

Jetanol™ converts ethanol or iso-butanol into SAF, offering a scalable alternative to fossil-based jet fuel. It is already used in five major projects, producing over 1.4 million tons (460 million gallons) annually.

Axens is expanding Jetanol™ globally through strategic partnerships, backed by expert engineers and advanced manufacturing. This ensures smooth implementation and long-term support.

By making SAF more accessible and cost-effective the company is helping the aviation industry move toward a cleaner future.

2030 Climate Strategy

Axens plans to reduce its Scope 1 and 2 emissions by 30% from 2019 levels by 2030. The goal is to remove 87.4 thousand tons of CO2 equivalent. The company is investing in cleaner technologies and improving operations for a sustainable future.

Check out its long-term climate goals below.

Axens sustainability
Source: Axens

The press release further highlights that Gevo, Axens, and IFPEN are working together to commercialize Gevo’s ETO process. Gevo is leading deployment in North America, bringing economic benefits to rural communities.

Axens will help with global commercialization by offering licensing, catalysts, and engineering services. This support ensures the widespread use of this innovative technology. All in all, this partnership will hugely boost sustainable aviation fuels and decarbonize the aviation sector at large.

Sylvera and BlueLayer Launch World’s First Live Carbon Data to Unlock $2B Investment

Jennifer L
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Sylvera and BlueLayer Launch World’s First Live Carbon Data to Unlock $2B Investment

Sylvera, a carbon data company in London, has teamed up with BlueLayer, a digital infrastructure provider. Their groundbreaking partnership seeks to change the carbon credit market. The partnership brings the first live carbon project and inventory data set. This aims to improve transparency, efficiency, and market access.

The initiative seeks to close the gap between supply and demand. It will also direct billions to finance essential carbon credit projects.

Bridging the Gap Between Carbon Credit Buyers and Suppliers

Projections show that the carbon credit market will grow tremendously. By 2030, it could grow to $7–$35 billion, according to MSCI. Several factors are driving this expansion. 

Demand for carbon removal credits is rising. Many view them as more credible, even though they cost more. Companies with ambitious climate goals for 2030 will likely rely on carbon credits to offset emissions. Buyers now focus on high-quality credits. They prefer projects with strong standards and clear transparency.

Looking further ahead, MSCI projects the market could reach $45–$250 billion by 2050. This growth will be driven by urgent corporate demand, as many companies approach their net-zero deadlines. 

carbon credit market value 2050 MSCI

The market will also shift toward removal credits, which could make up two-thirds of its value. These trends highlight the increasing importance of carbon credits in global climate strategies.

However, carbon market have long been hindered by inefficiencies and lack of transparency. Buyers face challenges in finding high-quality credits that align with their sustainability goals. Project developers face slow processes when responding to buyer requests and getting funding. 

Sylvera and BlueLayer’s partnership tackles these problems. It streamlines data exchange and boosts market access for buyers and developers.

This partnership uses BlueLayer’s digital tools and Sylvera’s carbon ratings skills. Project developers can show their carbon projects to buyers. Buyers also get real-time access to inventory, pricing, and project details. This helps them make better procurement decisions.

This is all done in a standard format for verified buyers. Buyers get real-time data with Sylvera’s Connect to Supply solution. This tool helps them easily evaluate and buy quality carbon credits.

Sylvera Connect to Supply
Source: Sylvera Connect to Supply platform

What are the Advantages for Project Developers?

This initiative helps project developers make money while keeping control of their data. By joining BlueLayer, developers connect with a large buyer network looking for quality credits. Some of the core benefits include:

  • Increased Visibility: Developers can connect with a wide range of buyers, boosting carbon credit sales for both pipeline and issuing projects.
  • Simplified Data Management: The platform lets developers manage carbon operations in one spot. This makes it easy to share data with potential buyers.
  • Efficiency in Data Exchange: Using standardized templates and automation speeds up responses to buyer requests. This reduces manual work in sales and due diligence.
  • Data Control: Developers choose what info to share, who to share it with, and when. This keeps their project data private and helps transactions go more smoothly.

How Do Buyers Benefit from It?

Buyers in the carbon credit market struggle to find reliable project information. But with Sylvera and BlueLayer’s partnership, they can now access real-time data. This includes key details from more than 200 developers. They focus on projects that reduce carbon through nature-based and engineering efforts.

The key advantages for buyers include:

  • Real-Time Data Access: Live inventory, pricing, and project details let buyers decide quickly and wisely.
  • Expanded Project Opportunities: Buyers can source credits from pre-issuance and issued projects. This gives them a wider range of investment options.
  • Trusted Due Diligence: Sylvera’s carbon ratings and monitoring tools help buyers check project quality. This way, they can reduce risks before buying.

Unlocking Billions for Real Climate Action

The partnership aims to unlock more than $2 billion for carbon projects. Already, over 80 projects have been introduced to buyers. These projects cover a total demand of 4 million carbon credits.

The collaboration aims to boost market liquidity. It will also drive more investment in climate solutions and speed up progress toward global net-zero targets.

BlueLayer Co-founder and CEO Alexander Argyros provides exclusive insights on this significant market development, highlighting these key points:

Solving Industry Challenges with Innovation

Argyros pointed out that the carbon market has great potential. However, it is held back by slow, manual processes. Developers have a hard time reaching buyers. Buyers, in turn, don’t have the data they need to invest confidently.

In fact, verification delays could cost project developers up to $2.6 billion, per a report by Thallo. These delays may also prevent the deployment of 4.8 gigatonnes of carbon credits by 2030. This shortfall is equivalent to not offsetting the annual emissions of 37 million U.S. citizens by the end of the decade.

Argyros notably commented that:

“This partnership is providing much-needed digital infrastructure, powered by BlueLayer’s API, for both suppliers and buyers, creating a faster, more connected, and more efficient market. Together, we’re leading the way when it comes to data standardisation and technology inoperability, enabling a seamless exchange of information to match buyers with high-quality project developers able to meet their specific investment criteria.”

Driving Market Growth and Investment

With over $2 billion in potential capital mobilization, Argyros emphasized BlueLayer’s role in shaping the future of carbon credit trading. As the first end-to-end operating platform for project developers, BlueLayer provides the necessary tools to scale businesses, maximize revenues, and streamline certification.

BlueLayer end-to-end platform
A snapshot of BlueLayer’s platform

The partnership with Sylvera boosts visibility by connecting developers to a large buyer network. This way, their high-quality projects get the investments they need to grow.

Ensuring Data Security and Transparency

Transparency and trust are critical to the success of carbon markets. According to Argyros, BlueLayer’s platform standardizes data while maintaining security and auditability through an end-to-end ledger system.

With this, developers keep full control of their information. This ensures data integrity and helps buyers make informed and confident decisions. 

Echoing Argyros points, Sylvera’s Co-founder and CEO Allister Furey noted:

“A successful global carbon market demands high-quality data to ensure that every credit traded reflects a real, measurable reduction in emissions. Partnering with Bluelayer enables us to remove barriers, simplify processes, and facilitate stronger connections between buyers and developers – on the foundation of end-to-end carbon data. It’s another big step in driving meaningful climate action and real progress as we continue to mature these markets.”

A New Era for Carbon Markets

The Sylvera-BlueLayer partnership sets a new standard for carbon market efficiency. It aims to speed up the shift to a clearer, larger, and better carbon credit market. A market that supports real climate action while making carbon trading more accessible and reliable for all stakeholders.

Gulf Countries Bet Big: $100B for Renewables to Slash Emissions by 20%

Jennifer L
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Gulf Countries Bet Big: $100B for Renewables to Slash Emissions by 20%

The Gulf Cooperation Council (GCC) nations, also called Gulf countries excluding Iraq, have announced a historic $100 billion investment in renewable energy by 2030. This initiative aims to reduce carbon emissions by up to 20% while transitioning toward sustainable energy sources.

With the region’s heavy dependence on fossil fuels, this bold move signals a major shift in energy priorities. But can the GCC truly lead the charge toward a greener future?

The $100 Billion Bet: Why It Matters

The announcement was made at the 43rd meeting on “Future Climate Change Management and Economic Development in the Gulf States” in Muscat. It marks a big step in the region’s energy change.

The GCC countries account for about 25% of the world’s oil production. They contribute around 1.5 billion tons of CO2 annually—roughly 4% of global emissions.

They also face serious climate risks. These include rising temperatures, water shortages, and higher sea levels. Projections show that Gulf temperatures could rise by as much as 2.5°C by the century’s end. This will make current environmental problems even worse.

Dr. Khalid bin Saeed Al Amri, Chairman of the Omani Economic Association, warned that ignoring climate issues could harm the economy. He noted that

“Global economic losses from climate-related disasters reached nearly $270 billion in 2022. In the Gulf region, failure to adopt effective climate measures could result in losses of up to 5% of GDP by 2050.”

Breaking the Oil Habit: GCC’s Energy Transition Strategy

The $100 billion investment will speed up the use of clean energy. This includes renewables, nuclear energy, and hydrogen. This aligns with global climate commitments such as the Paris Agreement and the objectives discussed at the COP summits.

The initiative marks a shift for the region, which has long depended on oil and gas revenues. GCC nations have a lot of fossil fuels, but they see the need to diversify their energy sources. They also want to improve sustainability urgently.

The Omani Economic Association and the Gulf Development Forum discussed climate strategies, energy policies, and necessary technologies. Experts looked at how behavioral science can aid climate action and the changing global climate framework.

Emissions Hotspots: The GCC’s Carbon Challenge

The six GCC nations – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE – share similar economic structures and environmental challenges.

GCC countries rank among the highest in global CO2 emissions per capita. Qatar currently tops the list, with other GCC nations also among the top emitters, per a study of CO2 emissions of GCC households.

GCC countries carbon emissions per capita 2021
Chart from the study of Ahmed et al., 2024.

Additionally, electricity consumption per capita is extremely high. Four of the top 10 countries for electricity consumption per capita are from the GCC. High living standards, economic growth, and extreme climate conditions drive this. These factors need energy-intensive cooling systems.

Turning Sunlight into Power: GCC’s Renewable Push

The GCC region has a lot of renewable energy potential, particularly in solar and wind. However, only 0.6% of its electricity is generated from renewables. However, there are ambitious plans to expand renewable capacity as shown below:

GCC countries renewable energy targets 2030
Source: Ahmed et al., 2024.

Additionally, green building codes, energy efficiency programs, and conservation policies have been introduced.

In 2014, the UAE banned incandescent light bulbs. This decision saved an estimated $182 million each year. It also cuts carbon emissions, which is like taking 165,000 cars off the road. In contrast, Saudi Arabia still relies on incandescent bulbs, with LED adoption at only 30% in some regions.

Solar and Wind Energy: The GCC’s Untapped Goldmine

The GCC region is well-suited for renewable energy, especially solar power. Oman has the highest annual solar radiation of up to 2,500 kWh/m², followed by the UAE at 2,285 kWh/m². Saudi Arabia and Kuwait both record around 2,200 kWh/m². Additionally, Oman, Saudi Arabia, and Kuwait have promising wind resources, with wind speeds above 7.5 m/s.

Renewable energy has many benefits, but its growth is slow. This is mainly because the government keeps electricity prices low through subsidies. This discourages private investment in solar power for households. However, large-scale government-led projects are expected to change this dynamic.

GCC Nations’ Net Zero Commitments

The push for renewables is crucial for the region’s climate and net zero goals. Here’s what each of the GCC nations aims for:

  • UAE was the first Middle Eastern country to commit to net zero by 2050, aiming to reduce carbon emissions by 23.5% (70 million tonnes) by 2030. Abu Dhabi is investing in solar and nuclear energy projects. Meanwhile, Dubai’s Future Council of Energy has outlined a plan for a carbon-free economy. The Abu Dhabi Fund for Development has pledged $400 million. This funding will support renewable energy projects in developing countries.

  • Saudi Arabia aims for net zero by 2060 and has pledged $1 billion in climate initiatives under the Saudi Green Initiative. Plans include a regional carbon capture and storage center, an early storm warning system, and cloud seeding programs to support sustainability efforts.

  • Qatar has the highest carbon intensity per person. To tackle this, the country has started a climate change action plan. It aims to cut greenhouse gas emissions by 25% by 2030. Qatar also plans to reduce the carbon intensity of its LNG facilities by 25% in that time.

  • Bahrain has committed to net zero emissions by 2060 and aims to reduce emissions by 30% by 2035. The country is putting money into renewable energy. It is also focusing on carbon removal and planting trees to meet its climate goals.

  • Oman is targeting net zero by 2050 and aims for zero routine flaring by 2030, along with a 7% emissions reduction by the same year. The country is boosting investments in renewable energy and efficiency. It aims to produce 20% of its electricity from renewable sources by 2027.

Key Measures for a Sustainable Future

To reduce emissions and enhance energy efficiency, experts have proposed several strategies:

  1. Solar PV and Hybrid Energy Systems: Switching household lighting to solar PV or hybrid systems (solar + wind) can reduce emissions from electricity use by 8% to 30%.

  2. Energy-Efficient Appliances: Encouraging the use of LED lighting and efficient air conditioning systems could significantly lower energy demand.

  3. Consumer Behavior Change: Awareness campaigns and incentives for energy conservation can reduce household energy consumption.

The GCC can shift to cleaner renewable energy and still grow its economy. Their $100 billion pledge is a key step to tackle environmental and economic issues.

The coming years will be critical as these countries implement their energy transition plans. The success of this initiative relies on ongoing investments, solid policies, and teamwork among governments, businesses, and international organizations.

BYD to Partner with European Automakers to Offset Emissions Through Carbon Credit Pooling

Saptakee S
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BYD to Partner with European Automakers to Offset Emissions Through Carbon Credit Pooling

Chinese EV giant BYD is in talks with European automakers to create a carbon credit pool. This effort helps traditional carmakers meet strict EU emissions standards. It also helps them avoid large fines starting in 2025.

Reuters reported that BYD’s special adviser for Europe, Alfredo Altavilla, confirmed the talks at an event in Italy. However, he did not provide specific details.

EU Tightening Grip on Light-Duty Vehicle Emissions

The EU aims to cut CO2 emissions from light-duty vehicles. This goal is part of their plan to fight climate change. Automakers are required to cut emissions significantly by 2025 compared to 2021 levels. The ultimate goal is 100% zero-emission vehicle sales by 2035.

  • In March 2023, the EU raised the bar further, mandating a 55% emissions reduction for cars and 50% for vans by 2030.

These tough policies urge automakers to boost EV production. They also force a big cut in emissions from ICE vehicles. This further keeps the industry moving toward a sustainable future. Study the breakdown from the figure here:

Challenges for European Automakers

To meet new regulations, battery electric vehicle (BEV) adoption will have to rise significantly. Automakers have to increase their BEV share from 16% in 2023 to about 28% by 2025. Each manufacturer, however, faces unique challenges. The latest report from ICCT shows:

  • Volkswagen and Ford must reduce emissions by 21%, the highest among automakers.
  • Hyundai, Mercedes-Benz, and Toyota face reductions exceeding the industry average of 12%.
  • BMW, Kia, and Stellantis are closer to their targets, with required cuts ranging from 9% to 11%.

These differences show how ready the industry is for EVs and how advanced the technology is.

EU automobile CO2 target
Source: ICCT
Note: Note: The 2025 targets are adjusted for expected changes in plug-in hybrid CO2 emissions. Data (sorted alphabetically) is shown for the 10 largest, leaving aside Tesla, a manufacturer that solely sells BEVs.

Carbon Credit Pooling: A Lifeline for Automakers?

Carbon credit pooling has emerged as a practical solution for automakers with limited EV sales. Manufacturers can team up with companies like BYD, Tesla, and Polestar. So how do they help automakers avoid the EU’s hefty cut?

  • Helps offset their fleet’s emissions and meet strict EU regulations.
  • Help them sell internal combustion engine (ICE) vehicles. They can do this while still meeting emissions limits.

Pooling agreements are reported to the European Commission by December 31 each year. This strategy gives European automakers a financial safeguard and vehicle manufacturers can avoid hefty penalties by getting closer to compliance.

Boosting Green Mobility with Emission Credits

We have seen and read how important emission credits are for the EU’s sustainability framework. In short, automakers earn these credits by producing vehicles with CO2 emissions below regulated limits. Companies like Tesla and BYD, which consistently outperform these standards, generate surplus credits.

They can sell these extra credits to traditional automakers. This helps others meet regulatory goals and generate revenue for themselves.

Additionally, this system encourages the production of low-emission vehicles. It fosters innovation and speeds up the industry’s move toward greener mobility.

BYD’s Advantage in Carbon Credit Pooling

BYD is a global leader in EVs. This makes it an excellent partner for carbon credit pooling. The wide variety of EVs and cutting-edge battery tech match the EU’s aim for zero-emission cars. By teaming up with BYD, traditional automakers can offset their emissions. This helps them meet regulatory targets and avoid fines.

Partnering with BYD boosts an automaker’s credibility in the EV market and attracts eco-friendly consumers. It also shows a commitment to lowering emissions.

 A Short-Term Fix for a Long-Term Challenge?

The increasing adoption of carbon credit pooling reflects a significant shift in the automotive industry. While EVs gain traction, many automakers continue to depend on internal combustion engine (ICE) vehicles for revenue.

Pooling agreements offer a temporary solution, allowing manufacturers to transition to electrification without immediate financial strain.

However, this strategy comes with challenges. Relying too heavily on pooling could stall critical investments in EV production and infrastructure. Automakers that fail to prioritize innovation risk losing competitiveness as emissions regulations become more stringent.

The EU’s tough climate policies are reshaping the industry. Carbon credit pooling provides short-term relief, but automakers must accelerate battery electric vehicle (BEV) production to remain viable and meet future emissions targets.

BYD’s entry into the European carbon credit market underscores the importance of global partnerships. Collaborating with EV pioneers and traditional carmakers can help drive the industry toward a more sustainable future. Success will depend on how quickly automakers adapt and innovate.

BYD’s Emissions Reduction Vision: Cooling the Earth by 1°C

BYD stated that in the last century, Earth’s temperature increased by 1.1°C. This rise has caused major environmental issues. To address this, BYD Auto and Mega Motor Company launched new green mobility solutions. These solutions focus on reducing carbon emissions and decreasing fossil fuel usage. They aim to lower Earth’s temperature by 1°C and create a healthier planet for future generations.

As of September 2024, the company’s efforts have:

  • Prevented 58 billion kg of carbon emissions, equivalent to planting 967 million trees.
  • Championed eco-friendly initiatives that reduce both operational energy use and pollution.

Driving Sustainability Through Green Operations

BYD’s 2022 CSR report emphasized its dedication to environmental protection through proactive measures. The company audits and verifies its greenhouse gas emissions. This ensures transparency and accountability. It also improves energy efficiency by making energy-saving upgrades throughout its operations.

The company has embraced electrification to make its operations eco-friendly. For example fully electric forklifts, trucks, and cleaning equipment power its production processes.

Its Zero-Carbon Campus uses 100% new energy-powered vehicles and innovative green solutions. The campus has solar panels and energy storage systems. It also offers SkyRail and SkyShuttle for green transport. By 2022, these efforts had successfully reduced 245,681 tons of CO2 emissions.

BYD emission
Source: BYD

BYD’s discussions with European automakers highlight the shifts in the automotive sector, propelling the EV giant’s sustainability goals. However, long-term success needs strong investments in EV technology and infrastructure.

Nickel Prices Plunge in 2025: Can Demand Revive the Market by 2030?

Saptakee S
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Nickel Prices Plunge in 2025: Can Demand Revive the Market by 2030?

Nickel—a vital component for stainless steel and electric vehicle (EV) batteries—is facing a challenging period in 2025. Supply-demand imbalances, shifting policies, and economic uncertainty are shaping the market, which is further impacting its price.

Notably, Indonesia holds significant influence over prices and supply, being the world’s largest nickel producer. Let’s explore the current state of the nickel market, the forces shaping it, and what lies ahead in the pricing trend.

Key Factors Behind the Ongoing Nickel Price Slump

Nickel prices have been falling steadily for two years. In 2024, the London Metal Exchange (LME) recorded an average price of $15,328 per metric ton, down 7.7% from 2023. By early 2025, prices dipped even further to $15,078 per metric ton—the lowest since 2020.

  • However, analysts predict average prices are expected to be around $15,700 per metric ton—a level insufficient to attract significant new investments.

Several factors are driving the price slump, and some of them are starkly evident.

Strong US Dollar

A stronger US dollar has made nickel more expensive for international buyers, reducing demand. When the dollar strengthens, commodities like nickel become less affordable for those using other currencies.

Robust US labor market data in early 2025 also impacted prices, pushing nickel to its lowest levels in five years.

US-China Tariff War

Additionally, ongoing geopolitical tensions, like US-China trade disputes post-Trump took over the presidency, have created uncertainty.

For instance, in January 2025, the announcement of potential 10% tariffs on Chinese goods added more pressure on base metals, including nickel.

Persisting Oversupply

At the same time, nickel production has consistently outpaced demand. Indonesia’s aggressive output expansion is a significant factor. With the country accounting for nearly half of the world’s nickel supply, its policies directly influence market dynamics.

Market experts predict that Indonesia’s nickel output will continue to grow at a strong pace this year.

  • As a result, the global primary nickel market is expected to remain oversupplied in 2025.

Nickel Prices in 2025: Where Are They Headed?

While nickel prices briefly surged to $16,168 per metric ton in December 2024 due to speculation about output cuts in Indonesia, it was short-lived. Prices quickly fell back to $15,113 per metric ton, highlighting the market’s fragility.

Despite this, Russian producer Norilsk Nickel (Nornickel) expressed confidence, announcing plans to sell all its metal production in 2025. However, market experts believe Indonesia’s policies and global environmental regulations will continue to dictate price movements.

Additionally, environmental concerns will continue to reshape the nickel industry. Stricter regulations could limit production, creating uncertainty for producers and investors.

For instance, companies failing to meet green standards might face production cuts. This has prompted some producers to look for alternative sources of nickel ore.

In the short term, price recoveries seem unlikely. Still, nickel’s role in key industries like EVs and renewable energy keeps it significant. Companies need to innovate, prioritize sustainability, and adjust to new dynamics to thrive in this changing market.

Indonesia’s Nickel Power: A Market Shaper

Indonesia controls almost half of the world’s nickel production. This solidifies its role as a major market influencer. Therefore, its policies and strategies can shape the global nickel landscape.

In late 2024, optimism grew when talks of cutting mining quotas emerged.

Credible media agencies reported that the Indonesian Nickel Miners Association (APNI) shared data in a recent hearing with the House of Representatives. It revealed Indonesia’s nickel production is set at 298.5 million wet metric tons, exceeding 2024’s 272 million tons.

This move shows a strong commitment to high output, keeping the market once again oversupplied.

Indonesia nickel

Despite being the top nickel producer Indonesia faces a tough balancing act. The government wants to boost economic gains from nickel exports. At the same time, it needs to tackle rising environmental issues. Producers failing to meet sustainability standards could face stricter regulations or production cuts.

Some Indonesian companies are looking to import nickel ore from the Philippines. This unusual step shows the tough regulations producers will have to deal with.

China’s Grip on Refining Raises Concerns

China’s dominance in nickel refining further complicates the scenario. Chinese firms control 75% of Indonesia’s refining capacity. This gives them a major hold on this key part of the supply chain. By 2030, Indonesia will likely produce 44% of the world’s refined nickel.

This could increase supply chain risks for EV makers that depend on this resource.

This dependency has raised concerns. Disruptions in Indonesia’s nickel output or China’s refining could impact global EV production. Automakers and battery makers might need to change their supply chains soon.

READ MORE: China and Indonesia Bolster Ties with $10B Deal in Strategic Sectors. How will it Impact Indonesia’s Nickel Industry? 

Nickel Price Forecast 2030 and Beyond

The analysis for the supply vs. demand chart emphasizes that demand is growing at a faster rate than supply. Over the period from 2023 to 2035, the compound annual growth rate (CAGR) for supply is 4.6%, while demand is projected to grow at 5.1%.

nickel supply and demand

Building on the supply and demand forecast, the current nickel oversupply and low-price environment are expected to shift. With a declining market balance and reduced oversupply, nickel prices are forecasted to rise. By 2030 and beyond, demand is projected to exceed supply, leading to a further price increase.

Nickel price 2025 forecast

In conclusion, the nickel market is currently facing persistent challenges of oversupply, slower demand growth, and stricter environmental regulations. These factors consistently drive prices downward. However nickel prices for 2030 and beyond show optimism for industry growth and mining.

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