16 June 2023
The NextGen CDR Facility (NextGen), a partnership between global consulting firm South Pole and Mitsubishi, has acquired 193,125 tons of carbon dioxide removals (CDRs) from three projects, which represents the world’s largest CDR portfolio.
NextGen’s monumental purchase, which is estimated to amount to around 25% of all CDRs purchases to date, will include CDRs from the world’s largest Direct Air Capture and Storage (DACS) project, currently being developed in Texas.
“Our ambition to scale the market has taken a major step forward following these initial CDR purchases and puts us on a clear pathway to realize our target of 1 million durably stored tonnes of CO2 by 2025,” said Philip Moss, Chairman of NextGen and Global Director at South Pole.
“Not only will these advance purchases establish a quality standard by ensuring independent certification of technological carbon removals, these commitments from our buyers will unlock financing for many emerging CDR projects and technologies,” he added.
The creation of NextGen was powered by the investments of early stage buyers including Boston Consulting Group, LGT, Mitsui O.S.K. Lines, Swiss Re, and UBS.
A report from the Intergovernmental Panel on Climate Change, released in March 2023, emphasized that the current global rates of CDR deployment are not on target to effectively curb global warming within the Paris Agreement limit of 1.5 degrees Celcius. The scale of these sophisticated CO2 removal schemes has not yet reached a point where it can offer real value towards a safe and sustainable future.
“Permanently removing CO2 from the atmosphere at scale is vital to achieving net-zero by 2050 and meeting the Paris Agreement. We are proud to be an anchor buyer in the NextGen Facility and support pioneering carbon removal technologies that are removing emissions now,” said David Webb, Chief Sustainability Officer at Boston Consulting Group.
Carbon capture is sometimes viewed as a polarizing solution to climate change among scientists. Some critics argue that investing in such technologies may divert attention and resources away from more urgent and effective climate mitigation measures, while others express concerns about their scalability, cost-effectiveness, and potential environmental impacts of improperly stored CO2.
Another innovative way to engage the market on cutting back emissions that has emerged in recent years is the related concept of carbon offsetting, wherein carbon credits can be bought and sold on what is known as the voluntary carbon market. In this way, companies that exceed legally permitted levels of greenhouse gas emissions can buy credits from other companies that have reduced their carbon footprint significantly enough to sell that cutback in the form of an institutionally recognized credit.