· 3 min read
illuminem summarises for you the essential news of the day. Read the full piece on MIT Technology Review or enjoy below:
🗞️ Driving the news: The carbon removal sector, crucial for mitigating climate change, is facing a challenging phase after an initial burst of excitement
• Despite the emergence of multiple startups, the market has struggled to meet its ambitious goals, with only 940,000 tons of carbon removal delivered so far
• With projections requiring up to 11 billion tons per year by 2050, the sector’s current pace is far behind the necessary scale
• The looming question is whether governments will step in to fund or regulate the sector to ensure its growth
🔭 The context: The sector initially attracted major investments and corporate buyers, including Microsoft, Google, and Stripe, all pledging to pre-purchase carbon removal credits
• However, as venture capital investments wane, and demand growth slows, a gap in supply and demand persists, leading to financial difficulties for smaller companies
• Notably, Microsoft accounts for 80% of carbon removal purchases, which leaves the sector vulnerable to fluctuations in their investment priorities
🌍 Why it matters for the planet: While carbon removal offers the potential to reverse climate change, it is not yet a viable business model without substantial government intervention
• Scaling up the sector will require massive investments, potentially in the trillions, and will necessitate government-backed policies and incentives
• Without this support, carbon removal may not be able to meet the urgent targets needed to combat global warming
⏭️ What’s next: As public policy becomes more central to the success of carbon removal, governments are expected to play a larger role in funding and regulating the industry
• The EU has already made strides by proposing to include carbon removal within its Emissions Trading System post-2030
• Other nations, including Canada and Japan, are also introducing frameworks to integrate carbon removal into their climate strategies
• The long-term success of this sector hinges on ensuring transparency and credibility, as standards for measuring the actual climate benefits of carbon removal remain a concern
💬 One quote: “We need policy; it has to be policy,” says Erin Burns, Executive Director of Carbon180, stressing that private-sector purchases alone won't scale the industry
📈 One stat: As of now, carbon removal companies have delivered just 940,000 tons of CO2, while the US emits that amount every two hours
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