Permanence, Verifiability, and Scale: Emerging CDR Technologies

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UK government agency the Met Office predicts that atmospheric carbon dioxide will exceed 420 parts per million (ppm) in 2023, which is significantly higher than the 350 ppm target scientists say we need to stay below to avoid catastrophic climate impacts. Reducing emissions alone will not result in such targets being met. According to the US National Academies and others, emission removals of 1.5-10 gigatonnes a year will be needed by the late 2050s to give us a chance to keep global warming to manageable limits.

Carbon dioxide removal (CDR) will undoubtedly have a role to play here. The term refers to technology-enhanced biochemical processes that remove CO2 from the environment and store it permanently. Direct Air Capture (DAC) uses chemical processes to extract CO2 directly from the air, while innovative ocean-based techniques can leverage the carbon-storing potential of oceans and marine life. Propelled by rising corporate demand for carbon neutrality, these technologies have seen surging investment and growth in recent years. By improving transparency and environmental integrity, the rise of CDR has the potential to usher in a new era for carbon markets.

Direct Air Capture

Few carbon removal approaches match the spectacle and simplicity of DAC—which offers the realized ability to identify and remove CO2 straight from the air. This explains why DAC has been a key focus of interest from states, the media, and the general public alike. As the name suggests, it uses chemical processes to capture CO2 directly from ambient air. The most common approach involves using large fans to move air through a system containing chemicals that selectively bind with CO2 molecules, separating them from other atmospheric gasses. This is the route taken by Swiss company Climeworks, the poster child of the first generation of DAC, at its site in Iceland and by Sirona Technologies, a Belgian company following the Tesla model of rapid hardware company scaling. The extracted CO2 can then be sequestered underground into stable geological formations or put to industrial use in products like fuels, chemicals, and building materials. 

While first-generation DAC required massive energy inputs to power the air-moving fans and chemical processes, companies like Heirloom Carbon Technologies have developed more efficient methods. Next-generation DAC can achieve the same capabilities with drastically reduced energy requirements by using passive contact materials instead of fans and harnessing abundant minerals like calcium carbonate (limestone). 

Heirloom’s first plant, which officially opened earlier this month in California, has a capacity of 1,000 tonnes of CO2 removal per year. This is equivalent to the annual energy use of about 126 US homes and is therefore not in itself going to move the dial on climate breakdown. However, Heirloom’s technology is built to scale, and the company is confident in its ability to remove a total of 1 billion tonnes of CO2 from the atmosphere by 2035. It has already sold 315,000 tonnes of forward credits to Microsoft, with these credits reported to have retailed for $200 million.

With its focus on scaling energetically favorable carbon mineralization reactions that occur in nature, Heirloom is basically supercharging geological processes. Their system is entirely passive, completely eliminating energy-intensive fans for air contact. It uses calcium carbonate, an abundant mineral that makes up around 4% of the Earth's crust, to bind with the CO2. The calcium carbonate is sent to a specialized high-temperature reactor where it is decomposed into calcium oxide and CO2. The CO2 can be stored geologically or mineralized, while the calcium oxide is hydrated to form calcium hydroxide to use as a sorbent. At the California plant, the CO2 is being permanently sequestered in concrete by partner organization CarbonCure Technologies. On the other hand, the regenerated calcium oxide is continuously cycled back to capture more CO2 in a closed-loop process. Further, Heirloom’s use of a modular plant design enables incremental capacity increases, allowing for rapid scaling to meet multi-gigatonne climate targets. The company’s focus on continuous iterative improvements could drive DAC’s costs down exponentially, similar to solar PV's experience curve.

These are early days for DAC, and the technology is currently very capital-intensive. While Microsoft, as well as Stripe and Shopify, have been the early powerhouses behind DAC financing, more money from more sources has recently started to flow into the space. Recently, Blackrock invested $550 million into Occidental Petroleum’s first large-scale DAC plant, covering 40% of the $1.3 billion Stratos project cost. These plants must spend heavily upfront on specialized components like air contactors, CO2 pipeline infrastructure, and other systems with high fixed expenses. Yet DAC's modular and replicable nature provides a clear route toward cost reductions once volume production and learning curve improvements are realized. Cash injections like Blackrock’s are necessary and are bolstered by tax credits made possible by the US Inflation Reduction Act, which boosted subsidies to $130–$180 per tonne of CO2 captured. The Act also expanded provisions around the transferability of credits and direct Treasury payments. These changes make even small DAC plants such as Heirloom’s first facility financially viable. With government incentives spurring projects, corporate interest and investment in DAC will clearly grow over the rest of this decade and beyond.

Biotic Ocean CDR (Direct Ocean Capture)

All of the technologies discussed above use ambient air to extract CO2. However, with over 70% of the planet's surface covered in water, there is increasing interest in harnessing that surface area to reduce carbon in the atmosphere. Beyond absorbing solar radiation and distributing heat and moisture worldwide, oceans naturally serve a critical—albeit often overlooked—carbon sequestration function. About 30% of human-emitted CO2 to date has been directly absorbed by the oceans, while over 90% of the excess heat trapped by Earth's atmosphere due to pollution has been stored in oceanic mass. The sheer scale of these natural regulating effects underscores why the marine environment represents such an exciting frontier for carbon removal. Already storing vast quantities of carbon and spanning the majority of Earth's livable biomes, the seas could be the driving force behind multiple CDR solutions that work in tandem with land-based DAC projects. A wide variety of ocean-based techniques spanning engineering, geological, and biochemical processes are currently being developed and tested. One category known as biotic ocean CDR aims to directly leverage the potential of marine organisms to help stabilize the climate.

Biotic ocean CDR refers to emerging methods that leverage biochemical processes to sequester carbon, harnessing the innate carbon capture and storage capabilities of marine ecosystems and their inhabitants. One prominent example is cultivating macroalgae (seaweed) that absorb dissolved CO2 from seawater through rapid photosynthesis. The macroalgae biomass is then sunk into the deep ocean below the thermocline, where organic decomposition ceases. This results in permanent isolation of the carbon within the structures of the algae. With native species requiring no human inputs like fertilizers, such biotic ocean solutions offer a natural pathway for gigatonne-scale CO2 removal that enhances ocean biodiversity and ecological function. Additional engineering interventions can further augment the carbon removal impacts. 

Macroalgae farming has seen explosive growth in the past decade, with production centered in Indonesia and the Philippines and swelling to 25 million tonnes by 2020. However, systems remain small-scale, manually intensive, and confined to shallow, nearshore waters. Achieving climate-relevant scales of CO2 sequestered annually will require offshore expansion and industrialization. Sophisticated moorings, robotic harvesting, durable materials that can withstand buffeting by waves and wind, and investments in skilled labor, transportation networks, and complementary facilities will be needed. While complex, such scaling mimics historical transitions seen in terrestrial farming—and baseline growth rates suggest that macroalgae will be one of the most promising ocean-based CDR techniques if key technical and economic hurdles can be overcome through public and private sector coordination.

Companies like Running Tide and Brilliant Planet are exploring techniques to cultivate marine organisms like macroalgae and microalgae for carbon removal. Running Tide, which positions itself as a global ocean health company, focuses on sinking cultivated macroalgae biomass to deep ocean layers for permanent sequestration. They deploy modular systems called Carbon Buoys that are made of natural materials and aim to have a net positive environmental impact. The sunk carbon is measured and verified to ensure transparency. Beyond sequestration, some of the Carbon Buoy designs also introduce alkaline minerals that enhance the ocean’s alkalinity and chemically fix additional atmospheric carbon. Running Tide describes its process as redistributing excess carbon from faster natural cycles to slower ones. While questions remain around the ecosystem impacts of scaled-up processes, Running Tide's combining of mineral-enhanced weathering with macroalgae cultivation appears to be in harmony with natural oceanic carbon cycles and is a promising CDR pathway in terms of both cost and scalability. 

Brilliant Planet also harnesses the power of algae to provide a natural carbon removal solution. Their patented process rapidly grows microalgae in coastal deserts, leveraging photosynthesis to fix atmospheric carbon up to 30 times more efficiently per area than forests. The harvested biomass is first solar-dried to stabilize the carbon for 1,000+ years and then buried, sealing the carbon underground. Brilliant Planet claims this process has the potential for gigatonne removal rates utilizing arid, non-arable land to grow the microalgae. Beyond CO2 sequestration, the process contributes to ocean health. For every measure of acidic saltwater utilized, in excess of tenfold is neutralized and restored to the ocean after cultivation. This aids local marine ecosystems through increasing alkalinity. Combined with algae's innate efficiency for carbon fixation, Brilliant Planet's closed-loop saltwater process offers a verifiable nature-based carbon removal technique with significant scale projections and alkalinity enhancement benefits.

Abiotic Ocean CDR

The natural alkalinization process can be harnessed at a significant scale to combat the climate crisis and various abiotic CDR approaches are attempting to do so. As touched on above, over 30% of human-generated CO2 emissions have historically been absorbed by Earth's oceans. However, heightened CO2 concentrations are triggering rising acidity levels through carbonic acid formation. Ocean acidification threatens entire marine ecosystems and food chains. Ocean alkalinity enhancement (OAE) is an abiotic CDR approach that aims to counter this problem while removing further atmospheric carbon through a process often called ‘enhanced weathering’. OAE works by adding alkaline minerals to seawater, accelerating its innate chemical carbon capture. This converts dissolved CO2 into stable bicarbonates and carbonates with lifespans reaching 10,000 years. The resulting surface water alkalinity shift sparks a net atmospheric CO2 transfer into the oceans that can help restore atmospheric equilibrium.

OAE is carried out via two primary methods: electrochemical or mineral processing. In electrochemical alkalinity addition, alkalinity is produced by applying an electric current through seawater, often using coastal infrastructure retrofitted for OAE. The newly alkaline solution gets discharged back into the ocean, binding dissolved atmospheric CO2 as bicarbonate. The process itself consumes energy for the electrochemistry, but no power is needed for the resulting carbon capture chemical reactions. In mineral-based processing, abundant alkaline mineral deposits like calcium carbonate and silicates can be finely crushed and added to seawater, either on shorelines or distributed offshore. Exposing these minerals to seawater triggers natural chemical reactions that convert dissolved CO2 into stable carbonates. While no power generation is involved, the mining and mechanical crushing steps, plus potential transportation, require substantial energy inputs.

Both methods can significantly boost seawater alkalinity to enhance oceanic CO2 storage capacity. However, it is vital that OAE is carried out in ways that do no harm to the marine ecosystem. One organization that claims to have found a way to do this is Project Vesta. This San Francisco-based non-profit, which has already sold forward credits to Stripe, is pioneering a method of enhanced weathering that uses green sand derived from the mineral olivine. Their process involves grinding down the abundant volcanic rock into fine sand particles. The olivine is spread across specific coastal areas, like the Caribbean beach it has selected for its pilot study. 

As the olivine sand mixes with seawater, the wave energy further erodes the grains, accelerating chemical reactions that draw CO2 out of the air while also alkalizing the ocean. The emissions get incorporated into marine shells and skeletons in the form of solid carbonate compounds and stored for millions of years. Analysis projects this process can offer 20x greater CO2 removal gains relative to the mining and transport emissions it is associated with—and one paper, see below, has suggested that devoting 2% of the Earth’s most energetic shelf seas to this enhanced mineral weathering could offset annual anthropomorphic CO2 emissions in their entirety. The promise is clearly huge, but Project Vesta is taking a careful approach. It plans gradual small-scale trials with intense community engagement before slowly expanding, funding scale-up of its techniques through the carbon markets.

A pioneer in electrochemical OAE is Captura. Founded in 2021, the company utilizes a direct ocean capture system that relies on renewable energy to remove CO2 from seawater without the need for additives or generating byproducts. The technology was developed at Caltech with support from industry leaders and the XPRIZE carbon removal competition. Captura employs a novel form of electrodialysis relying on Henry's Law to remove CO2 from seawater. This creates an imbalance, with the resulting alkaline outflow causing the ocean to subsequently draw down more atmospheric CO2. Captura intends to rapidly grow from current pilots to eventual megatonne-scale deployments. 

Ebb Carbon is another promising OAE startup employing electrochemical processes for efficient ocean carbon removal. Their electrochemistry works by accelerating the ocean's natural alkalization processes to store excess CO2 as stable bicarbonates for over 10,000 years. Their system can be retrofitted to desalination plants' brine outflows or power plant cooling water. Acid is removed and used for commercial use; the leftover brine or seawater is highly alkaline, which draws down more atmospheric CO2 while forming natural bicarbonate compounds. Ebb Carbon projects the potential for their technique to remove gigatonnes of CO2 annually at costs below the key $100 per tonne price. Modular and sidestream compatible, their technique offers infrastructure-light carbon removal with acid generation as a potential extra revenue source. 

The future of CDR and carbon markets

While still facing barriers like high upfront costs and unproven at-scale viability, emerging CDR techniques clearly demonstrate immense potential. DAC, biotic CDR, abiotic CDR, and other methods promise improved permanence, verifiability, and environmental integrity for the carbon credits they produce. These technologies remain early stage, with challenges around energy efficiency and localized ecosystem and community impacts requiring ongoing research. However, recent exponential growth in voluntary credit purchases linked to these high-quality CDR approaches underscores increasing corporate demand. 

CDR purchases saw explosive growth in 2022 and the pace has continued accelerating in 2023. According to carbon removal data platform CDR.fyi, the first half of 2023 alone witnessed 3,398,763 tonnes purchased—nearly six times the 604,756 tonnes transacted across the entire prior year. Their models forecast 2023 as a whole being an order of magnitude higher year-over-year. That said, delivered volumes continue lagging far behind pre-purchases, with only 33,636 tonnes actually removed this year. This underscores that this is a market still gearing up the complex infrastructure for permanent sequestration and use. However, the growing corporate pre-purchase appetite indicates great confidence in forthcoming methods to provide verifiable, high-integrity credits and increased comfort with carbon forwards in general. Ultimately, reaching climate-relevant gigatonne scales will mean significantly expanding buyer participation beyond early movers, with a handful of companies currently making up the vast majority of all credit purchasers. 

Certain organizations like Frontier are pioneering new investment approaches to help companies such as the ones covered here overcome startup costs and directly accelerate CDR pathways. Frontier coordinates ‘advance market commitments’ wherein Stripe, Alphabet, Shopify, Meta, McKinsey, and thousands of SMEs using Stripe Climate dedicate over $925 million to purchase removals. Frontier also employs long-term energy market-style ‘offtake agreements’, guaranteeing future payment to suppliers once project milestones are hit and enabling them to secure financing. By sending demand signals and thus reducing project uncertainty, these frameworks can catalyze the supply of new carbon removal supply. Microsoft's $1 billion climate innovation fund pursues a similar strategy. The end result of these investments will hopefully be a robust pipeline of extremely high-quality carbon removal credits flowing into global compliance markets and the VCM in the relatively near future.

At Neutral, we firmly believe these new methodologies will form the basis of verifiable, trustworthy credit instruments. Especially as standardized quantification practices mature, blended finance mechanisms could couple the reliability of engineered removal with the undoubted benefits of current, proven nature-based solutions. The combination will undoubtedly benefit both people and the planet as a whole.