Frequently Asked Questions
New to carbon removal
Carbon removal, also known as carbon dioxide removal (CDR), is the process of actively removing carbon dioxide (CO₂) from the atmosphere and storing it durably. The goal of carbon removal is to help mitigate climate change by reducing the concentration of CO₂ in the atmosphere. This differs from emissions reduction, which focuses on preventing CO₂ from entering the atmosphere in the first place.
Carbon removal technologies and approaches range from nature-based solutions like afforestation and soil carbon sequestration to engineered solutions such as Direct Air Capture (DAC) with geological storage and bioenergy with carbon capture and storage (BECCS).
At ClimeFi, we focus on engineered solutions.
Durable carbon removal refers to methods of removing CO₂ from the atmosphere and storing it for a very long time – typically hundreds to thousands of years or more.
The ‘durability’ of a carbon removal solution is crucial because CO₂ remains in the atmosphere for extended periods, contributing to global warming. For carbon removal to be truly effective in combating climate change, the removed carbon must be stored securely and durably.
Durable carbon removal refers to methods of removing CO₂ from the atmosphere and storing it for a very long time – typically hundreds to thousands of years or more.
The ‘durability’ of a carbon removal solution is crucial because CO₂ remains in the atmosphere for extended periods, contributing to global warming. For carbon removal to be truly effective in combating climate change, the removed carbon must be stored securely and durably.
Some of the key durable carbon removal technologies include:
- Biomass CDR
- Biochar: Biomass is heated in the absence of oxygen (pyrolysis), creating a charcoal-like substance (biochar) that is stored in soil or building materials.
- Biogenic CO₂ capture and storage (incl. BECCS): Biomass produces biofuels, electricity, heat, and pulp; CO₂ emissions from these processes are captured and stored. Since plants absorb CO₂ as they grow, it is considered a CO₂ removal.
- Other biomass CDR: Various methods using biomass include terrestrial biomass sequestration, bio-oil sequestration, and biomass burial.
- Direct Air Capture: Technologies that remove CO₂ directly from the ambient air using chemical processes to capture the CO₂, which is then stored in geological storage or via mineralisation.
- Enhanced Rock Weathering (ERW) and Mineralisation
- Mineralisation: Different processes where CO₂ is converted into stable forms.
- ERW: Accelerates the natural process of rock weathering to absorb CO₂, converting minerals into stable bicarbonates.
- Marine CDR: Technologies that use the power of the ocean to remove CO₂ either through enhancing the ocean's ability to absorb CO₂ or storing biomass in the ocean.
New to buying carbon
A carbon credit is a verifiable instrument representing the reduction or removal of one metric tonne of carbon dioxide equivalent (CO₂e) from the atmosphere. These credits are generated by projects that prevent emissions or actively remove CO₂, certified by independent third parties. When an organisation buys and ‘retires' a credit, they fund a project that achieves measurable climate action.
For a carbon credit to be credible, the underlying project must be real, measurable, additional (meaning it wouldn't have happened without the credit), permanent, and unique (not double-counted). Organisations use these credits to offset unavoidable emissions as part of their sustainability strategies.
Sourcing durable carbon removals begins with identifying reputable project developers and conducting thorough due diligence on their methodologies, permanence, and verifiability. Organisations often enter into "forward purchase agreements" to finance developing projects.
Procurement involves negotiating terms and contracting for the purchase of credits, which are then issued by recognised registries upon verified removal. Management includes continuous third-party verification, transparently retiring credits to prevent double-counting, and reporting on the achieved climate impact, ensuring the integrity and credibility of the carbon removal investment.
The market for durable carbon removal is supported by evolving standards, methodologies, and protocols to ensure high-quality, verifiable impact. Key standards include Puro.earth and Isometric, which specifically certify engineered removal methods.
These frameworks are crucial for building trust, providing consistent guidelines, and ensuring that purchased carbon removal credits represent genuine, long-term climate benefits.
Experienced carbon buyers
In addition to our core portfolio management and procurement services, ClimeFi provides a suite of value-added capabilities to support buyers across the full carbon-removal journey:
- Ratings: Independent project ratings based on our proprietary due diligence methodology, incorporating carbon integrity, delivery risk, and broader environmental and social safeguards.
- Intelligence: Market intelligence and analytics, including pricing benchmarks, supply insights, pathway trends, and risk signals, informed by ongoing monitoring of 500+ global CDR projects.
- Advisory: Strategic advisory services across durable CDR strategy, procurement planning, portfolio design, contract structuring, and engagement with emerging standards and frameworks (e.g., Article 6, CRCF).
To ensure complete alignment with buyer interests, ClimeFi exclusively represents corporate buyers and never accepts fees or compensation from project developers. This means:
- We do not develop projects ourselves, nor do we invest in them
- We are not resellers and do not assist projects in selling their supply
- We do not purchase credits for trading purposes
Instead, we act under the mandate from our clients (Buyers) and we subcontract all relevant suppliers on their behalf. The terms agreed with suppliers are identical to those accessible to our clients, and we never receive any fees from suppliers. We believe these incentives are essential to securing the highest-quality supply on the most favourable terms for our clients.
ClimeFi’s approach to mitigating delivery risk is twofold.
- Contracting & Negotiation:
Due Diligence insights inform the integration of critical contractual terms to manage delivery risks with suppliers, including:
- Securing volume access rights and rights of first refusal
- Ensuring a limited remedy period to exit contracts in case of project delays
- Securing options across various projects to counterbalance delivery delays in some projects with other high-qualit durable credits at competitive terms
- Including price adjustment mechanism clauses
- Monitoring & Delivery:
Due Diligence identifies key variables – beyond standardised metrics – that ClimeFi must monitor quarterly until delivery to proactively manage delays and non-delivery risk. This enables us to actively manage CDR assets, including identifying and replacing underperforming projects.
Should a project update impact its rating (e.g., increased delay risk), ClimeFi directly notifies the end buyer, presenting available options contextualised by existing contractual terms, to address the risk and providing ClimeFi's recommendation.
