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Carbon crediting platform reports significant growth in carbon dioxide removal market

Written by
ClimeFi Insights
Published on
17 December 2024
Carbon crediting platform reports significant growth in carbon dioxide removal market

A new report from Puro.earth reveals a dramatic increase in carbon removal certificate retirements, highlighting the evolving dynamics of the CDR market across EMEA and the Americas.

The carbon crediting platform Puro.earth has unveiled a pivotal report detailing the development of the carbon dioxide removal (CDR) market, showcasing substantial growth driven primarily by regions in Europe, the Middle East, Africa (EMEA), and the Americas. This report is based on comprehensive data gathered from Puro.earth’s extensive network comprising both suppliers and buyers in the CDR sector.

Notably, the report highlights a dramatic increase in the retirements of Carbon Removal Certificates (CORCs), which skyrocketed from 16,000 in 2020 to an impressive 156,000 in 2024. This represents a staggering annual growth rate of 90%. The EMEA and the Americas collectively account for an overwhelming 98.2% of the total market value of CDR transactions, marking these regions as the dominant forces within this evolving market.

In terms of demand, the United States stands out as a significant contributor, accounting for 94% of the 53.6% share of the global offtake value from the Americas region. The American market is not only distinguished by high demand but also by robust development of CDR projects and a steady supply of credits.

Germany and Switzerland lead the charge in the EMEA region, contributing 56% and 32%, respectively, to the area's 44.6% share of total offtake value. The report emphasises a trend among EMEA buyers towards investing in longer-term offtakes, with a majority of transactions ensuring carbon removal activities extend beyond the year 2030.

The Asia-Pacific (APAC) region, while it accounts for 19.1% of the total offtake value, shows a marked lag in CDR demand with a mere 1.7% of the total regional demand reported. This indicates potential growth opportunities for suppliers willing to engage and develop in this market.

Moreover, the analysis from Puro.earth points to a significant concentration of supply, with a small number of CDR projects responsible for 71% of total offtake value. Among the various methods of carbon removal, biochar emerged as the frontrunner in terms of retirements. Additionally, retirements involving geological storage of carbon (GSC) have also seen growth in 2024.

Looking forward, the report forecasts a vibrant and active CDR market in the coming decades. Between 2025 and 2044, a total of 211 individual offtakes are projected to be delivered, amounting to an estimated value of nearly €269 million ($282 million). This anticipated growth underscores the increasing recognition of carbon removal as crucial in the broader context of climate solutions.

As the CDR market continues to expand, it is set to play an increasingly central role in global efforts to mitigate climate change, drawing attention from businesses and investors alike.

Source: Noah Wire Services