The Carbon Dioxide Removal (CDR) market witnessed a significant shift in Q2 2024, as Bioenergy with Carbon Capture and Storage (BECCS) emerged as the dominant method, accounting for a remarkable 90% of all transactions by volume.
The quarter saw a total of 4.8 million tons of durable CDR transactions, with BECCS alone contributing 4.3 million tons, solidifying its leadership in the sector, according to a recently released market update by CDR.fyi.
The BECCS boom in Q2 was largely driven by a single landmark deal between Microsoft and Stockholm Exergi, which involved the purchase of 3.33 million tons.
This transaction alone represented 70% of the quarter’s total sales, underscoring the growing influence of BECCS in the carbon removal landscape.
Relevant: Stockholm Exergi Lands World’s Largest Permanent Carbon Removal Deal With Microsoft
In contrast, Biochar Carbon Removal (BCR), which had dominated the market in Q1 with 81% of the transaction volume, saw its share plummet to just 4.4% in Q2, amounting to approximately 210,320 tons.
This sharp decline highlights the rapid ascent of BECCS as the preferred CDR method among major buyers.
As of Q2, BECCS has not only dominated the quarter but also secured its place as the top method overall, accounting for 67% of cumulative durable CDR tons sold to date.
Direct Air Carbon Capture and Storage (DACCS) trails significantly behind, holding just 13% of the cumulative market share.
Despite Microsoft’s dominance in transaction volume, the company has engaged with only 25 CDR suppliers, compared to other buyers like Shopify and Frontier, which have diversified their portfolios across more suppliers, according to the report.
Microsoft’s significant contributions have elevated the durable CDR market, driving a 7.5-fold increase in transaction volume since 2023.
However, as the market remains in its early stages, further growth and stability will depend on broader participation from other companies stepping up to support this critical climate initiative, CDR.fyi said.
Read more: CDR.fyi Releases 2024 Q2 Durable CDR Market Update
