2023 was a milestone year for carbon removal with the industry graduating from a field largely populated with startups, to one that has a growing number of scaleups, government and private investment in the billions and its own voice when it comes to influencing policy and how we tackle emissions in the atmosphere.
With this in mind the AlliedOffsets team has been meticulously gathering data on hundreds of metrics throughout last year, looking for the trends and patterns defining this congregation of technologies that share the common goal of removing CO2.
With data from over 200 credit buyers and 300 investors, the end product is a 27-page report with over 40 charts and graphs, authored in collaboration with Carbon Herald. It provides a snapshot of the state of play in 2023, as well as forward price projections to 2030, 2040 and 2050 (where available) for a total of 11 approaches including direct air capture, carbon mineralization, biochar, enhanced rock weathering and ocean-based approaches.
Carbon capture and utilization are also included, as the technologies, supply chains, and transport infrastructure used for them largely overlap with those focused on removal.
According to some key findings, the number of companies entering the CDR market has grown exponentially over the last five years. Following $3.5B in investment last year, we now have over 600 companies working on sequestering, capturing, storing and utilizing CO2.
The three main aspects of the CDR market are also quantified and analyzed.
Prices per ton of removed carbon decreases from $630 to $450
With CDR technologies still largely in a nascent stage their prices are inherently higher than what they will most likely be in the future. By using the collected data from publicly available resources and individual company announcements over the course of the year, the AlliedOffsets team has created aggregated projections for ten of the technologies.
One of the most useful tables for readers will likely be the side-by-side comparison of the prices in 2023 and those projected for 2030 and beyond. Alongside the vintage forward curves for each method it aims to provide one of the most comprehensive forecasts for where the industry is headed.
Demand analysis for CDR credits
Interest from buyers has seen rapid growth, so much so that pre-purchase commitments dominate the landscape, giving a strong demand signal even before the technologies have reached maturity and scale.
The report provides details about the top ten purchasers and sellers in 2023, as well as a deeper dive into the sectors where demand is likely to originate from going forward.
Investment in CDR
AlliedOffsets have collected an exhaustive amount of information about the investments into all the different sectors of CDR over the last six years. And the numbers have several layers to them.
CDR saw a total of $3.5B in investments last making it one of the few areas of climate tech that have bucked the overall downtrend in 2023. According to CTVC the market saw a 30% drop compared to 2022 and of lowered investments.
The report also provides intelligence on who the key investors are, as well as the startups and scaleups that managed to raise the highest investment rounds.
You can find the 2023 CDR market report’s contents below and if you are interested in purchasing it you can follow this link.
Introduction and Executive Summary
Descriptions of the Carbon Removal Technologies
Analysis of Available Data on Price per Ton of Removed Carbon
Analysis of demand for carbon removal credits
Carbon removal as a percentage of the broader carbon markets
Policy snapshot – review of support mechanisms in the US, EU, UK and globally
Investment into CDR