Frontier Buys $48.6M Worth Of Bioenergy With CCS Credits From Stockholm Exergi

Frontier Buys $48.6M Worth Of Bioenergy With CCS Credits From Stockholm Exergi - Carbon Herald

Another carbon capture and storage deal on a biomass-burning energy facility is advancing the space of CDR. Frontier – the market commitment aiming to spur growth of critical carbon removal solutions, has facilitated offtake agreements with Stockholm Exergi – Stockholm’s energy provider, to enable a carbon removal retrofit on a biomass-based district heating facility. 

The deal is for $48.6 million of the facility’s carbon removal output between 2028 and 2030. The facility’s carbon capture retrofit is deemed to remove 800,000 tons of CO2 annually starting in 2028. 

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The exact volume of tons going to Frontier buyers, and the price per ton, will be announced pending the outcome of a competitive reverse auction being conducted by the Swedish government, in which Exergi hopes to win subsidies. The carbon capture and storage tons from the bioenergy plant are purchased by Frontier’s buyers or companies including Stripe, Alphabet, Shopify, Meta, JP Morgan Chase CO, H&M and McKinsey Sustainability. 

How Exergi meets Frontier’s Biomass Sourcing Principles. Source: Frontier

Exergi will retrofit a district heating facility in downtown Stockholm to combust woody biomass waste (treetops, branches, saw mill dust, etc.) sourced from Sweden and nearby countries in Europe to produce heat and electricity for 800k Stockholm residents. The resultant CO2 from the process will be collected and transported via ship to be permanently sequestered deep underground. 

As biomass burning for energy has several issues concerned with the sustainability of the sourced biomass and responsible development, Frontier has developed six rigorous principles that ensure a high degree of scrutiny. These principles are first used to diligence Frontier suppliers’ biomass sourcing strategy and then applied on an ongoing basis to ensure each ton of carbon removal delivered meets the highest standards.

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They are as follows: 

  • The biomass use for carbon removal is only when there is no other better use for it (i.e when it is considered “waste”);
  • Biomass that would have otherwise stored CO2 for a long time in the absence of the project is excluded;
  • The biomass being sourced from places with a growing stock of carbon is ensured;
  • Waste biomass is used instead of biomass grown for the purpose of energy production;
  • Sourcing from primary forests or other ecologically sensitive areas is avoided, and protecting and/or rehabilitating local natural habitats (e.g. preventing soil erosion and preserving biodiversity) is supported;
  • Accounted for are the emissions related to the harvesting, transport, and storage of the biomass.

More details about each principle and how Exergi’s approach performs against these principles can be found here. The agreement with Frontier is a testimony that Stockholm Exergi’s bio-carbon capture and storage project is sustainable as according to the announcement, Exergi is well set-up to execute on the tracking and tracing required to ensure compliance on every ton.

The project is considered to deliver near-term affordable bioenergy with CO2 storage credits, with a trajectory to <$100 per ton. Some further reductions in capex and transportation costs also facilitate the path towards the <$100/ton at scale goal.

The biomass used from the facility is diverted from Swedish and neighboring countries’ forestry systems where they would otherwise rapidly decay, according to Exergi. The company must meet the conditions of Frontier and its principles on the deal. 

“The agreement with Frontier and its prominent member companies is a very strong testimony of the efficiency and sustainability of Stockholm Exergi’s BECCS project… The primary winner is the climate as we set our societies on track to meet the objectives of the Paris Agreement. The agreement with Frontier is an important milestone towards our final investment decision,” commented Anders Egelrud, CEO of Stockholm Exergi.

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