The Green Finance Insititute (GFI), a global independent advisor to governments and investors, has officially launched its Carbon Dioxide Removal (CDR) Catalyst, facilitating a first-of-its-kind British biochar deal between Restord and Oxbury Bank.
As part of the CDR Catalyst, GFI has helped secure ~ $1.3 million (£1 million) financing from Oxbury Bank that will back the operations of Cornwall-based biochar developer Restord.
Enabled by philanthropic derisking capital from Catalyst founding partner Terraset, this deal represents the first commercial loan to support a UK-based biochar company.
The agreement entails a forward carbon credit purchase from Terraset and a new partnership structure between Restord, The Green Waste Company, and Woodtek Engineering, who will provide the pyrolyzer technology needed for biochar production.
On its end, Oxbury Bank is extending the required loan financing that will support the project.
Designed by GFI, the CDR Catalyst is being launched after a publication released by the Climate Change Committee—the UK’s independent adviser on tackling climate change—identified the emerging investment opportunity in engineered CDR after analyzing the country’s 7th Carbon Budget, highlighting “designing of finance mechanisms that unlock private capital at scale necessary for the transition.”
With Milkywire as a strategic advisor, the Catalyst aims to back commercial-scale CDR adoption across the UK, where more than 100 project developers currently account for less than one percent of global carbon removal credits.
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“The UK has outstanding CDR innovation, but scaling projects is very challenging, and too much of it is stuck between the lab and the market,” said Georgia Berry, CDR Director at the Green Finance Institute.
“This first-of-a-kind deal with Oxbury provides a strong proof point for our approach to scale the UK’s CDR market through convening critical partners, accessing patient capital and structuring deals in a way that de-risks investment,” she added.
Restord founder and CEO Tom Previte said this deal is an exemplary model for how financial innovation can support CDR projects to reach commercialization, sharing that the financing will enable the biochar company to remove around 2,000 tonnes of CO2 each year.
Read more: UK To Integrate Carbon Removals Into ETS
