A new AlliedOffsets report reflects booming carbon dioxide removal (CDR) traction in the first half of 2025, with 16 million carbon credits transacted in the first six months of this year.
Taking a deep dive into available market data, the report findings paint 2025 as the year with the strongest H1 CDR transactional activity so far, marked by the highest-ever volume of carbon credits sold in a six-month period.
It also highlights Microsoft’s integral role in this market development, as the tech company is responsible for 92% of all CDR purchases registered during the review period.
Exploring a scenario in which Microsoft did not make these market-defining purchases, the report finds that the volume of delivered credits would shrink from 38 Mt to a mere 8 Mt.
For CDR suppliers, the corporation provided vital early-stage funding to help take projects off the ground. In that regard, the report points out that 25 projects named Microsoft as their first buyer, while for 16 of those initiatives it was also the only buyer.
Biomass-based CDR approaches were the most sought-after solutions in H1 of 2025, with 94% of the total volume delivered coming from projects focused on BECCS, biochar, and bio-oil burial.
At the same time, investments were also disproportionately directed toward Direct Air Capture (DAC) and Utilization projects.
On the supplier side, Atmosclear, Stockholm Exergi, and CO280 are the three main pillars responsible for 75% of delivered credits in the first six months of 2025, and innovative company Gigablue stands out with the first major marine CDR offtake agreement.
While the number of active buyers is still spearheaded by financial services providers and volumes are dominated by the tech sector, the report signals a game-changing positive trend where half of all the purchases in H1 of 2025 came from first-time buyers, marking vital market growth.
Relevant: CDR.fyi Points To Market Growth, With Nearly 15M Tonnes Of Contracted CDR By May 2025
Pricing for engineered CDR remained at ~$180, while nature-based solutions increased from $17 last year to $25 by mid-2025, and avoidance credits remained at ~$3.
The AlliedOffsets report forecasts that going forward, biomass-based approaches might be challenged by feedstock constraints, while other technologies like enhanced rock weathering, mineralization, and marine CDR are gaining momentum.
Read more: ClimeFi Points To Unprecedented CDR Market Growth In Its Q2 Of 2025 Review
Although CDR is facing reduced public financial support, the report finds that private capital is driving the market growth successfully so far.
