The carbon removal industry faces a critical design flaw. Two weeks ago, I published an article examining why we’re not on track to achieve gigatonne-scale carbon removal, sparking widespread discussion across the sector. The core argument resonated strongly: our current market structure is designed for corporate accounting rather than atmospheric impact. If we’re serious about climate goals, we need to address the fundamental “who pays” question that’s preventing real scale.
The Scale Challenge We’re Not Meeting
The Rocky Mountain Institute has shown that we need 10 billion tonnes of carbon removal annually by 2050, which means 285 million tonnes yearly by 2030. Yet current removals remain in the hundreds of thousands of tonnes – nowhere near the trajectory needed.
This isn’t happening because the technology doesn’t exist or there’s insufficient interest. It’s happening because we’ve built a market optimized for the wrong priorities. The current system primarily serves corporate sustainability departments seeking precise accounting for emissions claims rather than maximizing atmospheric carbon reduction.
Look at today’s buyer landscape: Microsoft represents over 60% of all carbon removal purchases, with Frontier and Google representing just 5% and 4% respectively. Meanwhile, there are now more than 500 carbon removal startups competing for this tiny pool of corporate buyers.
The Three Market Design Barriers Preventing Carbon Removal Scale
The first structural barrier is our obsession with measurement precision. While accurate measurement is necessary, our current approach prioritizes perfect verification over scalability. This creates a paradox where we’re measuring small amounts of carbon removal with great precision while failing to implement solutions that could remove vastly more carbon with reasonable (but not perfect) confidence.
The second barrier is our fixation on perfect permanence. Today’s market rewards approaches promising to keep carbon locked away for 1000+ years more than methods that could remove larger quantities for shorter timeframes. While permanence matters, this narrow focus ignores atmospheric reality: removing carbon NOW matters tremendously for preventing climate tipping points, even if it’s not stored forever.
The third barrier is the additionality trap. Current standards require that carbon removal projects wouldn’t happen without carbon credit revenue. This creates bizarre situations where nature-based solutions struggle to qualify (as farmers have other motivations to adopt carbon-storing practices) and successful CDR suppliers risk losing their qualification once they become financially viable. We’ve created a system that penalizes success.
These market design barriers aren’t just academic concerns. While we debate measurement precision and perfect permanence in conference rooms, the physical world isn’t waiting. Coral reefs are bleaching at unprecedented rates, ice sheets continue to melt, and we’re approaching irreversible tipping points in several Earth systems. The climate crisis demands immediate action at scale, not perfect accounting. We’re optimizing spreadsheets while ecosystems collapse.
Who Pays? The Fundamental Question We’re Avoiding
The most fundamental problem underlying carbon removal’s scaling crisis is that we haven’t answered the “who pays” question satisfactorily. The current model places the entire financial burden on corporate sustainability departments with limited budgets and narrow mandates.
This is a structural dead-end. Sustainability departments simply don’t have the resources to fund gigatonne-scale removal, nor is there adequate incentive for them to do so. Their primary concerns are meeting specific corporate commitments while minimizing reputational risk – not maximizing atmospheric impact.
Some argue that government funding is the ultimate answer to this scaling challenge. In an ideal world, nation states would indeed step up with massive public investment in carbon removal as infrastructure. But our current geopolitical reality shows both governments and corporations retreating from climate commitments under economic and political pressures. Waiting for sufficient public funding before redesigning market structures means delaying critical scaling efforts. The more practical path forward is organizing private capital more effectively now, creating systems that can operate at meaningful scale with or without eventual government support.
Without resolving this financial question, all other improvements remain futile in practice. We need funding mechanisms beyond traditional offsetting models if we want to approach the scale climate science demands.
A Call for Industry Reset: Next Steps for Key Stakeholders
The time has come for an industry-wide reset focused on scaling impact rather than perfecting accounting. Here’s what key stakeholders should do next:
For Standards Bodies and Registries: Develop balanced portfolio approaches that value both immediate scale and long-term durability. Create frameworks that accommodate different removal approaches based on their scaling potential, not just their verification precision or permanence. Reassess additionality requirements that penalize financial sustainability.
For Major Buyers like Microsoft and Frontier: Microsoft has already pioneered diversified procurement with different removal approaches – this model needs wider adoption. Use your market influence to encourage other buyers to develop similar balanced portfolios that value both scale and permanence. Signal to the market collectively that scale matters as much as precision, and help emerging buyers develop procurement strategies that support diverse removal pathways.
For Market Infrastructure Providers: Develop mechanisms that connect carbon removal to value creation rather than only cost centers. Build platforms that enable creative funding models like advertising-supported removal or consumer-facing integrations. Create tools that lower transaction costs for suppliers.
For Industry Organizations: Convene a “Carbon Removal Reset Summit” focused specifically on redesigning market structures for scale. This isn’t about technology innovation – it’s about business model innovation. Bring together buyers, suppliers, standards bodies, and policymakers to align on clear scaling targets and the structural changes needed to achieve them.
Beyond Offsetting: New Financial Models for Atmospheric Impact
Achieving gigatonne scale requires expanding beyond the offsetting model entirely. We need to position carbon removal as value-creating rather than purely cost-generating.
Imagine a scenario where companies incorporate carbon removal into their products as a premium feature, funded by consumers willing to pay slightly more. Or advertising-supported models where sponsors fund removal in exchange for targeted messaging. Or loyalty programs that convert points into meaningful climate impact.
These approaches distribute costs beyond sustainability budgets and create new value streams that can support vastly greater scaling. The most promising examples don’t treat carbon removal as an isolated expense but integrate it into core business operations where it can generate revenue or competitive advantage.
The Path Forward: Atmospheric Impact Above All
The carbon removal industry stands at a critical juncture. We can continue optimizing for accounting precision within existing frameworks – and fail to reach meaningful scale. Or we can redesign the market around atmospheric impact – creating approaches that might not satisfy current accounting requirements but could actually deliver the scale our climate needs.
This isn’t about abandoning rigor or quality. It’s about balancing those concerns with the urgent need for scale. The encouraging response to this conversation suggests the industry is ready for this reset. The question is whether we’ll make the fundamental changes needed before it’s too late.
The climate doesn’t care about perfect accounting or verification. It responds only to the actual amount of carbon in the atmosphere. It’s time our market designs aligned with this simple reality.
Paul Gambill is the co-founder and former CEO of Nori, one of the first carbon removal marketplaces. He now writes at “Inevitable & Obvious” where he shares insights on category creation and building solutions that can achieve meaningful climate impact.
