Global carbon credits ratings agency BeZero Carbon has announced its first engineered carbon removal rating. An industry-first, this rating analyses a biochar project and marks a shift towards the maturation of the nascent but essential carbon removal sector.
- Global carbon ratings agency BeZero Carbon announces the Voluntary Carbon Market’s first-ever engineered carbon removal rating with an ‘A’ rated biochar project.
- There is global consensus that engineered carbon removal is essential to reach net zero, and by 2030 annual demand for engineered carbon removal could reach between 40 and 200 million tonnes.
- While there is still confusion in the VCM, standardised ratings of engineered carbon removal projects will help bring greater transparency and maturity to the nascent sector, hopefully driving capital to the most impactful ventures.
Although corporate climate commitments are now commonplace, many focus on carbon avoidance offsets, which buyers can find difficult to understand due to the complexity of methodological approaches and ever-changing understanding of the scientific basis for estimating carbon.
This complexity and volatility have undermined trust in the voluntary carbon markets, driven by concerns about integrity in calculation and measurement. This is driving demand for carbon removal credits, especially engineered carbon removal credits, which can be generated from projects such as biochar, direct air capture (DAC) and enhanced weathering.
Demand for carbon removal credits is on the increase
Even under the most optimistic estimates, the world will require some form of carbon removal to meet net zero – which has led to demand for engineered carbon removals increasing rapidly. Today’s carbon removal market is only at 0.01% of the capacity the IPCC says will be needed by 2050.
Estimates suggest that by 2030 alone, annual demand for durable engineered carbon removal technology could reach between 40 and 200 million tonnes of CO2e, with more businesses turning towards carbon removal credits to meet their climate commitments.
Understanding the state of the carbon removals market
The state of the carbon removal markets was highlighted in the first State of Carbon Dioxide Removal report in early 203, which convened over 20 experts in the field of CDR and was led by Oxford University’s Smith School of Enterprise and the Environment.
According to the report, almost all current CDR comes from conventional removal methods on land (2 GtCO2 per year), primarily via planting trees and managing soils. Countries need to maintain and expand this, approximately doubling in 1.5°C pathways and increasing by around 50% in 2°C pathways by 2050 compared to 2020 levels.
Virtually all pathways to net zero also require new CDR technologies, such as BECCS, biochar, enhanced rock weathering and DACCS. Yet new CDR technologies make up only a tiny fraction of current CDR (0.002 GtCO2 per year). Closing the CDR gap requires rapid growth of these new CDR technologies, by a factor of 1,300 on average by 2050.
Rating a biochar project is a step forward
It is therefore essential to assess the quality of engineered carbon removal credits – to allow market participants to make informed decisions about the quality of the credits they invest in. While projects in the sector had not been eligible for the BeZero Carbon Rating so far, most often due to limited project information in the public domain, this first-of-its-kind rating reflects the positive development of the sector.
Biochar is leading the way in the engineered carbon removals sector and has contributed to over 90% of engineered carbon removals retirements to date. It is produced through a high temperature, low oxygen biomass combustion process, called pyrolysis. During pyrolysis, the molecular structure of the biomass changes to more stable forms – meaning biochar can store carbon for much longer timeframes.
BeZero Carbon has assigned its first biochar rating an ‘A’ value, meaning it has a high likelihood of achieving 1 tonne of CO2e avoidance or removal. This rating assesses the project against a number of rating risk factors, such as additionality, over-crediting, leakage, and non-permeance.
Ted Christie-Miller, director of carbon removal at BeZero Carbon said: “In any net zero scenario, there is consensus that large-scale engineered carbon removal is necessary. We are proud to be leading the way in increasing transparency in the market with the first-ever engineered carbon removal rating.
SGV Take
The rating can be taken as a signal of increasing maturity in the engineered carbon removals market. We are seeing increasing standardisation and methodological rigour across the VCM and this should make a significant difference to the strength of the market.
