Rising NBS/mCDR/ERW supply pressures engineered DAC demand
Key Questions
How is nature-based solutions scaling affecting engineered CDR demand?
NBS volumes are growing rapidly with JPMorgan committing 60kt and Boeing 40kt, while Frontier's $1B fund and Rainbow issuer approval broaden permanent supply options. This expansion creates competitive pressure on engineered approaches such as DAC.
What role is enhanced rock weathering playing in the CDR market?
ERW is gaining traction due to improved MRV methods and co-benefits, positioning it as a competitor to DAC. The method benefits from lower costs and additional agricultural advantages.
What were the April durable CDR contract volumes?
April recorded approximately 1.14 million tonnes of durable carbon removals contracted, including deals involving JPMorgan. These transactions signal increasing VCM momentum for permanent removals.
How fast is the durable CDR market expanding?
The durable carbon dioxide removal market is expanding at a rate of 48.14%. This growth reflects rising corporate and investor interest in verified long-term removal solutions.
What does Frontier's approval of Rainbow mean for supply?
Frontier has approved Rainbow as a credit issuer, which broadens the availability of permanent carbon removal credits. The move helps scale high-quality supply for corporate buyers.
How are long-term offtake agreements changing VCM demand?
VCM demand is shifting toward long-term offtake contracts as companies seek durable, verifiable removals. This trend supports project developers like NativState in scaling improved forest management activities.
What impact do Article 6 and CORSIA rules have on credit value?
Corresponding Adjustments under Article 6 have become the primary determinant of a carbon credit's usability and value after COP29. CORSIA further influences pricing for eligible international credits.
What financing changes are needed to scale permanent CDR?
Carbon credit markets require new financing models that raise prices and reduce volatility to scale permanent removals. Current structures limit investment in high-quality, durable solutions.
NBS scaling (JPM 60kt, Boeing 40kt); Frontier $1B, Rainbow issuer approval broadens permanent supply. ERW gaining traction with MRV focus and co-benefits, competing with DAC. April 1.14Mt durable contracts and new NTT DATA offtake signal VCM momentum; durable CDR market expanding at 48.14%.