Financing Carbon Removal at Scale: Opportunities and Challenges

Wednesday, April 15 | 8:30 AM – 12:30 PM | Location: Cambridge Innovation Center

While rapid and sustained emission cuts are critical to achieving global climate goals, decarbonization alone will not be sufficient to reduce the residual ‘hard-to-abate’ sectors, which are either technologically or economically prohibitive to remove. In response to this, carbon dioxide removal (CDR) is considered to be a substantial component to limit global warming to 1.5–2°C. IPCC net-zero pathways require CDR to scale to 6–10 Gt per year by 2050, a significant near-term scale up of the 2 Gt already occurring through conventional CDR methods (i.e., reforestation, land-use change, soil carbon) and 0.0014 Gt/year with novel CDR methods (i.e., biochar, bio-oil injection, enhanced weathering, direct air capture). Current financing of durable CDR depends on the voluntary carbon market (VCM), which generated 8 million tonnes of carbon removal in 2024 (0.008 Gt). The ability for existing natural and engineered solutions to achieve this scale hinders the available financing and profitability of the market. McKinsey estimates that the needed investment to cover all CDR needed is in the range of $6–16 trillion cumulative investment by 2050.

This reality necessitates critical thinking on how to finance carbon removal in many modes of operation including the voluntary carbon market, governmental policy, and broader finance interventions, among others. This workshop aims to enumerate the challenges of current carbon market schemes and to ideate new approaches, with an emphasis on financial solutions. The intention is to propose solutions that are aimed towards gigaton CDR to achieve climate goals, not merely as another market vessel for company net zero goals. The workshop will include stakeholders from across the CDR space, including experts in economics, policy, and engineering along with current players in the carbon market (verifiers, registers, carbon credit producers).

Facilitators:

• Mary Kate Lane, Impact Fellow, MIT Climate & Sustainability Consortium (MCSC) and Postdoctoral Researcher, Plata Lab at MIT
• Audrey Parker, PhD Candidate, MIT Department of Civil and Environmental Engineering