Data story: key signals in Carbon removal procurement & offtakes
The 5–8 KPIs that matter, benchmark ranges, and what the data suggests next. Focus on unit economics, adoption blockers, and what decision-makers should watch next.
The carbon dioxide removal (CDR) offtake market exploded from $14 million in 2020 to approximately $1.5 billion in 2024—nearly double the $815 million value of traditional reduction and avoidance credits. In the first half of 2025 alone, CDR offtake contracts reached 61.5 million tonnes of CO2 equivalent, with Microsoft capturing 91% of that volume through aggressive procurement strategies. These numbers signal a fundamental shift: carbon removal has moved from experimental purchases by climate-conscious pioneers to a strategic corporate asset class commanding multi-billion-dollar commitments.
Yet the market remains extraordinarily concentrated. Microsoft, Google, and the Frontier coalition collectively represent 80% of all durable CDR purchases. For investors, procurement leaders, and climate strategists, understanding the key performance indicators that separate successful offtake strategies from expensive failures has become mission-critical.
Why It Matters
The voluntary carbon market is undergoing a credibility reckoning. High-profile investigations have exposed the quality problems with traditional offset credits—forest preservation projects that weren't additional, renewable energy certificates that funded already-economic projects, and verification systems that failed to detect fraud. Against this backdrop, durable carbon removal offers something different: permanent, measurable, and verifiable sequestration of atmospheric CO2.
The supply-demand imbalance is stark. According to the Intergovernmental Panel on Climate Change (IPCC), achieving net-zero by 2050 requires removing 7-9 billion tonnes of CO2 annually. Current verified durable removals total approximately 2 million tonnes annually—0.1% of what's needed. This gap represents both an enormous market opportunity and a genuine climate imperative.
For corporate buyers, CDR procurement serves multiple strategic functions beyond environmental impact. It demonstrates climate leadership to stakeholders, hedges against future regulatory requirements for removal-based neutralization, and secures supply in a market where high-quality capacity is rapidly being locked up. As of early 2025, 62% of high-quality biochar capacity through 2025 was already committed through offtake agreements, with 28% secured through 2026.
The financial stakes are substantial. Multi-year offtake agreements secure an average 31% cost savings compared to spot purchases, according to CDR.fyi market analysis. Organizations delaying procurement face not just higher prices but potential inability to access quality supply at any price.
Key Concepts
Offtake Agreements vs. Spot Purchases
An offtake agreement commits a buyer to purchase a specified quantity of carbon removal credits over a defined period, typically 3-10 years. These agreements provide suppliers with revenue certainty to finance capital-intensive projects while giving buyers price stability and supply security. Spot purchases, by contrast, involve buying credits for immediate or near-term delivery at prevailing market rates.
Durable vs. Non-Durable Removal
Durability refers to how long captured carbon remains sequestered. The Science Based Targets initiative (SBTi) distinguishes between durable removal (storage for 1,000+ years) and non-durable removal (shorter timeframes). Technologies like direct air capture with geological storage (DACCS) and bioenergy with carbon capture and storage (BECCS) offer durable removal, while enhanced weathering and biochar occupy intermediate positions.
Additionality and Verification
Additionality means the removal would not have occurred without the buyer's payment. Verification involves third-party confirmation that claimed removals actually happened. The emerging registry ecosystem—including Puro.earth, Isometric, and the CDR.fyi database—provides increasing transparency on delivered versus contracted volumes.
Advance Market Commitments (AMCs)
AMCs are coordinated buyer commitments to purchase future supply at predetermined prices, designed to accelerate technology development by guaranteeing demand. Frontier Climate, the largest CDR-focused AMC, has contracted approximately $350 million across 43 projects for roughly 635,000 tonnes of removal.
The 7 KPIs That Matter
1. Price Per Tonne by Technology
| Technology | 2024 Range (USD) | 2030 Projected | Key Drivers |
|---|---|---|---|
| Biochar (BCR) | $100-250 | $80-180 | Feedstock costs, process efficiency |
| Enhanced Rock Weathering | $80-200 | $60-150 | Application logistics, MRV costs |
| Direct Air Capture (DAC) | $400-1,000 | $200-400 | Energy costs, capital intensity |
| BECCS | $150-350 | $100-250 | Biomass supply, storage infrastructure |
| Ocean Alkalinity | $100-300 | $75-200 | Scaling challenges, MRV complexity |
| Geological Injection | $200-500 | $150-350 | Well development, monitoring |
2. Delivery Rate
Definition: Percentage of contracted tonnes actually delivered and verified.
| Maturity Stage | Current Delivery Rate | Target by 2027 |
|---|---|---|
| Pre-commercial pilots | <10% | 40-60% |
| Early commercial | 15-35% | 60-80% |
| Scaled operations | 50-75% | >90% |
Context: As of late 2024, only approximately 0.3% of Frontier's contracted tonnes had been delivered. This reflects the early stage of most CDR technologies rather than supplier failure—but it underscores the importance of portfolio diversification.
3. Supply Lock-Up Rate
Definition: Percentage of available capacity committed through multi-year offtakes.
| Timeframe | High-Quality Biochar | DAC Capacity | BECCS Capacity |
|---|---|---|---|
| Through 2025 | 62% | 85% | 70% |
| Through 2026 | 28% | 45% | 35% |
| Through 2030 | 15% | 30% | 25% |
Implication: Late entrants to CDR procurement face genuine supply constraints, not just price increases.
4. Portfolio Concentration Risk
Definition: Exposure to single technology, geography, or supplier failure.
| Risk Metric | Red Flag | Acceptable | Best Practice |
|---|---|---|---|
| Single technology >50% | High risk | <40% | <30% |
| Single supplier >30% | High risk | <25% | <15% |
| Single geography >60% | Medium risk | <50% | <40% |
5. Verification Lead Time
Definition: Time from removal occurrence to verified credit issuance.
| Technology | Current Average | Target | Excellence |
|---|---|---|---|
| Biochar | 6-12 months | 3-6 months | <3 months |
| DAC | 3-6 months | 1-3 months | <1 month |
| Enhanced Weathering | 12-24 months | 6-12 months | <6 months |
| BECCS | 6-12 months | 3-6 months | <3 months |
6. Cost Savings from Multi-Year Commitments
| Contract Length | Average Discount vs. Spot | Volume Threshold |
|---|---|---|
| 1-2 years | 10-15% | >1,000 tonnes |
| 3-5 years | 20-31% | >5,000 tonnes |
| 6-10 years | 25-40% | >25,000 tonnes |
7. Credit Quality Score Distribution
| Rating Category | Price Premium | Market Share (2024) |
|---|---|---|
| AAA-A (highest) | $14.80/tonne average | 15% |
| BBB-BB | $8.50/tonne average | 25% |
| B-CCC (lowest) | $3.50/tonne average | 60% |
What's Working
Aggregated Buying Power
The Frontier coalition model—pooling demand from multiple corporate buyers—has proven effective at reducing transaction costs and enabling access to early-stage technologies. By combining commitments from Stripe, Google, Shopify, Meta, McKinsey, and others, Frontier can offer suppliers meaningful contract sizes while spreading risk across buyers. Their open-sourced offtake agreement template, released in August 2024, further reduced transaction friction.
Technology-Specific Offtake Structures
Sophisticated buyers are matching contract structures to technology risk profiles. For mature technologies like biochar, they use fixed-price, high-volume contracts. For emerging technologies like DAC, they accept higher per-tonne costs in exchange for smaller volumes and milestone-based payments that reduce prepayment risk.
Integrated Industrial Approaches
The most cost-effective CDR projects embed removal into existing industrial operations. Exterra Carbon Solutions extracts critical minerals from mine tailings while mineralizing CO2. Alt Carbon deploys enhanced rock weathering on tea plantations, creating co-benefits for soil health. These integrated models achieve 40-60% lower costs than standalone removal facilities.
What's Not Working
Market Concentration
Microsoft's dominance—representing 64-91% of durable CDR purchases depending on the quarter—creates systemic risk. If Microsoft's procurement strategy shifts, the entire market could contract. Smaller corporate buyers struggle to compete for limited high-quality supply against Microsoft's multi-billion-dollar purchasing power.
Verification Bottlenecks
The MRV (measurement, reporting, verification) infrastructure hasn't scaled with demand. Enhanced rock weathering projects face 12-24 month verification delays because the science of measuring long-term sequestration in agricultural soils remains contested. This creates cash flow challenges for suppliers and uncertainty for buyers.
Greenwashing Adjacency
Despite focusing on high-integrity removal, the CDR market operates adjacent to a voluntary carbon market plagued by credibility issues. Buyers must navigate reputational risk from association with problematic offset projects, even when their own CDR purchases are legitimate. Clear communication about the difference between removal and avoidance credits remains essential.
Key Players
Established Leaders
- Microsoft — The dominant CDR buyer globally, committing $2-4 billion in long-term contracts through early 2025, including landmark deals with AtmosClear (6.75 Mt BECCS), Vaulted Deep (4.9 Mt biomass injection), and CO280 (3.7 Mt DAC). Their Climate Innovation Fund also invests in CDR technology development.
- Google/Alphabet — Purchased 728,300 tonnes across 16 deals in 2024 for approximately $100 million. Founding member of Frontier and active in early-stage prepurchase programs.
- Stripe — Pioneer in CDR procurement, launching Stripe Climate in 2020 and co-founding Frontier. Continues to purchase across technology pathways despite smaller corporate scale.
- JPMorgan Chase — Joined Frontier in 2023 and contracted 500,000 tonnes in Q2 2025, including both BECCS and DACCS technologies, signaling financial sector engagement.
Emerging Startups
- Charm Industrial — Converts agricultural waste into bio-oil injected underground. First Frontier offtake recipient ($53 million), demonstrating BiCRS pathway viability.
- Heirloom Carbon — Direct air capture using limestone, backed by significant venture funding and government contracts.
- Lithos Carbon — Enhanced rock weathering on agricultural land, creating farmer co-benefits while sequestering CO2.
- CarbonRun — River liming approach to ocean alkalinity enhancement, contracted by Frontier for 55,442 tonnes through 2030.
- Vaulted Deep — Geological injection of organic waste slurry, securing $58.3 million Frontier offtake for 152,480 tonnes.
Key Investors & Funders
- Frontier Climate — The $1 billion+ advance market commitment comprising Stripe, Alphabet, Shopify, Meta, McKinsey, Autodesk, H&M Group, JPMorgan Chase, and Workday. Has contracted approximately $350 million across 43 projects.
- Breakthrough Energy Ventures — Bill Gates-founded fund actively investing in DAC, BECCS, and novel CDR approaches.
- Lowercarbon Capital — Climate-focused VC backing multiple CDR startups including Heirloom and Running Tide.
- U.S. Department of Energy — Funding DAC hubs through the Bipartisan Infrastructure Law, with $3.5 billion allocated.
Examples
Microsoft's AtmosClear Deal (Q2 2025): Microsoft contracted 6.75 million tonnes of BECCS-based removal—the largest single CDR deal in history. The agreement spans multiple years with delivery beginning in 2027. Key success factors: Microsoft's willingness to commit scale capital, AtmosClear's project-financed infrastructure, and long-term price certainty enabling capital formation. This single deal exceeded the entire 2024 annual CDR market volume of 8.3 million tonnes.
Frontier's Alt Carbon Prepurchase (September 2024): Alt Carbon became the first India-headquartered company to receive a Frontier prepurchase, securing $500,000 to deploy enhanced rock weathering on tea plantations in Darjeeling. The integrated approach—improving soil health for tea cultivation while sequestering CO2—demonstrates how CDR can create agricultural co-benefits. Expected delivery: approximately 285 tonnes, with pathway to scale across Indian tea estates.
Google's Diversified Portfolio (2024): Google's 728,300 tonnes across 16 deals exemplifies portfolio diversification. Technologies include biochar, enhanced weathering, DAC, and biomass pathways. Geographic distribution spans North America, Europe, and emerging markets. No single technology exceeds 35% of portfolio. This approach reduces delivery risk while supporting technology diversity.
Action Checklist
- Assess current carbon neutrality claims and identify removal requirements under evolving SBTi guidance
- Calculate required removal volume based on residual emissions projections through 2030 and 2050
- Evaluate budget capacity for CDR procurement, recognizing current prices of $100-400/tonne
- Develop technology diversification strategy limiting single-pathway exposure to <40%
- Identify potential aggregation partners (industry peers, Frontier membership) to access better pricing
- Establish verification requirements and registry preferences before supplier negotiations
- Build internal capacity for CDR contract evaluation, including delivery risk assessment
- Create stakeholder communication plan distinguishing removal purchases from offset criticism
FAQ
Q: How do I evaluate whether a CDR offtake price is reasonable? A: Current market benchmarks show biochar at $100-250/tonne, enhanced weathering at $80-200/tonne, and DAC at $400-1,000/tonne. Multi-year offtakes should command 20-31% discounts versus spot prices for comparable technology and verification standards. Prices significantly below these ranges may indicate quality compromises; prices above may reflect genuinely novel approaches or premium verification. Always benchmark against the CDR.fyi database of disclosed transactions.
Q: What's the minimum commitment size to access quality CDR supply? A: Direct offtakes with major suppliers typically require 5,000+ tonnes annually. Smaller buyers can access quality supply through aggregators like Frontier (via member companies), Watershed, or Patch, which pool demand. Stripe Climate enables any Stripe customer to allocate revenue to CDR regardless of volume. Expect minimum transaction sizes of $50,000-100,000 for meaningful portfolio diversification.
Q: How should I think about delivery risk given low current delivery rates? A: Structure contracts with milestone-based payments rather than full prepayment. Diversify across 4-6 suppliers minimum across at least 3 technology pathways. Accept that early-stage technologies will have delivery uncertainty—the 0.3% delivery rate for Frontier's portfolio reflects pipeline development, not failure. Build 20-30% overcapacity into volume targets to absorb partial delivery. Monitor supplier progress quarterly against announced milestones.
Q: Should I wait for prices to decline before committing? A: The supply lock-up data suggests waiting is risky. With 62% of 2025 biochar capacity and 85% of DAC capacity already committed, late entrants face genuine scarcity, not just higher prices. Multi-year offtakes at current prices lock in 20-31% savings versus future spot purchases while securing access to quality supply. The organizations achieving the best outcomes are those building portfolios now rather than timing the market.
Q: How do CDR credits interact with carbon pricing and regulatory requirements? A: Currently, CDR credits primarily serve voluntary commitments and anticipatory compliance. The EU Carbon Removal Certification Framework (CRCF), expected to finalize in 2025-2026, will establish standards for removal credit quality in regulated markets. California and other jurisdictions are developing similar frameworks. Organizations building CDR portfolios now are positioning for regulatory recognition while meeting voluntary commitments. Track regulatory developments through the Carbon Removal Certification Framework proceedings and national implementation guidance.
Sources
- CDR.fyi, "2025 Q3 Durable CDR Market Update," October 2025
- Frontier Climate, "Portfolio and Prepurchase Announcements," September 2024
- FastMarkets, "CDR Offtakes Reach 61.5 Million tCO2e in H1 2025," July 2025
- World Economic Forum, "Building the Financial Architecture to Scale Carbon Removal," December 2025
- Carbon Direct, "Ten Insights for Buyers from Our 2024 Voluntary Carbon Market Report," 2024
- IPCC, "Climate Change 2023: Synthesis Report," Contribution of Working Groups I, II and III to the Sixth Assessment Report
- Microsoft, "Environmental Sustainability Report 2024," Annual disclosure
- Frontier Climate, "Open-Source Offtake Agreement Template," GitHub repository, August 2024
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