Interview: Practitioners on Carbon removal procurement & offtakes — what they wish they knew earlier

Global corporate carbon removal purchases exceeded $1.4 billion in cumulative commitments by the end of 2025, yet fewer than 12% of contracted tonnes had been physically delivered, according to CDR.fyi tracking data. The gap between procurement ambition and operational delivery defines the carbon removal market today: buyers signing advance purchase agreements for technologies that remain pre-commercial, suppliers struggling to meet quality and volume guarantees, and intermediaries building marketplace infrastructure for a product that does not yet exist at scale. Seven practitioners across corporate procurement, project development, and carbon removal brokerage shared the lessons they wish someone had explained before they committed budgets, reputations, and organizational capital to this emerging market.

Why It Matters

The voluntary carbon market for removal credits is undergoing a fundamental shift from avoidance-based offsets toward durable carbon removal. Microsoft, Stripe, Google, JPMorgan, and over 100 other companies have collectively committed more than $2 billion to carbon dioxide removal (CDR) purchases through mechanisms including Frontier's advance market commitment, direct bilateral offtakes, and portfolio-style procurement through intermediaries (Frontier, 2025). The Science Based Targets initiative (SBTi) now requires companies using carbon credits to prioritize removal over avoidance for residual emissions neutralization, adding regulatory pressure to what was previously a voluntary market signal.

The financial dynamics are unlike any other procurement category. Engineered carbon removal costs currently range from $400 to $1,200 per tonne for direct air capture (DAC), $100 to $350 per tonne for enhanced rock weathering (ERW), and $50 to $200 per tonne for biochar, compared to $5 to $30 per tonne for conventional avoidance-based offsets (CDR.fyi, 2025). Procurement teams accustomed to minimizing per-unit costs must instead evaluate quality, permanence, additionality, and delivery risk across a technology portfolio where no single pathway has reached commercial maturity. Decisions made in 2026 on supplier relationships, contract structures, and portfolio allocation will determine which buyers have secured credible removal capacity when demand surges under tightening net-zero commitments by 2030.

Key Concepts

Navigating carbon removal procurement requires familiarity with the terminology and mechanisms shaping this market.

Durable Carbon Removal (DCR): Carbon dioxide removal approaches that store CO2 for 1,000 years or longer. DAC with geological storage, enhanced rock weathering, and mineralization qualify under most durability frameworks. Distinction from short-duration biological sequestration (forests, soil carbon) is critical for procurement credibility.

Advance Market Commitment (AMC): A binding financial commitment to purchase a specified volume of carbon removal at a guaranteed price, made before production capacity exists. Frontier, the Stripe-led initiative, pioneered this model by pooling $1 billion in buyer commitments to underwrite early-stage CDR suppliers and accelerate cost curve reductions.

Measurement, Reporting, and Verification (MRV): The process of quantifying how much CO2 a project actually removes and stores, verified by independent third parties. MRV methodologies for engineered removal vary significantly across registries, and inconsistent standards remain a major procurement pain point.

Offtake Agreement: A contract between a CDR supplier and buyer specifying volume, price, delivery timeline, and quality criteria. Pre-delivery offtakes carry technology risk (supplier may fail to deliver) while post-delivery spot purchases carry price risk (costs may escalate as demand grows).

Portfolio Approach: A procurement strategy that allocates spend across multiple CDR pathways at different stages of maturity and cost, balancing near-term deliverability (biochar, biomass carbon removal and storage) with long-term scalability (DAC, ocean-based removal). The portfolio approach hedges technology risk and supports a broader range of innovation.

What's Working

Practitioners identified several strategies producing measurable results and building organizational capacity.

Portfolio-based procurement is outperforming single-technology bets. Microsoft's carbon removal program has contracted with over 30 suppliers across DAC, enhanced weathering, biomass carbon removal and storage (BiCRS), ocean alkalinity enhancement, and biochar, allocating roughly 60% of spend to near-commercial pathways and 40% to frontier technologies. This diversification protected Microsoft when two DAC suppliers experienced construction delays in 2025, as biochar and BiCRS projects delivered enough tonnes to keep the company's removal trajectory on track. The portfolio model also generates internal learning across technology types, enabling procurement teams to assess emerging suppliers more effectively.

Milestone-based payment structures are aligning buyer and supplier incentives. Rather than paying the full contract value upon signing, leading buyers have adopted staged payment schedules tied to construction milestones, commissioning targets, and verified delivery. Stripe's Climate program structures payments at 20% upon contract execution, 30% upon facility commissioning, and 50% upon verified tonne delivery, with clawback provisions if delivery falls below 80% of contracted volume. This structure gives suppliers working capital while protecting buyers from total loss if a project fails.

Third-party verification and registry infrastructure is maturing. Puro.earth, the world's first carbon removal credit registry, now lists over 60 verified suppliers across 12 removal methodologies, with standardized MRV protocols for each pathway. Isometric, launched in 2023, has established a science-first registry requiring peer-reviewed methodologies and independent verification for every credit issued. Buyers report that registry verification has reduced due diligence timelines from 6 to 12 months per supplier to 4 to 6 weeks for registry-listed projects, substantially lowering transaction costs.

Collaborative procurement pools are achieving price reductions and supplier access that individual buyers cannot. Frontier's pooled AMC model aggregated commitments from Stripe, Alphabet, Meta, Shopify, McKinsey, and over 50 other companies, creating a $1 billion demand signal that enabled 30-plus suppliers to raise project finance and begin construction. Individual participants gained access to a diversified portfolio of removal projects at lower per-buyer transaction costs than bilateral contracting, while suppliers gained the revenue certainty needed to secure project financing from banks and infrastructure investors.

What's Not Working

Practitioners were equally direct about the failures and systemic issues plaguing the market.

Delivery timelines remain chronically optimistic. Of the carbon removal tonnes contracted for delivery by 2025, fewer than 40% were delivered on schedule, according to CDR.fyi tracking data. Direct air capture projects have experienced average construction delays of 18 to 24 months due to permitting timelines, equipment supply chain bottlenecks, and engineering challenges at scales never previously attempted. Enhanced rock weathering projects face MRV delays as baseline soil measurements require multi-year monitoring periods before net removal can be confidently quantified. Practitioners report that supplier delivery projections should be discounted by at least 30 to 50% for planning purposes.

MRV inconsistency across methodologies and registries creates buyer confusion and credibility risk. Biochar projects, for example, use varying assumptions about carbon persistence ranging from 100 years to 10,000 years depending on pyrolysis temperature, feedstock, and soil conditions. Enhanced rock weathering MRV relies on dissolution rate models with uncertainty ranges of 30 to 60% at the individual project level. Procurement teams that purchased removal credits based on one registry's methodology found those credits challenged by stakeholders using a different standard, creating reputational exposure even for good-faith buyers.

Pricing opacity undermines market efficiency. Unlike commodity markets with transparent price discovery, carbon removal transactions are predominantly bilateral and confidential. A practitioner at a Fortune 500 company described paying $600 per tonne for DAC removal credits from the same supplier that charged a competitor $425 per tonne for a larger volume commitment, with no mechanism to discover this pricing disparity until industry networking revealed the gap. The absence of standardized pricing benchmarks forces buyers to rely on supplier-provided cost estimates without independent validation.

Greenwashing adjacency is damaging corporate programs. Companies that announced high-profile removal commitments in 2021 and 2022 face media scrutiny when delivery shortfalls emerge, even when delays are attributable to supplier-side construction challenges outside the buyer's control. The conflation of removal credits with lower-quality avoidance offsets in public discourse has led some corporate sustainability teams to deprioritize removal procurement in favor of less visible emission reduction investments that carry lower reputational risk, exactly the opposite of the behavior needed to scale the CDR market.

Key Players

Established Companies

• Microsoft: Largest corporate CDR buyer with over $200 million committed across 30-plus suppliers, publishing annual progress reports on delivery and methodology learnings
• Stripe: Pioneer of advance market commitments through Stripe Climate, allocating 1% of revenue to CDR purchases and co-founding Frontier
• Swiss Re: Reinsurer that committed to purchasing $10 million per year in carbon removal credits, applying insurance risk assessment frameworks to CDR supplier evaluation
• Equinor: Energy company investing in Northern Lights, Europe's first commercial-scale CO2 transport and storage project in the Norwegian North Sea
• Occidental Petroleum: Developer of the Stratos DAC Hub in Texas, the largest direct air capture facility under construction at 500,000 tonnes per year capacity

Startups and Innovators

• Climeworks: Swiss DAC company operating the Mammoth plant in Iceland (36,000 tonnes per year) and developing next-generation facilities targeting $300 to $400 per tonne
• Lithos Carbon: Enhanced rock weathering company deploying crushed basalt on agricultural land with proprietary MRV using soil sampling and geochemical modeling
• Charm Industrial: Bio-oil sequestration company injecting pyrolyzed biomass into geological formations, offering one of the lowest-cost engineered removal pathways at $200 to $400 per tonne
• CarbonCure Technologies: Injects captured CO2 into concrete during mixing, permanently mineralizing carbon in building materials

Investors and Funders

• Frontier (Stripe-led AMC): Pooled advance market commitment with $1 billion in buyer commitments underwriting 30-plus CDR suppliers
• Lowercarbon Capital: Venture capital firm with over $800 million in climate tech investments including multiple CDR startups
• First Movers Coalition (World Economic Forum): Public-private partnership where 95 companies across 10 sectors commit to purchasing CDR and other breakthrough climate technologies

Action Checklist

• Define a CDR procurement policy specifying minimum durability thresholds (1,000 years or greater for durable removal claims), acceptable MRV standards, and target portfolio allocation across technology pathways
• Engage with 2 to 3 CDR registries (Puro.earth, Isometric, or equivalent) to evaluate pre-verified suppliers and reduce due diligence timelines
• Structure offtake contracts with milestone-based payment schedules including commissioning gates, delivery verification triggers, and clawback provisions for material shortfalls
• Allocate CDR portfolio spend across near-commercial pathways (biochar, BiCRS) for near-term delivery and frontier pathways (DAC, ocean alkalinity enhancement) for long-term scalability
• Join a collaborative procurement mechanism such as Frontier or First Movers Coalition to access pooled pricing, diversified supplier portfolios, and shared due diligence resources
• Establish internal capacity to evaluate MRV methodologies, including training procurement staff on lifecycle carbon accounting and permanence assessment frameworks
• Build delivery delay contingency into net-zero planning by applying a 30 to 50% discount to supplier delivery timelines for budgeting and reporting purposes
• Track the CDR.fyi database quarterly to monitor supplier delivery performance, market pricing trends, and new entrants

FAQ

Q: How should procurement teams decide between purchasing removal credits now at high prices versus waiting for costs to decline? A: Early procurement provides three advantages that offset the price premium: securing supply relationships before demand surges under net-zero deadlines, building organizational competency in CDR evaluation and contracting, and generating the demand signal that suppliers need to raise project finance and scale production. Practitioners recommend allocating 20 to 30% of anticipated long-term CDR budget to current purchases while structuring remaining commitments as forward offtakes at declining price curves. Frontier's portfolio data shows that buyers who committed in 2022 to 2023 secured average prices 25 to 35% below 2025 spot market rates for equivalent pathways.

Q: What due diligence should buyers perform on CDR suppliers beyond registry verification? A: Registry listing is necessary but not sufficient. Buyers should verify project financing status (fully funded vs. seeking capital), engineering and construction team track record, feedstock or energy supply contracts for operational facilities, and insurance coverage for delivery failures. Request references from other buyers who have received delivered tonnes, not just contracted tonnes. Evaluate the supplier's MRV methodology against independent scientific literature, not just registry standards. For enhanced rock weathering and ocean-based removal, assess whether the monitoring period is long enough to demonstrate net removal versus simply mineral dissolution.

Q: How do European procurement teams navigate the overlap between voluntary CDR purchases and EU compliance markets? A: The EU ETS does not currently recognize voluntary carbon removal credits for compliance purposes, though the EU Carbon Removal Certification Framework (CRCF) adopted in 2024 establishes a pathway for future integration. Procurement teams should treat voluntary CDR purchases as complementary to, not substitutable for, ETS compliance obligations. Structure CDR procurement under Scope 1 and 2 residual emissions neutralization aligned with SBTi guidance, keeping clear documentation separating voluntary removal from compliance obligations. Monitor CRCF implementation timelines, as the framework may create new demand channels and quality standards that affect voluntary market pricing by 2028.

Q: What contract terms protect buyers from supplier failure in an immature market? A: Essential protective terms include milestone-based payment schedules with no more than 20 to 25% paid at contract signing, volume delivery guarantees with financial penalties for shortfalls exceeding 20% of contracted amounts, technology performance warranties specifying minimum capture efficiency and permanence characteristics, and parent company or escrow guarantees for pre-revenue startups. Include force majeure definitions that distinguish genuine project challenges from business failure, and negotiate substitution rights allowing replacement tonnes from alternative suppliers if the contracted supplier cannot deliver within an agreed grace period.

Sources

• CDR.fyi. (2025). Carbon Dioxide Removal Purchases Tracker: 2025 Annual Summary. San Francisco: CDR.fyi.
• Frontier. (2025). Advance Market Commitment for Carbon Removal: Portfolio Progress Report 2025. San Francisco: Stripe, Inc.
• Science Based Targets initiative. (2025). Corporate Net-Zero Standard: Guidance on Carbon Credits and Removals. London: SBTi.
• Puro.earth. (2025). Carbon Removal Marketplace: Registry Standards and Verified Supplier Directory. Helsinki: Puro.earth Oy.
• Microsoft. (2025). Carbon Removal Portfolio: Lessons from Procurement at Scale. Redmond, WA: Microsoft Corporation.
• International Energy Agency. (2025). Direct Air Capture: Technology Deep Dive and Cost Projections. Paris: IEA.
• Isometric. (2025). Science-Based Carbon Removal Verification: 2025 Methodology Review. London: Isometric Science Ltd.