❓Should we encourage or force companies to purchase carbon removal? 🗣

📈 At their most basic, these are the two options we have at our disposal to scale carbon dioxide removal (#CDR) to the gigaton scale we need: incentives and compliance.

🥕 What incentives look like:

1️⃣ Tax credits such as the Canadian ITC which 60% of CAPEX equipment costs for DAC projects.

2️⃣ Subsidies such as the €1.37b earmarked for CCUS (including DACCS) projects in Germany 

3️⃣ Direct procurement such as the €166m the Danish government just announced to purchase 1.1Mt of BioCCS removals

🥢 What compliance looks like:

1️⃣ Integration into Emission Trading Systems such as the EU ETS, which had a volume of €751b in 2022

2️⃣ A dedicated Removal Trading System as is currently being contemplated in the EU

3️⃣ Green / environmental claims legislation such as the EU Green Claims Directive mandating the use of durable CDR for any product/company claim.

💡 For a full list of options and context, check out this article on “Government as catalyst: Strategic financing paths for scaling carbon dioxide removal“: https://lnkd.in/gR6Z_PVQ

Currently, it is all incentives. But that might change soon. 

💬 What is your take? If you had to pick one: sticks or carrots? Why? Vote and then add your comments below.

#carbonremovals #carbonmarkets #climatepolicy

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