The Journey to Net Zero: Why Engineered Removals are Key

To illustrate the current climate emergency, picture a sink filled with greenhouse gases (GHG). At present, the world’s global GHG emissions are filling the sink and we are rapidly getting close to the point of overflow.

It is no longer enough to just reduce the rate of flow into the bathtub; we must now also widen the drain and remove more GHGs from the atmosphere. Is the real-world situation a little more complicated than this? Yes. Nonetheless, more emissions need to be removed from the atmosphere if we are going to follow the IPCC’s (the UN body analysing climate change) recommendations of limiting global warming to 1.5ºC above pre-industrial levels.

A Net Zero target, as defined by the SBTI (an independent entity promoting best practice in setting Net Zero targets), involves setting an emission reduction target that limits global warming to 1.5ºC.

Once companies have measured their footprint and set this target, they should reduce their GHG emissions first and foremost, and then neutralise unavoidable residual emissions through carbon dioxide removal (CDR) projects. The graph above illustrates this concept; note how the use of CDR increases in order for global emissions to become net negative.

The current trend in the market, led mostly by large corporations, is to submit Net Zero targets, which are achieved by neutralising emissions by using only nature-based removals (e.g. reforestation projects). While there is merit to this approach, we believe that utilising a variety of CDR solutions, including new technologies, is required, as there are different risks and co-benefits associated with each.

Engineered carbon removals provide significantly longer permanence (i.e. how long GHG stay out of the atmosphere) compared to nature-based solutions. They also have the potential to be scaled quickly. Rapid expansion of CDR techniques is therefore required: the IPCC states that, in order to limit global warming to 1.5ºC above pre-industrial levels, CDR across a range of technologies is necessary on a scale of 10 gigatonnes (Gt) per year through to 2050. For context, current offsetting activity is >0.1 Gt per year.

The challenge right now with engineered removals is that they cost significantly more than nature-based removals. This is because the technologies have not yet been industrialised, meaning that they have not yet achieved economies of scale.

At Pledge, we think it is important to include these projects as part of a wider carbon neutralisation portfolio, which is constructed like a bundled exchange-traded fund (ETF), enabling the fractionalisation of carbon credits. This provides greater access to engineered removals, allowing these new companies to generate revenue, which they can then use to access capital in order to scale. This will, ultimately, drive down the price per tonne of carbon captured through engineered removal projects.

We are working with leading carbon removal technology companies across a range of project types. In the US, Charm Industrial converts biomass into a stable, carbon-rich liquid and then pumps it deep underground, which removes CO₂ from the atmosphere. In Sweden, Ecoera converts waste biomass into biochar, a charcoal-like substance that stores carbon. This is then added to cultivated fields to improve the soil quality. In the UK, The Future Forest Company is working on enhanced weathering, a naturally occurring process where carbon is converted into a new substance that acts as a carbon store. These are just some of the projects that we work with and include in our portfolios.

The journey to Net Zero is not a straight line and there is no silver-bullet solution to this crisis. We believe that only a holistic approach can help move the needle. At Pledge, we embrace this through our varied portfolios, which cover a range of projects and technologies to ensure that our customers have an ambitious, yet achievable neutralisation portfolio that balances costs with long-lasting carbon removal on the path to Net Zero.