CUR8, UNDO, British Airways, and Standard Chartered Launch Pilot to Unlock Debt Financing for Carbon Removals
(IN SHORT) Four industry leaders, including CUR8, UNDO, British Airways, and Standard Chartered, have joined forces to initiate a pioneering financing pilot aimed at accelerating the growth of the carbon removals market. This partnership responds to the urgent need to expand carbon removal efforts to limit global warming to 1.5 degrees Celsius by 2050, as emphasized by the Intergovernmental Panel on Climate Change (IPCC). Carbon removal involves capturing carbon dioxide from the atmosphere and securely storing it for extended periods. This nascent industry must scale significantly to achieve net-zero emissions targets, but it faces funding challenges, particularly for larger-scale projects. While grants and venture capital support early-stage initiatives, accessing commercial debt for scale-up is often complex. CUR8, with backing from GV (Google Ventures), focuses on sourcing high-quality carbon removal credits globally. It plans to stimulate demand for these credits by enabling multi-year purchases for buyers and addressing working capital constraints for suppliers. As part of the pilot, British Airways commits to purchasing over 4,000 tonnes of carbon removal credits delivered by UNDO through enhanced rock weathering. Standard Chartered seeks to be the banking partner in this effort. The pilot’s goal is to create a model that allows carbon removal suppliers to access debt financing secured on future client demand through advanced purchase agreements, facilitating scale-up while reducing reliance on customized financing arrangements. This initiative is a crucial step toward building a more substantial carbon removal industry and ultimately achieving net-zero emissions.
(PRESS RELEASE) LONDON, 2023-Dec-20 — /Travel PR News/ — CUR8, a UK-based company dedicated to building the global market for carbon removals, in partnership with UNDO, a UK-founded, world-leading carbon dioxide removal project developer specialising in enhanced rock weathering, British Airways and Standard Chartered have launched a first-of-a-kind financing pilot to help scale up the carbon removals market. Financial solutions of this kind are a crucial step in enabling the carbon removals market to reach the multi-billion-tonne scale required, according to the IPCC, to limit global warming below 1.5 degrees.
Carbon removal is the process of removing carbon dioxide from the atmosphere and storing it safely for multiple decades and ideally centuries. Removals come in a wide range of approaches ranging from storing carbon in trees and soils to capturing carbon dioxide directly from the air and durably storing it underground or through enhanced rock weathering.
The industry is nascent and needs to scale exponentially to support climate targets to achieve net zero emissions. However, funding can be a challenge even for the most promising approaches. While grants and venture capital are generally available during the early stages, traditional banking products needed for scale, such as commercial debt, are harder to come by. CUR8, backed by GV (Google Ventures), specialises in the procurement of high quality carbon removal credits from global suppliers across the technological spectrum, and is now setting out to drive more demand for these credits by: 1) allowing buyers to access carbon removal credits through multi-year purchases; 2) alleviating working capital challenges for suppliers, often a bottleneck to achieving commercial scale. As part of this transaction, British Airways is committing to purchase more than 4,000 tonnes of carbon removal credits delivered by UNDO through enhanced rock weathering, and Standard Chartered is looking to be the banking partner.
This pilot aims to create a blueprint to enable ambitious carbon removal suppliers to scale with more available capital in the form of debt financing, secured on future client demand via advanced purchase agreements. This way, suppliers can move away from relying on bespoke financing structures, meet their working capital needs, and establish a credit history in the process. CUR8 aims to build on this pilot to further develop scale-up financing products for the carbon removals industry.
Carrie Harris, Director of Sustainability at British Airways, said:“At British Airways, carbon removals form a fundamental part of our strategy to reach net zero emissions and so we are delighted to be a part of this groundbreaking pilot. Whilst this initial purchase is relatively small, the partnership hopes to pave the way to unlock future investment in carbon removals and help accelerate the future scale-up of carbon removals technology. This collaboration will reinforce our commitment to achieving net zero by 2050 and is a long-term and necessary solution to act on our carbon emissions.”
Marta Krupinska, CEO & Co-Founder at CUR8 said: “It is clear that rapid technological and scientific innovations require appropriate, novel and abundant financing. We are delighted to be launching this pilot with UNDO, British Airways and Standard Chartered to show that debt financing in addition to venture capital is needed to unlock scalability for carbon removals. We aim to build a bridge to bankability for the most promising carbon removal suppliers who face a $5-50M scale-up financing gap.”
Marisa Drew, Chief Sustainability Officer at Standard Chartered, said “Our commitment to carbon removals recognises their critical importance in the delivery of net zero. As a Bank with a significant presence in many of the emerging markets most impacted by climate change, we are clear that high-integrity carbon markets and related removals activity can accelerate net zero progress when coupled with continued mitigation and adaptation efforts. Given this focus, we’re excited by the opportunity to partner with such mission-aligned counterparties to develop this financing structure in hopes that it will support more providers to scale up and be able to access a greater quantum of capital to remove carbon, at pace.”
Jim Mann, Founder and CEO at UNDO, said: “Our approach represents one of the most robust carbon dioxide removal solutions available today because it is permanent, highly scalable, and provides a host of co-benefits. While flying brings the world closer together, it is difficult to decarbonise. The aviation industry will require large amounts of high-quality carbon removal to meet its net zero commitments, and British Airways is leading the charge. UNDO and the carbon removal market need many more progressive partnerships like this to scale to the IPCC carbon removal goal of 10 billion tonnes a year by 2050.”
ENDS
About CUR8
Founded by serial fintech entrepreneur Marta Krupinska, renowned climate scientist Dr. Gabrielle Walker and systems change expert Mark Stevenson, CUR8 is the market maker for carbon removals. CUR8’s due diligence and monitoring underpins its ability to provide high-quality carbon removals portfolios that allow organisations to plot a path to genuine net zero. By carefully procuring projects from selected global suppliers across the spectrum of nature and technology, including high-quality afforestation, durable soil carbon, biochar, enhanced weathering and direct air capture, CUR8 is supporting new startups and methods that will make a difference to the climate crisis. CUR8 is on a mission to facilitate 1 billion tonnes of carbon removals annually by 2050. Notable clients that CUR8 have worked with so far include London Marathon Events, The O2 Arena, Levy UK, All Points East Festival and British Summer Time, as well as Royal events such as The Queen’s Platinum Jubilee Pageant and The Queen’s Funeral. Follow us onLinkedIn andTwitter.
About British Airways
British Airways recognises that flying comes at an environmental cost and acknowledges the need for urgent action to tackle the impact flying currently has on the planet. The airline was part of the first airline group to commit to achieving net zero carbon emissions by 2050. The airline is committed to achieving net zero carbon emissions through a series of short-, medium- and long-term initiatives. In the short-term this includes improving operational efficiency, introducing new fuel efficient aircraft, and progressively introducing sustainable aviation fuels using waste feedstocks, while in the medium to longer term this includes continuing to invest in the development and scale up of sustainable aviation fuel and looking at accelerating the growth of new technologies such as zero emissions hydrogen-powered aircraft and carbon capture technology. More details on British Airways’ sustainability programme, BA Better World can be found here. British Airways’ sustainability factsheet can be found here.
About Standard Chartered
Standard Chartered is a leading international banking group, with a presence in 53 of the world’s most dynamic markets and serving clients in a further 64. Our purpose is to drive commerce and prosperity through our unique diversity, and our heritage and values are expressed in our brand promise, here for good.
Standard Chartered PLC is listed on the London and Hong Kong Stock Exchanges.
For more stories and expert opinions, please visit Insights at sc.com. Follow Standard Chartered on Twitter, LinkedIn, Instagram and Facebook.
About UNDO
UNDO is a pioneering nature-based carbon dioxide removal company with an ambition to remove over one billion tonnes of atmospheric CO₂ in accessible, affordable, nature-friendly ways. For the last two years, UNDO has worked at the cutting edge of science alongside experts in the climate, carbon and agricultural sectors to develop an enhanced rock weathering process technology which mimics natural weathering processes to remove carbon from the atmosphere. The UNDO operational, scientific and technical model leverages existing by-products and infrastructure, with a carbon efficiency of 95 per cent, allowing UNDO to quickly scale existing operations whilst offering carbon removal services at cost-competitive prices. The company employs over 70 people in the UK and the US. In December 2022, it was approved by Puro.earth and is in the final stages of approval as conformant with ISO 14064 guidelines.
Notes to the editor:
UNDO is one of the most advanced and well-respected providers of carbon removals globally. Enhanced rock weathering is a scalable technology with significant co-benefits to soil health and crop yields. It accelerates the natural geological process of weathering, whereby the CO₂ in rainwater interacts with silicate rocks such as basalt, forming bicarbonate ions, which are transported to the ocean where it is stable over geological time. As this mineral-rich volcanic rock breaks down, it releases magnesium, calcium, potassium, phosphorus and other nutrients, increasing crop yield, raising and stabilising soil pH and ultimately reducing the need for fertilisers.
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Source: British Airways