- Twenty companies will purchase $53 million worth of carbon removal credits from Charm Industrial.
- The startup converts corn stalks and other plant waste into bio-oil and pumps it underground.
- Climate scientists argue that carbon removal is essential to keeping global warming below catastrophic levels.
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Not all oil is bad for the planet.
On Thursday, 20 companies announced plans to purchase $53 million worth of carbon removal credits from Charm Industrial, which converts corn stalks, leaves and other waste from agricultural crops into bio-oil. Charm then pumps the carbon-rich oil underground for permanent storage.
This is a way to prevent decomposition of organic matter and further warming of the atmosphere. The company estimates that oil will harden within days and carbon dioxide will be trapped for a million years.
The agreement, one of the largest to date involving the carbon removal industry, will prevent 112,000 tonnes of carbon dioxide from entering the atmosphere between 2024 and 2030. Charm Industry has removed 6,055 tons so far under a pilot program.
“This acquisition is very useful for raising capital, going out and building capacity,” co-founder and CEO Peter Reinhardt told an insider. “It’s hard to build capacity against something that isn’t in demand, so the signed contracts are very impactful.”
transaction Facilitated by Frontier, which was launched last year by Stripe, Alphabet, Shopify, Meta and McKinsey Sustainability with a $1 billion commitment aimed at revitalizing the carbon removal market.Frontier spent $5.6 million for carbon removal before Thursday’s deal with Charm Industrial.
Climate scientists say carbon removal is essential to avoid catastrophe. Even if countries cut their greenhouse gas emissions, it wouldn’t be fast enough to keep the planet from rising more than 1.5 degrees Celsius above pre-industrial levels.Achieving global climate change goals billions of tons would probably be needed We need to remove carbon dioxide from the atmosphere by 2050.
There are many different carbon removal techniques. Startups like Climbworks use fans to suck carbon dioxide out of the sky, while others are using enhanced weathering to accelerate the mineral’s natural ability to store carbon dioxide.
Meanwhile, Charm Industrial purchases agricultural waste from farmers and heats it to high temperatures in a device called a pyrolyzer. This process produces both bio-oil and bio-char.bio-oil is pumped to wells and salt caves It stores industrial waste or is left behind by oil and gas companies and is regulated by the Environmental Protection Agency.
“This is an opportunity to clean up these end-of-life oil and gas assets,” Reinhardt said. “These abandoned assets, which may be leaking oil or methane, can be salvaged and empty formations refilled and plugged or properly sealed.”
Farmers can add biochar to their fields, improving soil health and sequestering more carbon. But Charm Industrial doesn’t take that into account when measuring the amount of carbon it removes.of life cycle analysis This includes the total amount of carbon stored minus emissions from transportation, pyrolysis and underground injection.
Currently, Charm Industrial charges a fee of $600 per tonne of carbon removed, but Reinhardt said that could drop to less than $100 by 2040 as the company scales. said there is.
For the company to grow, it needs to utilize more of its agricultural waste, known as biomass. It is also used in renewable diesel and sustainable aviation fuel.
But Reinhardt isn’t worried about biomass shortages.
“You could say that this is a theoretical concern encountered in academia, but in practice it is far from reality,” he says. “Perhaps at very large scale, some questions will start to arise about how we compete for biomass. Now we hear biomass in our ears.”