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Coming compliance markets │ What goes up must come down, Episode 11
In this episode of What Goes Up Must Come Down, Simon is joined by Marian Krüger, founder of Remove, a nonprofit supporting carbon removal startups worldwide. Together, they explore the motivations behind why companies buy carbon removal credits and how compliance will shape the sector’s future.
TL;DR
- Companies are increasingly buying carbon removal credits as part of their sustainability goals and long-term strategies.
- The carbon removal market is still maturing, with demand not yet meeting expectations, but the gap is shrinking.
- Compliance frameworks like the EU ETS are seen as key drivers for future market stability, but introducing them too soon could limit innovation.
- Companies are exploring both portfolio-based strategies and single-project investments, each with its own risks and benefits.
- Innovation and compliance must work together to ensure emerging technologies can scale without being stifled by price-driven markets.
Writing the book “Race to Zero”
Marian Krüger and co-author Benedict Probst from the Max Planck Institute wrote Race to Zero to fill a gap in the carbon removal space. “We realised there wasn’t an accessible resource for professionals who need to understand carbon removal without delving into highly technical content,” says Marian.
The book is designed to make carbon removal more understandable for corporate sustainability professionals tasked with integrating it into their strategies. “We wanted to provide a clear starting point for managers to learn about carbon removal technologies and their role in a net-zero strategy,” he adds.
Why and how companies buy CDR
Companies buy carbon removal credits for various reasons. Some are driven by CSR goals or to enhance their brand. Others, particularly larger corporations, see it as a long-term investment in technologies that will shape their future operations.
“We’re seeing a shift towards more strategic purchases,” Marian explains. “It’s not just about ticking boxes. Companies are aligning their carbon removal investments with their core business or securing future technologies.”
However, despite growing interest, Marian acknowledges that demand has not yet reached expectations. “The gap between supply and demand is shrinking, but we’re not there yet. The market is still maturing,” Marian notes.
The growing role of compliance in carbon removal
As the carbon removal sector matures, many are looking to compliance systems like the EU Emissions Trading System (ETS) to drive demand. However, there are risks if these frameworks arrive too soon.
“If compliance comes too quickly, we risk focusing on the cheapest solutions and excluding technologies that need more time to scale,” Marian cautions. “We must avoid stifling emerging solutions.”
While compliance could bring stability, Marian stresses the need for balance. “If it becomes too rigid, it could squeeze out technologies like biochar, DAC, and enhanced rock weathering, which need time to mature.”
He believes that a more flexible approach to compliance would allow innovation to flourish. “Compliance is essential, but it must work hand in hand with innovation,” he says.
Navigating carbon removal portfolios
Companies are building carbon removal portfolios, spreading their investments across different technologies. But, as Marian points out, there are challenges with this approach.
“Diversification helps spread risk, but it can also mean that no single technology gets enough funding to scale quickly,” he says. Companies like Airbus have opted to buy into single projects to help specific technologies get off the ground. But this approach has its own risks.
While diversifying portfolios makes carbon removal more affordable, companies must ensure they’re not spreading their investments too thin. The key, especially for smaller companies, is finding the right balance of technologies to support, while navigating a market that’s still in its infancy.
Conclusion
As the carbon removal market evolves, businesses must adapt. While compliance frameworks will likely help stabilise the sector, it’s crucial to ensure they don’t stifle innovation.
For companies looking to invest in carbon removal, it’s crucial to balance short-term cost considerations with long-term innovation. By strategically supporting a range of carbon removal technologies, businesses can help scale effective solutions that will be key to meeting global climate goals.
CDR and Systems Thinking | What Goes Up Must Come Down, Episode 10
In this episode, Simon Bager, Co-Founder and COO at Klimate, speaks with Noah McQueen, Director of Science and Innovation at Carbon180, about CDR in a systems thinking perspective, geopolitical uncertainties, and resilience systems.
TL;DR
- Carbon removal is a "system of systems"—technology, policy, finance, and communities must work together for real impact.
- Success depends on building resilient, adaptable, and transparent ecosystems, not just technological breakthroughs.
- The Nordic region shows that even advanced systems can stall without community engagement.
- Scaling carbon removal now requires strategic, disciplined investment and a focus on proven solutions.
- Resilient carbon removal systems are diverse, locally adapted, redundant, and supported by evolving policy.
- Progress is measured by transparency, collaboration, infrastructure consolidation, and community integration.
- The sector’s collaborative culture and scientific rigor are its greatest strengths.
- Achieving gigaton-scale impact means shifting from rapid growth to building durable, honest, and adaptable infrastructure.
Systems thinking in a CDR perspective
Carbon removal operates within an interconnected web of systems—energy, materials, finance, policy, and community engagement. It’s not just about technology; it’s about ensuring that all supporting systems evolve together to scale effectively. Essential components include policy frameworks, financial infrastructure, public education, and robust monitoring standards. In the Nordic region, while technological and policy infrastructure is strong, the lack of public understanding and support has hindered progress. This highlights how even well-developed systems can stall if one element fails to keep pace.
Geopolitical uncertainties in capital markets and scaling CDR
The landscape for carbon removal has shifted, with the easy access to capital coming to an end. As interest rates rise and venture capital becomes more selective, carbon removal companies face a critical financing gap. Drawing lessons from the wind power sector, carbon removal must prioritise proven technologies that can demonstrate near-term success, maintain research pipelines, and focus on delivering on contracts. This strategic approach to capital allocation will be key in scaling infrastructure while managing rising costs and investor uncertainty.
Resilience systems and high accountability
Building resilient carbon removal systems requires diversity, redundancy, and adaptability. A robust portfolio should incorporate various methods, tailored to specific geographical contexts, with redundant infrastructure to ensure reliability. Policy frameworks must evolve with new evidence and provide long-term certainty for investors. Key indicators of resilience include increased transparency, stronger cross-sector collaboration, infrastructure consolidation, and community integration. These principles will be crucial for scaling carbon removal systems in a way that can adapt to changing conditions and meet long-term climate goals.
Conclusion
Carbon removal’s success depends on optimising the entire system—not just individual technologies. As the sector matures, the focus must shift from rapid scaling to building durable, resilient infrastructure capable of delivering gigaton-scale impact over decades.
This requires honest assessment of system weaknesses, strategic resource allocation, and continued collaboration across all stakeholders. The technical challenges are solvable—the real work lies in aligning the human systems that will determine whether carbon removal fulfils its critical role in addressing climate change.
The path forward demands both optimism and realism: optimism about the sector’s potential and the dedication of its participants, and realism about the complex, interconnected challenges that must be addressed to achieve lasting success.
If your organisation is ready to take meaningful climate action, consider Klimate as your partner in navigating the complexities of carbon removal.
Wrapping up COP30: Key takeaways and what’s next for global climate action
Fossil fuel phase-out – or not?
As negotiations continue into the weekend, delegates are working toward a resolution on major issues: funding for adaptation, accountability on climate finance, and addressing the root causes of the climate crisis—fossil fuels and deforestation. These must be handled in a just manner that doesn’t exacerbate debt.
Right now, a roadmap to phase down fossil fuels appears to be off the table, as it’s been left out of the updated leaked text. For many large fossil producers and consumers, any mention of a phaseout is a dealbreaker. However, for at least 29 countries, this issue may be non-negotiable.
Earlier this week, I wrote: if delegates aren't willing to consider eventual decarbonisation, what’s the point? Fossil fuels are undeniably one of the primary causes of rising CO2 emissions, and there is no quick fix for total decarbonisation (something I’ve learned over nearly three years in the carbon removal field).
Up next: Ministers agree on a final resolution
The agenda at COP30 has shifted as negotiations have advanced in some areas and stalled in others. The main objective for delegates remains to agree (and compromise) on a resolution for next year’s climate action. There were many issues on the table this year, with notable participation from civil society, but has COP30 lived up to being the ‘implementation COP’? I’m not so sure.
Here were the four interconnected issues outlined at the start:
- Financial Aid: Delivering $300 billion per year in climate finance
- Climate Plan Ambition: Whether countries should strengthen their climate commitments
- Trade Barriers: Addressing climate-related trade restrictions
- Transparency: Improving reporting on climate progress
The Belém presidency has been pushing a science-aligned and people-centred agenda. Well put by Marcio Astrini, this presidency has worked hard to shape negotiations on “fossils, forests, finance: three core areas of climate change, delivered under a framework based on justice and poverty alleviation.”
Carbon markets & Article 6 are still on the table
Alongside mitigation ambition and cooperation between countries, discussions around Article 6 of the Paris Agreement continue.
What is Article 6? It’s a framework for countries to cooperate voluntarily to achieve their Nationally Determined Contributions (NDCs) and increase climate ambition (described really well in this post). The next rules of play are being outlined, including how countries and even the private sector can contribute to mitigation outcomes.
For carbon markets, this could mean a new way of operating with a direct link between high-integrity credits and Paris Agreement goals. However, the key issue remains integrity—governance, transparency, and permanence are still being worked out. Follow Simon Pfluger for updates there.
Outside of Article 6, carbon dioxide removal (CDR) is an important element of national climate roadmaps, adaptation measures, and even just transition, if implemented intentionally. This was a historic stage for carbon removal in particular, in part thanks to efforts from CDR30: The Global CDR Initiative at COP30. They brought awesome insights on CDR in practice, the role of governments in spurring demand, and the synergy of CDR and other major thematic items, from justice to finance to private sector.
If we move forward with a UN 'Paris-aligned' market, the need for rigorous, independent due diligence on all crediting mechanisms has never been clearer. Without it, we risk eroding the trust in carbon markets as a whole.
Maybe not the COP we wanted, but it's the COP we got
Regardless of where negotiations end up by Sunday, COP isn’t the only climate conference. There are already upcoming G7 and G20 meetings, where President Lula has promised to bring the fossil-fuel phaseout debate to the table.
What can we actually expect from COP? On the one hand, we can and should ask for more from representative governments especially as public concern over climate change is at an all time high. Ultimately, COP is an exercise in global environmental governance, but it’s not, and realistically never will be, the primary stage for climate progress.