2025 Q1 Durable CDR Market Update - Back at Basecamp

Highlights

• A quiet start to the year: Q1 2025 was the lowest-volume quarter since Q1 2023, with 462 thousand tonnes of durable CDR contracted.
• Concentrated demand: The top five deals made up 52% of total volume, with one new buyer entering the top five.
• Large contracts for emerging suppliers: Four of the top five transactions were the largest-ever deals for their respective suppliers. Each top deal represented a different CDR method.
• BiCRS delivers: Biomass-based methods accounted for 99% of delivered tonnes. Biochar remains the only method delivering at commercial scale.
• Geographic duality: Most top-10 deliverers were U.S.-based, yet the majority of delivered volume still came from Global South projects.

Preface

While this report covers market activity from January through March, we can’t overlook that the all-time durable CDR market volume nearly doubled in size in the first two weeks of April.

Microsoft announced two landmark purchases, 3.68 million tonnes from CO280 and 6.75 million tonnes from AtmosClear, a previously unknown company. Both are BECCS projects based in the United States. These are long-term offtake agreements, with delivery periods of over 10 and 15 years, respectively. As the facilities are not yet operational, delivery will not start for a few years, and some portion of the agreed-upon volumes will be delivered into the 2040s. With these deals, Microsoft’s share of all-time contracted durable CDR volume now stands at 77% of the 24 million tonnes recorded to date.

As a result, BECCS now accounts for over 75% of total contracted durable CDR volume. Retrofitting pulp and paper, or heat and power plants, with CO2 capture units is one of the easiest ways to remove hundreds of thousands of tonnes per year. It is also relatively cost-efficient compared to other methods (save biochar and biomass storage). BECCS on existing facilities is relatively low-hanging fruit for early, large-scale projects, but will not scale to gigatonnes. A portfolio of different CDR methods is required to meet those volumes.

Total contracted volume makes for strong headlines, but the most important indicator of the health and longevity of the CDR market is a growing, diversified buyer base, one that is purchasing across a wider range of methods, delivery models, and geographies.

Analysis

Q1 2025 was the lowest-volume quarter since Q1 2023. Following three consecutive million-tonne quarters, the year began with a slower pace: January and February each averaged around 60 kilotonnes before March lifted the quarterly total to over 460 kilotonnes. (Note that the quarter may have appeared much stronger than it was, as nearly 400 kilotonnes in purchases, contracted in Q4 2024, were announced in January but were already included in CDR.fyi’s 2024 Year in Review.)

On the positive side, the quarter saw the first-time entry of demand-side participants from various sectors, ranging from large institutional banks to small bike-sharing programs. These purchasers came to market with a distinct business case:

• Mitsu O.S.K Lines (MOL) framed CDR as a crucial step in their sustainability journey to support MOL’s 2050 net-zero target and a significant business opportunity in the rapidly growing carbon removal market.
• Nordea views removals as a strategy to mitigate the unabated emissions from its operations.
• LEGO is approaching its carbon removal partnerships as a way to build its understanding of new technologies and practices beyond its value chain.
• Mizuho Financial Group, having joined the NextGen CDR buying group, emphasized its early participation in carbon removal procurement as a means to acquire knowledge and expertise, ultimately positioning the company to capitalize on commercial opportunities in the Japanese market in the long term.

Of concern, Q1 2025 is the fourth consecutive quarter where we saw more Repeat buyers than New Buyers. The fact that repeat buyers tend to make larger purchases as they become more familiar with the market highlights the importance of attracting more first-time corporate buyers into the market, thereby laying the groundwork for future growth. Eventually, the early purchasers will have reached their net-zero ambitions, and they can no longer be relied upon to bear the entire burden of the market’s growth as their volumes decline to annual maintenance levels.

What will bring more first-time buyers to the market? The CDR.fyi and Sylvera 2025 Market Survey surfaced the importance of standards to purchasers. In March, the Science Based Targets initiative (SBTi) released a draft update to its Net-Zero Standard. Voices in the CDR sector reacted with disappointment as the draft called for companies to slowly start buying CDR to cover only their Scope 1 emissions. Although a requirement to buy durable CDR (still only one of several options in the consultation) would help build legitimacy for CDR and encourage more buyers to start, it would not drive significant demand, as most companies' CDR needs will be in Scope 3. The draft also included possible recognition from the SBTi for companies' efforts to fund climate outside of their value chains (BVCM). Although not exclusive to removals, it could help drive some additional demand.

Under the Biden Administration, the US was the powerhouse of CDR, with the most funding and the most advanced agenda. There is now deep uncertainty about what will happen next. There have been reports that funding for the two DAC hubs may be cut. At the same time, tariffs raise the costs of manufacturing plants. The 45Q tax credits for storing CO2 from BECCS and DACCS do not seem to be under immediate threat, though. Some are arguing that this presents an opportunity for other jurisdictions to step up and take the lead on CDR. Next-door neighbour Canada is at the top of the list, though its direction may hinge on the outcome of its April 28 federal election.

It is worth highlighting the role of intermediaries, such as Marketplaces and Brokers, in driving corporate adoption. They lay the groundwork for new corporate purchasers to enter the market by educating them on the need for and benefits of durable CDR in sustainability planning, and help guide them to the method and suppliers that will best suit the purchaser’s objectives. We have seen encouraging innovations as intermediaries evolve and adapt to stay competitive in a crowded market, including introducing service offerings beyond credit procurement such as offering new risk assessment frameworks and new rating models; offering more filtered portfolios for permanence, delivery status, and MRV strength; and securing long-term supplies and focusing on near-term deliveries to fulfill customers’ spot and future needs.

On the supply side, project development remained active across the pipeline, from partnerships and financing to pilot launches and operational expansions. Still, sustained progress will require more than momentum. As the industry scales, capital access, long-term offtake security, and policy clarity will be essential to keeping pace with growing demand expectations.

The quarter ended at basecamp, a pause in volume, not in momentum. Microsoft’s record-breaking purchases in the days after the end of the quarter redefined what’s possible for durable CDR. The climb ahead is clear, but if the sector is to scale the next phase of market growth, it will need broader buyer participation, clearer standards, and stronger delivery infrastructure.

Market Dynamics

Transaction Volume

2025 Q1 Results

Q1 2025 was a modest quarter, with 462 thousand tonnes of CDR contracted, down 15% (or 81 thousand tonnes) compared to Q1 2024 and 70% from the 1.6 million tonnes in Q4 2024. The quarter’s volume was driven by significant transactions involving veteran carbon removal demand-side actors, namely Frontier and Zurich Insurance, along with Mitsui O.S.K Lines purchasing outside of the NextGen CDR facility, and Nordea Bank as a first-time purchaser of CDR.

Top Transactions

The top five transactions of the quarter made up 52% of the quarter’s total. Frontier alone contributed to 27%, contracting 79 kilotonnes with Eion and 47 kilotonnes with Phlair; Nordea Bank, as a new entrant to the market, accounted for 15% of the quarterly volume with the purchase of 68 kilotonnes from Inherit. Mitsui O.S.K Lines purchased 30 kilotonnes (6.5%) from Captura and Zurich Insurance contracted 17.5 kilotonnes (3.8%) from Nellie Technologies.

Notably, each of the top five deals represented a different carbon removal method, underscoring the continued diversification of technologies gaining traction with corporate buyers.

Purchasers

Top Purchasers

While Frontier, the market’s largest buyers’ club, once again topped the leaderboard, a meaningful share of this quarter’s activity came from new entrants and established buyers with renewed commitment of varying deal sizes.

Frontier’s two large deals for removals via enhanced weathering with Eion, and DACCS with Phlair represented the group’s fourth-largest EW and second-largest DAC purchase to date. Nordic financial service group Nordea Bank entered the market with a 68-kilotonne purchase from Inherit’s BECCS project, becoming the second-largest durable CDR buyer in the banking sector.

Japan-based shipping company Mitsui O.S.K. Lines procured a total of 32 kilotonnes across three transactions: a deal with direct ocean removal startup Captura, and two biochar deals facilitated by South Pole with supplier Exomad Green. MOL also announced a strategic investment in Captura through its venture arm, MOL Switch.

Swiss insurance group Zurich Insurance’s purchase of CDR via biochar carbon removal was the second purchase since Q4 of 2022. Consulting firm Bain rounded out the top purchaser group, contracting 8 kilotonnes via Patch from three separate biochar suppliers.

Suppliers

Top Suppliers

The top three suppliers sold a combined total of 307,664 tonnes in Q1 2025, representing 65% of all contracted volume. Bolivian-based Exomad Green led the quarter with 158 kilotonnes sold, 130 kilotonnes of which went to marketplace buyer Supercritical.

US startup Eion’s 79-kilotonne deal with Frontier was the largest single transaction for the EW company and fourth largest in the methods category. Inherit Carbon Solutions’ 68-kilotonne contract with Nordea Bank marked the second sales for the Norwegian supplier capturing CO2 from a biogas plant in Denmark.

Phlair’s 47-kilotonne agreement with Frontier was its first large-scale deal and will be fulfilled by the company’s first commercial DAC facility in Canada. Prior to this, the German DACCS startup had sold a combined total of just 480 tonnes to five buyers.

Singapore-based biochar developer Arukah sold 32 kilotonnes to undisclosed buyers. U.S.-based Captura signed a 30,000-tonne agreement with Mitsui O.S.K. Lines — the largest contract to date for both the direct ocean removal startup and the method category. Nellie Technologies’ 17,500-tonne agreement with Zurich marked the first CDR deal for the Welsh startup. Mati also posted its largest deal to date, with a 5,000-tonne enhanced weathering agreement.

Deliveries

Top Deliverers

Q1 deliveries were once again led by familiar names in biochar, with additional contributions from other BiCRS methods and mineralization projects. Exomad Green accounted for 71% of all deliveries this quarter, ten times the volume of the next highest deliverer, Planboo, which sources from artisanal biochar projects globally. Other BiCRS startups, Graphyte and Vaulted Deep, accounted for 5% of the quarter’s delivered volume. O.C.O Technologies has the distinction of being the only non-BiCRS supplier in the top deliverers leaderboard, and also the only one from Europe. Notably, six of the top ten deliverers were US-based companies operating from US-based facilities, although they accounted for only 14% of total deliveries in aggregate.

Method Delivery Volumes

BiCRS projects dominated the delivery leaderboard in Q1. Biochar Carbon Removal and other BiCRS suppliers (including Vaulted Deep, Graphyte, and Charm Industrial) accounted for approximately 99% of total deliveries, totaling 38,830 tonnes. Other methods made up just 1% of deliveries (425 tonnes) this quarter, with contributions from mineralization (O.C.O Technology), DACCS (Climeworks), and enhanced weathering (InPlanet).

Investments

CDR Investment Landscape

In Q1 2025, 24 CDR companies raised over $137 million in private equity investments. Direct air capture companies in the United States and Germany accounted for the majority, raising $76 million (55%), with Spiritus and Capture6 together bringing in $57.5 million through Series A rounds.

BiCRS startups raised $46 million overall, including $9 million across five biochar companies. Carbon mineralization firms Arca Climate and 44.01 secured a combined $13 million, while marine CDR startup BlueShift closed a $2 million seed round.

Notably, Heirloom received an undisclosed investment from United Airlines’ corporate venture arm, following its $150 million Series B raise last year. Mitsui O.S.K. Lines, which had participated in that Series B, also announced a new investment in direct ocean removal startup Captura through its venture arm, MOL Switch, marking Captura as the second CDR company in MOL’s portfolio.

Notes on the Data

• Data Sources: All of the data used in preparing this report is based on reported transactions, including public announcements, direct submissions by suppliers and purchasers through the CDR.fyi Portal, and integrations with ecosystem service providers. See Methodology for additional details on our approach. To provide feedback on the CDR.fyi data model, reach out to us at partners@cdr.fyi.
• New CDR.fyi Data Model: We recently implemented enhancements to our data model and integrations with ecosystem partners. These enhancements were designed to increase the consistency of information across partners, improve clarity around deliveries, and increase transparency. Please contact us at team@cdr.fyi if you would like to be a reviewer for future data model enhancements.

CDR.fyi tracks carbon removal purchases & deliveries with a permanence of hundreds to thousands of years. For any corrections or questions, contact team@cdr.fyi. For data licensing & partnership inquiries, contact partnerships@cdr.fyi.

Acknowledgments

Thank you for exploring the CDR.fyi 2025 Q1 Durable CDR Market Update report.

This blog post is an abridged version of the comprehensive edition exclusive to our Data Partners and Platform Subscribers. For access to the full report or further information, kindly contact us at partners@cdr.fyi.

Data, analysis, and content for the CDR.fyi 2025 Q1 Durable CDR Market Update was provided by Tank Chen, Nadine Walsh, Robert Höglund, Katya Larina, Ifeoluwa Daranijo, Alex Rink, and Roden Sherpa.

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