UK-headed renewable energy major Drax Group plc (Drax) has agreed a Memorandum of Understanding (MoU) with C-Zero Markets (C-Zero) in relation to the sale of carbon dioxide removal (CDR) credits from Drax’s first US bioenergy with carbon capture and storage (BECCS) facility.
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In February 2023, the UK-headed carbon offsets service provider C-Zero revealed that it had “reacted quickly to market opportunities” for its clients in securing 2 000 tonnes of carbon capture credits in a ground-breaking partnership with Drax.
Carbon dioxide removals (CDRs) are used by organizations to balance their hard-to-abate carbon emissions, achieve a net zero, and, in some cases, a carbon-negative status.
Longer-lasting and lower-risk carbon credits, such as the types generated by carbon removals technologies, are increasing in demand as more organizations look to hit their decarbonization targets.
Drax aims to be a global leader in BECCS – delivering renewable energy and carbon removals while becoming a major player in this potentially trillion-dollar market, said Marc Bradbrook, Director of Business Development of Drax.
US$300 per tonne
Under the terms of the agreed MoU, Drax, and C-Zero will work together with a view to C-Zero acquiring 2 000 tonnes of CDRs for US$300 per tonne.
I’m thrilled that the partnership with Drax will help solve the other half of the climate equation with carbon removal. This will be a crucial development in the market for our clients and us; we are already receiving huge interest. This market will evolve quickly, and being involved from the start is a game changer for us and, more importantly, our clients, said Mike Ridler, Director of C-Zero Markets.
With the right government engagement, Drax plans to invest billions over the coming years in global carbon removals and renewable energy projects, with the aim of capturing 12 million tonnes a year of carbon removals by 2030 globally and being a global leader in carbon removal projects.
While the CDR market is still in the early stages, the clear demand that we are seeing for removals alongside the progressive policies being developed in the US to support BECCS is enabling the investment needed to spur this vital new sector of the economy. We hope this deal with C-Zero will demonstrate the continued growth of the sector and spur other companies to invest now to support the development of this vital market, Marc Bradbrook said.
In 2022, Drax announced a deal with Respira, which could see the largest volume of carbon dioxide removals traded so far, a landmark moment for Drax, the development of a global carbon market, and the fight against climate change.
