Shopify, Stripe, Alphabet and Others Pledge Nearly $1 Billion on Carbon Removal
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Shopify, Alphabet, Meta Platforms Inc., and McKinsey & Co. have all pledged to join Stripe’s Frontier fund, a public-benefit corporation, in a $925 million carbon offset buying effort and the largest combined financial commitment in the world aimed solely at carbon removal.
On the heels of the IPCC’s third installment of its Sixth Assessment Report, which called for increased efforts to reduce emissions, the Frontier fund says it will support carbon removal efforts by helping companies in the space scale up and reduce operating costs to increase atmospheric CO2 removal.
The Frontier Fund
“Shopify’s stance on climate change has been loud and clear since introducing our Sustainability Fund in 2019: we need to fight this together,” Shopify’s Head of Sustainability Stacy Kauk said in a post accompanying the announcement. “Reducing emissions is an important component of combating climate change, but even if we stopped all emissions right now, there’s still too much carbon in our atmosphere. We must start working on these climate-saving technologies to protect our future.”
The Frontier fund is modeled after efforts launched a decade ago to speed the development of pneumococcal vaccines for developing countries. The fund says its the first to adopt this same technique to carbon removal. The vaccine efforts saved an estimated 700,000 lives, the fund says.
Carbon capture efforts have great potential but have been underutilized, according to the Fund. As of 2021, fewer than 10,000 tons of CO2 have been removed from the atmosphere and it says that’s one million times short of the necessary annual removal.
“And, recent reports from the Intergovernmental Panel on Climate Change make it clear that there is currently no pathway to keeping global temperature increases within 1.5℃ without aggressively pursuing emissions reductions and permanently removing gigatons of carbon dioxide already present in the atmosphere and ocean,” Kauk says.
The Fund will help early-stage carbon removal suppliers pilot new technologies, and for growth-stage suppliers in the space, it will help increase purchases of future removal so the companies can “scale their solutions and remove more carbon dioxide from the atmosphere,” Kauk says. “When tonnes of CO2 are removed, the carbon removal companies get paid and removal tonnes (or units) are issued back to buyers.”
Specific criteria for accelerating the technologies include reducing costs to under $100 per ton, permanent storage—1,000 years or more—as well as capacity, and supporting meaningful environmental justice outcomes, the fund says.
“This AMC is Shopify’s next big move in our fight to reverse climate change,” Kauk says.
“We are thrilled about the possibilities that Frontier will bring to the carbon removal market. Our mission here is to remove friction and enable other companies to easily buy carbon removal, to set high-quality standards, and take a leading role in scaling carbon removal companies selected by Frontier.”