Under the 2021 Net-Zero Emissions Accountability Act, Ottawa must publish targets for 2035 by December 1, and Environment Minister Steven Guilbeault has confirmed that the government will release the proposed targets on schedule. Signatory nations of the Paris Agreement, including Canada, are also expected to announce their 2035 targets at next month’s Conference of the Parties (COP) meeting in Baku, Azerbaijan.

The Net-Zero Advisory Body (NZAB) – a group appointed by Guilbeault to help the government find a credible path to net-zero – is proposing that Ottawa set a 2035 target to reduce greenhouse gas emissions by between 50% and 55% below 2005 levels, a 10% increase from the current federal target for 2030. Under the Paris climate agreement, countries are expected to ratchet up their targets every five years.

Armed with analysis from the Canadian Climate Institute, NZAB says its proposed reductions are both feasible and affordable. While Canada has made “significant progress” on climate action since signing the Paris treaty in 2015, NZAB co-chair Simon Donner writes in the report, “more aggressive and sustained action is necessary to reach our 2030 emissions targets and to shift to a long-term net-zero pathway.”

The government acknowledges the need for more action to achieve its 2030 goals, let alone to meet its pledge to be carbon-neutral by 2050. However, provinces are balking at tougher measures, and Conservative leader Pierre Poilievre is preparing to fight the next election – expected within the year – on killing the Liberals’ carbon tax.

NZAB also recommends that the federal government establish a maximum cumulative emissions level for the period between now and 2050. This “carbon budget” approach would reflect the country’s ongoing progress better than annual targets, it says. 

The advisory body also notes that the targets and budget are net figures. While emission reductions must be the primary focus, Canada can also rely on “negative” emission approaches, including nature-based solutions and purchasing credits from other nations.

The battle over what counts as realistic reduction targets

Some energy analysts question NZAB’s confidence in the feasibility and affordability of its proposed 2035 targets, given the hurdles to implementing the fundamental economic changes that are needed to meet the targets: lack of clear and consistent government policy, lack of capital and a skilled workforce, supply chain challenges in building a clean energy infrastructure, and the political price of adding short-term costs to consumers.

“It’s becoming increasingly clear that there’s a big and growing disconnect between the pace of emissions reductions dictated by climate science and the pace of emissions reductions that’s possible when you look through the lens of social sciences,” says Monica Gattinger, director of the Positive Energy program at the University of Ottawa.

Canada’s ability to reduce emissions is limited by how well it can address the connected implementation challenges, Gattinger says. 

“The target needs to be ambitious, but we need to understand how we get there,” says Guilbeault. “I am not a big fan of setting targets where we have no idea how to get there. I think it is counterproductive and discourages people.”

Climate Action Network (CAN), an umbrella group of civil society organizations, argues that the government should aim for a 60% reduction from 2019 levels. The more ambitious target represents a fairer share of Canada’s contribution to the problem as a large emitter, says CAN executive director Caroline Brouillette, speaking in a phone interview. “If Canada doesn’t do its fair share in the global effort to keep us at 1.5 degree, who is going to?” she asks.

But setting more ambitious targets would escalate the political fight that is expected to take centre stage in the next election.

Provincial governments in Alberta and Saskatchewan have been waging a war against Ottawa’s proposed emissions cap for the oil and gas industry, which was promised in the 2021 election by the Liberals but has yet to be finalized.

Premier Danielle Smith’s United Conservative Party (UCP) in Alberta has launched a national advertising campaign denouncing the emissions cap as a de facto limit on production, which the Liberals deny. In 2023, the UCP laid out a climate plan that claims to set “realistic aspirations” of achieving carbon neutrality by 2050. However, Smith’s government has not set any pathway with targets to keep them on track and has virtually shut down new construction in the renewable-power sector. 

“A sober assessment is that Alberta is not serious about any meaningful reductions in GHG emissions,” says Martin Olszynski, an environmental law professor at the University of Calgary.

At the UCP convention in November, members will vote on whether carbon dioxide should be considered a pollutant or the “foundational nutrient for all life on Earth.”  

The Supreme Court of Canada upheld the federal carbon levy in 2021. The majority ruled that “climate change is real” and that “it is caused by greenhouse gas emissions resulting from human activities and it poses a grave threat to humanity’s future.”

Ontario is also offside with the federal approach, notably Ottawa’s planned net-zero electricity regulations, which would require provincial grids to be carbon-neutral by 2035. The province’s Independent Electricity System Operator has recommended that the province plan for continued use of natural gas for power in order to keep prices down as renewables and nuclear ramp up.

Ontario’s Progressive Conservatives under Premier Doug Ford jettisoned the more ambitious GHG targets set by the previous Liberal government and aim to reduce emissions by 30% below 2005 levels by 2030 – Canada’s original Paris commitment. The Trudeau government, along with other countries, subsequently increased its ambition for 2030, as required by the Paris Agreement.

A spokesman for Environment Minister Andrea Khanjin said that Ontario is focused on its 2030 target and has introduced climate initiatives such as electrification of energy-intensive industrial plants, a clean energy grid and support for the electric vehicle industry.

In October, Ontario lost an appeal of a lawsuit brought by seven young plaintiffs, who argue the province has violated their Charter rights by weakening the climate target and thereby causing harm to  youth and future generations. 

Ontario’s Superior Court reinstated the case after a lower court judge rejected it, and it now must go to trial.

Correction: An earlier version of this article misattributed the recommendation for Ontario to continue using natural gas.

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The 120 million tonnes of emissions from fossil fuels, plus another 10 megatonnes from traditional uses of biomass, leave countries with a lot of work to do in very little time if they aim to drastically reduce their methane pollution by 2030. That’s after 50 of the world’s biggest fossil producers, including 29 oil and gas companies, pledged to essentially phase out methane emissions and end routine gas flaring by decade’s end in the early days of the COP28 climate summit in December.

“A 75% cut in methane emissions from fossil fuels by 2030 is imperative to stop the planet from warming to a dangerous level,” IEA executive director Fatih Birol said in a release.

The report says that new national pledges on methane would reduce emissions by about 50%. “However, in most cases, these pledges are not yet backed up by detailed plans, policies, and regulations.”

Methane is a shorter-lived greenhouse gas than carbon dioxide, but it carries about 84 times more warming potential over the crucial 20-year span when humanity will be scrambling to get climate change under control. The IEA says methane is responsible for about 30% of the rise in global temperatures since the beginning of the Industrial Revolution, and the top 10 polluters – all of them major oil and gas producers – accounted for 80 million tonnes in 2023, or two-thirds of the global total.

The biggest emitters were:

• United States, 13.3 megatonnes

• Russia, 11.2 Mt

• Iran, 6.0 Mt

• Turkmenistan, 5.2 Mt

• Venezuela, 3.0 Mt

• China, 3.0 Mt, with less than one-sixth the emissions intensity of Venezuela

• Algeria, 2.8 Mt

• Saudi Arabia, 2.4 Mt

• Canada, 2.4 Mt, with slightly higher emissions intensity than Saudi Arabia

• Iraq, 2.3 Mt

• Norway, which is listed on the IEA chart but with no emissions data

Oil was the biggest source of methane emissions in 2023, at 52 megatonnes, followed by gas at 27 megatonnes and coal at 37.

The IEA says that countries’ commitments on methane in 2023 put them in a position to begin reducing emissions soon, although those promises still fall short of what’s needed to hold average global warming to the Paris Agreement target of 1.5°C.

“I am encouraged by the momentum we’ve seen in recent months, which our analysis shows could make an enormous and immediate difference in the world’s fight against climate change,” Birol said in the release. “Now, we must focus on transforming commitments into action – while continuing to aim higher,” with “well-known policies and existing technologies” on tap to “reduce methane emissions from fossil fuels substantially.”

That means the coming years could bring considerable progress or far less.

“On one hand, more governments and fossil fuel companies have committed to take action on methane,” the IEA writes. “Global efforts to report emissions estimates consistently and transparently are strengthening, and studies suggest emissions are falling in some regions.”

However, “overall emissions remain far too high to meet the world’s climate goals,” the Paris-based agency warns. “Large methane emissions events detected by satellites also rose by more than 50% in 2023 compared with 2022, with more than 5 Mt of methane emissions detected from major fossil fuel leaks around the world – including a major well blowout in Kazakhstan that went on for more than 200 days.”

This story first appeared in The Energy Mix. Read the original article here.

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Yet if we achieve these dramatic reductions, it won’t necessarily mean that every company has reduced its methane emissions by 75%. Some companies are likely to perform better than others. The need to distinguish leaders from stragglers means accurate and transparent emissions reporting is essential.

With climate disclosure rules from Canadian Securities Administrators expected in the first half of 2024, there is hope for improved corporate transparency and accountability on environmental, social and governance (ESG) standards. But a gaping loophole in the proposed standard will mean that investors won’t get accurate information about Canadian oil and gas companies’ emissions, particularly when it comes to methane.

Barriers to informed investing

Since reducing methane emissions is a quick and cost-effective way to curb emissions and mitigate warming, investors will want companies to move especially fast on this potent GHG. Right now, if you want to base investment decisions on methane performance, the information you need is strewn across various sources, including the federal government’s Greenhouse Gas Reporting Program, Petrinex, provincial reporting programs such as Alberta’s OneStop, and producer websites. Some of that data is publicly accessible and some not. What is accessible is sometimes contradictory, often incomparable and consistently inaccurate.

It shouldn’t be this hard for investors to find the facts.

An end to the “Wild West”

The International Sustainability Standards Board’s (ISSB) reporting standards are designed to establish a “global baseline” for sustainability reporting and require that companies disclose climate-related governance, strategy, risk management, and metrics and targets. They should help end what has been described as the “Wild West” of sustainability reporting, where voluntary reporting enables companies to “cherry-pick” favourable ESG frameworks from more than 600 choices. Greater standardization will make the information available to investors more consistent, comparable and meaningful.

While the ISSB rules establish a baseline for international reporting requirements, it is up to national regulators – like Canada’s CSA – to determine legally binding requirements in their jurisdictions. The CSA’s proposed National Instrument 51-107 – Disclosure of Climate-Related Matters sets forth the rules for disclosure that will apply to all publicly traded Canadian companies.

Out of step with global standards

While a growing number of companies are disclosing environmental data, the majority still don’t, including 1,600 of the most environmentally harmful companies in the world, such as ExxonMobil, Chevron and Glencore. A study by researchers at St. Francis Xavier University found that, of 70 Canadian oil and gas producers surveyed, only 49% had sustainability reports or ESG indicators posted on their websites – and only 32% reported methane intensity.

The proposed CSA rules don’t actually get rid of voluntary reporting – at least not where it counts. They require publicly traded oil and gas companies to disclose Scope 1 (direct), Scope 2 (indirect, from energy purchased for production) and Scope 3 (indirect, from downstream consumption) emissions . . . unless they choose not to.

The proposed rules include a permissive opt-out clause, which allows companies not to report, so long as they provide a reason. The text does not require that the reason be legitimate or define “legitimate reason.” Moreover, the text recognizes that this flexibility renders the GHG reporting requirement “not mandatory.” The choice to opt out of reporting takes the Canadian rules, in the words of one legal expert, “wildly out of step” with U.S. and international requirements.

The CSA indicates that it is consulting on an “alternative” rule that would require Scope 1 reporting while keeping the “report or explain” requirement for Scope 2 and 3 emissions. This would be preferable for the purposes of corporate transparency and accountability – but even still, large emitters should not be able to opt out of any aspect of emissions reporting.

Accuracy

Then there’s the thorny issue of inaccurate methane quantification. The official federal inventory and ESG metrics alike are based on estimation and self-reporting, which are known to under-represent emissions. The StFX study shows that modelling methane intensity based on field data results in an intensity rate that is more than twice that of the official methane inventory.

The new Canadian disclosure rules do nothing to address the underestimation problem. They specify that companies that choose to report should follow the GHG Protocol (or a comparable method), which involves status quo accounting using emissions factors, with no integration of measurement and verification.

Stronger requirements needed

Canadian investors deserve clear, accessible, comprehensive and accurate data regarding oil and gas methane and other GHG emissions. In Canada, that can become a reality only if:

1. The CSA aligns with international standards by eliminating the permissive opt-out clause for emissions of all scopes.
2. Oil and gas companies are required to adhere to international best practices for measurement, monitoring, reporting and verification, such as the Oil and Gas Methane Partnership 2.0 backed by credible and transparent measurement standards, such as GTI Veritas or MiQ.

Lax emission-reporting standards mean Canadians don’t have the information they need to judge companies’ environmental performance, make informed investment decisions and hold heavy emitters accountable.

Amanda Bryant is a policy analyst working to advocate for strong regulations to effectively reduce methane emissions from oil and gas activity.

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Between 1990 and 2021, GHGs from the transport sector in Canada soared 27%. And yet, Canadian delegates at COP28 in Dubai this week have arrived without final regulations for transitioning cars and other light-duty vehicles from fossil fuel power to clean energy. Draft regulations applicable to heavy-duty trucks and buses – where emission levels have climbed rapidly, threatening to surpass those of cars – have not been released.

Should Canada fall short of transitioning to zero-emission vehicles at the pace needed, we will fail to reduce national emissions by 40% to 45% below 2005 levels by 2030. Worse, it will be impossible to accomplish Canada’s global commitment to carbon neutrality by 2050. It cannot be overstated how much is at stake.

Last December, the federal government issued draft regulations intended to increase sales of EVs across the country. The regulations follow the pledge in the government’s 2030 Emissions Reduction Plan that by 2035 all sales of new light-duty vehicles in Canada should be electric models that do not emit carbon pollution.

The draft regulations stipulate that increases in sales of emission-free cars be phased in. By 2026, for instance, 20% of total vehicle sales by a manufacturer or importer should be electric. By 2030, zero-emission vehicles must make up 60% of total sales. Five years later, the consumer will be able to choose from a range of model options, all of which will be fuelled by clean energy. Air pollution levels will plummet.

As demonstrated in both British Columbia and Quebec, sales mandates – which both provinces have implemented – are an effective means of switching from gas to electric cars.

A province-wide sales requirement for EVs was introduced in B.C. in 2019; the goal was that, by 2040, 100% of vehicles sold would be zero-emission. In 2022, EVs accounted for 18.1% of all new light-duty vehicle sales in B.C. Just prior to the legislation, EVs made up 4.1% of all new passenger car sales. Because the original sales targets will likely be exceeded, the provincial government has moved the goal posts: with the new target, 100% of cars sold will be electric models by 2035, five years ahead of schedule.

Like B.C., Quebec also passed regulated targets for the number of new-car sales that are zero emission. From 8.9% of new cars sold in 2021, EVs now constitute 13.9% of the light-duty vehicle market in Quebec.

We’ve seen a significant rise in EV sales across the country despite insufficient inventory on most dealer lots. According to data released by S&P Global Mobility, registrations for zero-emission vehicles reached 13.3% in Canada in the third quarter of 2023 – one in eight new vehicles registered were electric, an increase of 2.7% from the second quarter of 2023, with a market share of 10.5%.

A new report from RBC Capital Markets predicts that the EV market is on the verge of substantial growth, as prices stabilize and charging infrastructure expands. These numbers tell us that the growth in the EV market, which has surpassed expectations again and again, is not an instance of early adopters testing a new gadget. It’s a smart consumer choice when you consider that in almost every instance an EV is cheaper than a gas car over the lifetime of the vehicle.

But the transition to clean transportation must move much more quickly if there’s any hope of meeting, or coming close to meeting, Canada’s climate commitments. To suggest, as some stakeholders have, that Canada not stick with a sales mandate, so clearly a winning formula, makes no sense.

Undoubtedly, there is much else that the federal and provincial governments need to do, starting with more rapid deployment of adequate and reliable charging infrastructure, more provincial consumer incentives, and an upskilled labour force. Still, if Canada succeeds in replacing gas-fuelled cars with electric ones at the scale called for in the government’s Emissions Reduction Plan, GHGs from transportation would drop by 42% to 46% below 2005 levels, in line with Canada’s climate commitment. While this may be a hopeful outcome, it certainly isn’t an empty one.

Adam Thorn is director of transportation at the Pembina Institute.

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The new regulation, which broadly aligns with a similar effort in the United States, will eliminate the equivalent of 217 million tonnes of carbon dioxide pollution between 2027 and 2040 and deliver C$12.4 billion in “avoided global damages”, Environment and Climate Change Canada (ECCC) said in a release. It’s meant to eliminate routine venting and flaring of natural gas, improve methane leak detection and repair, and address the risk of large methane releases.

“We’re seeing here the beginning of a global movement toward almost eliminating methane emissions from the oil and gas sector,” Environment and Climate Change Minister Steven Guilbeault told reporters in Dubai.

“As the world’s fourth largest oil and gas producer, we have both the responsibility and the know-how to do everything we can,” he added in the departmental release. “At this time of robust profit margins and high [fossil] energy prices, there has never been a better time for the oil and gas sector to invest in slashing methane emissions.”

“Great to see Canada taking strong action to achieve deep reductions in oil and gas methane emissions, just as the U.S. finalizes our own regulations,” said U.S. climate envoy John Kerry. “This is an essential strategy to limit warming to 1.5°C.”

Methane is a climate super-pollutant with 80 to 85 times the warming potential of carbon dioxide over the crucial 20-year span when humanity will be scrambling to get climate change under control. Earlier this year, the Intergovernmental Panel on Climate Change identified fossil industry methane controls, alongside solar, wind, and energy efficiency deployment, as one of the cheapest ways to deliver faster, deeper emission cuts in this decade.

After signing on to the Global Methane Pledge two years ago during the COP26 meeting in Glasgow, Canada released a methane reduction strategy in September, 2022 that affirmed the 75% reduction from 2012 levels by decade’s end, Guilbeault’s department recalled in a backgrounder published earlier today. ECCC followed with a draft regulation two months later, then updated the draft in September, 2023.

The government is also moving to improve methane monitoring and support provincial action on methane through equivalency agreements with Alberta, British Columbia, and Saskatchewan, the backgrounder stated. And Ottawa earmarked $30 million for a new Methane Centre of Excellence to “improve our understanding and reporting of methane emissions, with a focus on collaborative initiatives to support data and measurement.”

Fossil fuel companies are also moving to get their methane emissions under control, ECCC said in its media release. Earlier in the COP, 50 of the world’s biggest oil and gas companies—none of them Canadian—announced voluntary commitments to reduce their methane emissions 80 to 90% by 2030.

But “voluntary action will never be sufficient,” Stephane Hallegatte Sr., a climate change advisor at the World Bank, told CBC. “Regulations are really, really important. You have to ask all oil and gas companies to check for those leaks. There are great new technologies to monitor leaks in real time and to act on them.”

Climate policy and campaign organizations attending COP28 applauded the federal announcement and urged Ottawa to get on with the job of finalizing the new regulations.

“The best way to fully eliminate methane pollution is by phasing out fossil fuel production,” Climate Action Network-Canada said in a release. “As momentum grows at COP28 towards a full, fair, and funded fossil fuel phaseout, Canada must use every tool at its disposal to reduce the enormous climate impact of its oil and gas industry.”

The new rules “represent a crucial and urgently required move towards a climate-resilient future,” said Tom Green, senior climate policy advisor at the David Suzuki Foundation. “Following a summer marked by destructive wildfires and extreme weather events, it is imperative that we hold the oil and gas sector accountable to achieve immediate methane reductions, which are often underestimated by 50% or more.”

“These new methane regulations can be an initial step toward setting and achieving an ambitious cap on overall greenhouse gas emissions from the oil and gas sector, on the path to a full, fast, and fair phaseout of fossil fuels,” said Greenpeace Canada Senior Energy Strategist Keith Stewart. “Given the consistent evidence of industry under-reporting methane emissions, it will be key to have independent monitoring and testing to ensure companies meet their obligations.”

“These regulations will position Canada as a leader on reducing methane pollution, but Canada should be striving for virtual elimination of methane emissions,” said Julia Levin, associate director, national climate at Environmental Defence Canada. “We urge the government to finalize and bring these regulations into force as quickly as possible.”

Cenovus Energy Chief Sustainability Officer Rhona DelFrari told CBC her company has cut its methane emissions 59% over three years, and is aiming for an 80% reduction from 2019 levels—a considerably easier benchmark than the 2012 reference year in the new federal standard—by 2028.

“Canada has a lot to be proud of in the oil and gas sector when it comes to our methane emissions reductions,” she declared. “We’re well, far ahead of many other countries around the world that are oil-producing jurisdictions.”

But the Alberta government, with a strong presence at COP28, was quick to condemn the federal announcement. “The federal government has unilaterally established new methane emissions rules and targets,” Premier Danielle Smith and Environment Minister Rebecca Schulz said in a joint statement, that called the regulations “illegal” and “unrealistic.”

“Given the unconstitutional nature of this latest federal intrusion into our provincial jurisdiction, our government will use every tool at our disposal to ensure these absurd federal regulations are never implemented in our province,” it concludes.

Today’s federal government backgrounder notes that the latest draft of the methane regulations factored in “extensive consultation on the development and design of the proposed regulations.” As for constitutional rights, Canada’s division of powers gives provinces authority over natural resources but establishes federal jurisdiction over pollution.

This story first appeared in The Energy Mix. Read the original article here. 

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Dotan is now the CEO of Grace Breeding, an Israeli agricultural tech start-up that has developed what it says is a biological alternative to synthetic fertilizers, which emit nitrous oxide, a potent greenhouse gas, when applied in fields. Dotan’s company is one of dozens around the globe looking to offer a biological substitute to chemical fertilizers. “For many years, agriculture has grown by using chemical products,” he says. “From their production process through to application in the field, [they] are causing harm to the climate.”

As one of the main nutrients needed to grow food, along with potash and phosphorus, nitrogen has been used by farmers to fertilize their crops for millennia. The compound is naturally present in a variety of sources, from composted plants and legumes to manure and seabird poop (which was shipped around the world from Peru in the 19th century). The invention of synthetic nitrogen fertilizers, however, in the early 20th century, changed everything.

Before synthetic nitrogen was made for widespread use by farmers, governments used it to build explosives during the Second World War. After the war, the same factories that were synthesizing nitrogen for munitions shifted to manufacturing fertilizer. Since then, governments have pushed farmers to double and redouble yields (and use more fertilizer as a result) by raising food export quotas to feed the world’s growing population. Those yields have come with severe environmental impacts, as research shows that the nitrogen fertilizer supply chain accounted for more than 10% of agricultural emissions in 2018. But it doesn’t need to.

A handful of governments around the world have acknowledged that synthetic nitrogen fertilizers are a significant part of solving the problem. After all, agriculture accounts for about a quarter of the world’s greenhouse gas emissions. The European Union is aiming to reduce fertilizer use by 20% by 2030. Last year, the Dutch government set a target to reduce nitrogen emissions by 50% by 2030. In the U.S., the Biden administration has not set an emission-reduction target for fertilizer, but it has launched a $500-million program that will give grants to domestic fertilizer production it defines as “innovative” and “sustainable.”

In Canada, the federal government set a target to lower fertilizer emissions by 30% from 2020 levels by 2030, which has kicked up some controversy. Some Canadian farmers and agricultural organizations have pushed back against the target, erroneously claiming that the government is going to control the amount of fertilizer they use. Others have said it would lead to famine. The provincial governments of Saskatchewan and Alberta chimed in last summer to express “profound disappointment” in the federal government’s target, calling it “arbitrary” and an attack on farmers. But experts have said that the target can be achieved without threatening the food supply and that the solutions to reach it would actually save farmers money.

We are thus fertilizing not just fields but, indirectly, also many natural ecosystems – and interfering in nitrogen’s flows to a much higher extent than in the case of other biospheric cycles.

 

– Vaclav Smil, author of Enriching the Earth

To help farmers achieve the 30% voluntary goal, the government is funding programs that train farmers to use better nitrogen management and cover crops. One 2012 study found that farmers can use less synthetic nitrogen fertilizer by simply rotating three or four crops on a field rather than just two while producing the same amount of food. There are also other potential solutions that can bring down emissions without sacrificing yields, such as those Grace Breeding and others have developed. A large part of the battle is getting farmers on board.

Feeding our fertilizer habit

It wasn’t until the 19th century that chemists understood nitrogen cycles and the nutrient’s role in plant growth. In 1909, Fritz Haber, a German chemist working under contract for agrochemical company BASF, first synthesized the fertilizer ammonia from atmospheric nitrogen. Synthetic fertilizers really began to take off after the Second World War. Worldwide capacity more than doubled in the 1960s as part of the Green Revolution. And by 1985, the world was making more than 70 million tonnes per year. Today the chemical fertilizer market is forecast to be worth US$169.17 billion in 2023, according to the Chemical Fertilizers Global Market report – a figure that keeps climbing skyward.

In Canada, fertilizer use increased by a staggering 71% between 2005 and 2019, mostly driven by fertilizer sales in Western Canada, according to the federal government, while emissions from fertilizer application grew by 54%. In 2019, nitrogen fertilizers in Canada caused 12.75 million tonnes of greenhouse gas emissions – the equivalent of 3.9 million cars. Over the years, synthetic fertilizers have helped boost yields to feed the world’s growing population. Nitrogen expert Vaclav Smil, author of Enriching the Earth, credits the synthesizing of ammonia with keeping world hunger in check. “Without this synthesis about 2/5 of the world’s population would not be around – and the dependence will only increase,” he wrote.

But making and applying all that synthetic fertilizer is unsustainable. The production of synthetic fertilizers alone, before farmers even sprinkle the stuff on their fields, requires copious quantities of natural gas (much of which comes from fracking, at least in the U.S.) and has significant CO2 emissions. And in addition to the nitrous oxide emissions from application, excess synthetic nitrogen fertilizer can also run off into streams and other waterways, harming water ecosystems and causing massive toxic algal blooms.

“We are thus fertilizing not just fields but, indirectly, also many natural ecosystems – and interfering in nitrogen’s flows to a much higher extent than in the case of other biospheric cycles,” Smil wrote.

Solutions cropping up

Jordan Wallace knows that when he sees dandelions sprout, the soil is warm enough to start planting his crop for the season. When he sees buds on trees and lilacs blossom, he knows that there’s finally enough sunlight and little chance of frost returning. But for what the natural world doesn’t tell him, there’s data.

As the farmer-in-residence at a research hub for tech start-ups called Area X.O, Wallace is conducting research with University of Ottawa professors on the effectiveness of a fertilizer system called innovative fertile striptilling. The method, which Wallace’s father, Morley, developed, involves placing fertilizer only where the crop needs it and tilling narrow strips of land. The data from Wallace’s first two years of research have been promising: the method requires 33% less fertilizer than conventional farming practices, increases yield and profit by around 30% and decreases nitrous oxide emissions by more than 90%.

However, he says, there are still skeptics in the farming community. “Most farmers won’t look at something unless there’s a three-year study completed on it,” he says. “They want to see some research, and they want to try it on their own farm.”

The Wallaces, who own a precision agriculture firm called GPS Ontario and farm 150 acres just south of Ottawa, have been working on this system for almost a decade. But it wasn’t until Wallace started working at the Ottawa Smart Farm at Area X.O that he was able to show just how much it was cutting emissions. The organization provided sensors that measure how much nitrous oxide is coming off the crops Wallace is growing using the technique.

The government has to understand it can’t keep doubling and redoubling the output from the system if it wants to meet its emissions reduction targets.

 

– Darrin Qualman, Canada’s National Farmers Union

And the method has been productive.

“We couldn’t get above 165 bushels per acre in corn. It didn’t matter what we did. And my home farm averaged 264 bushels last year,” says Wallace.

He says the method has been slow to take off so far, largely because of the skepticism of farmers. There is also a learning curve and an initial cost to buy the necessary machinery – $75,000 to $500,000, depending on the size of the farm. But Wallace says the system can replace multiple machines. And ultimately, farmers will be spending less money on fertilizer.

No new technology needed

While there are a growing number of tech solutions coming on the market, experts say the technologies needed to bring down fertilizer emissions already exist. Sustainable farming advocates say Canadian agriculture can meet the government’s 30% target using better fertilizer management and other solutions like the enhanced-efficiency fertilizer that’s available.

“You can imagine it like if you drive your car a little differently – if you don’t accelerate as fast or drive a little slower, the fuel economy goes up. It’s the same thing with fertilizer,” says Darrin Qualman, the director of climate crisis policy and action at Canada’s National Farmers Union. “If you run the system a little differently, the emissions from fertilizer go down.”

Qualman says that “a lack of coherence” in the federal government’s policies when it comes to food exports is hampering Canadian farmers’ ability to achieve meaningful emission reductions. On the one hand, the government has a target to reduce emissions from fertilizer. And on the other hand, it has a target that increases food exports.

“The government has to understand it can’t keep doubling and redoubling the output from the system if it wants to meet its emissions reduction targets,” he says. “You can switch to a [Toyota] Prius, but if you drive twice as much, your fuel use goes up, not down.”

Back in Israel, Dotan says Grace Breeding is planning to have what it calls its bio-fertilizer on the market in Brazil, the largest importer of fertilizer in the world, by mid-2024. Researchers at the University of Londrina in Brazil tested one of Grace Breeding’s products and found that it outperformed urea, a synthetic nitrogen fertilizer, when applied to corn and resulted in fewer emissions.

The company, which completed an initial public offering last year on the Tel Aviv Stock Exchange, claims its product can reduce synthetic fertilizer use by up to 50%. While Grace Breeding wants to ultimately help farmers use less chemical fertilizer, Dotan says he sees a future in which there is a balance of biological and chemical products being used. “I don’t know what will happen in the future,” he says. “Relying 100% on chemicals isn’t the way, but relying 100% on biological products would be very hard. Farming will need to find an equilibrium point.”

Alex Robinson is an Ottawa-based journalist and deputy editor at Corporate Knights

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That was one of the central conclusions of Corporate Knights’ latest Earth Index* analysis, which found that G20 countries as a whole were not on track to meet their stated reduction targets from 2020 to 2021. The Earth Index revealed that the G20 actually saw emissions rise during this period by 23% of the reduction needed to meet their stated climate goals – a glaring “say–do” gap between their targets and actions.

If G20 countries meet their pledges, their collective emissions will shrink to 25.3 gigatonnes in 2030 (down from 38.1 gigatonnes in 2019), but these new findings do not instill confidence. Globally, emissions will need to decrease by 4% every year if the planet is going to reach net-zero by 2050. But early indications from the International Energy Agency are that emissions were up again in 2022. 

“If the G20 fully delivers on its commitments, the world would have a two-thirds chance of keeping the global annual temperature increase within a two-degree threshold,” says Corporate Knights CEO Toby Heaps. “Those aren’t odds any of us should feel great about, and this year’s Earth Index suggests we’re squandering the opportunity to reduce risk down to even that margin.”

While the G20 collectively lagged behind on its promises, the Earth Index found that high-income countries performed better, reducing their emissions by 44% of the level needed to reach their climate pledges. This was largely thanks to the pandemic-induced reduction in emissions from transportation and fossil fuel production.  Canada scored comparatively well with an Earth Index score of 93%, but still fell short of the pace it needs to set to meet its 2030 target.  

Read the full report.

Middle-income countries, however, saw emissions rise by 80% of the amount by which they would have needed to decline to be on track for meeting commitments. China scored the worst of these economies, with emissions increasing by 117% of the amount they would have needed to decrease to be on track for meeting the country’s stated net-zero commitment.  Mexico had the best score,  having reduced emissions by 184% of the reduction needed (although this is largely due to Mexico’s weak target of 22% below 2013 levels by 2030).  

The data show that while there was a dip in emissions during the early months of the pandemic, it was only temporary, as they rose again from 2020 to 2021. Corporate Knights head of research Ralph Torrie says that global leaders squandered the opportunity to chart a new course after the shutdowns of the early pandemic.  

“We continue to see half-measures and new commitments to pipelines and other fossil fuel infrastructure,” he says. “Time is running out to mount a true emergency response to climate change that would close the gap between what we know and say needs to be done and the effort we have so far been able to muster.” 

*The Earth Index measures G20 countries’ progress on emission reductions against their stated climate goals. Click here for a full explanation of its methodology. Click here for the full report. 

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Global momentum on addressing methane emissions is building, and not a moment too soon. 

Already this summer, we have had to turn our attention to the tragic reality of catastrophic weather events, with record temperatures scorching Europe in July and the wildfires that devastated the community of Lytton, B.C., for the second year in a row. It’s often said that nothing happens quickly in climate policy, but addressing methane emissions is one of the quickest, simplest and most affordable ways to make a big difference to our climate’s trajectory. With more than 100 countries (including Canada) signing on to the Global Methane Pledge at last fall’s COP26 summit – and milestone methane reports from the International Energy Agency, the United Nations Environment Programme and the Intergovernmental Panel on Climate Change – it is clear that we are now on the precipice of global action.

It is timely, then, that the federal government in Canada is in the process of developing new regulations on methane for the country’s oil and gas sector. The Pembina Institute, as part of a coalition of leading North American climate and energy organizations, has submitted recommendations, including two pivotal proposals: that the government implement new rules fast (starting in 2025) and that it commit to the near-elimination of methane emissions by 2030.

Yes we can

In these types of policy processes, government ambition-setting is important: it defines the parameters of what is considered achievable and lets industry know which way the wind is blowing, so companies can plan accordingly. But in this instance, if the federal government actively sets out to completely stop emitting methane, it would in fact be aligning itself with a pledge already made by the Oil and Gas Climate Initiative (a global consortium of companies – including from Canada – that represent 30% of global oil and gas production). This commitment demonstrates that companies themselves think methane emissions can be eliminated. The government would be wise to take them at their word and regulate that promise, especially with a federal cap on oil and gas sector emissions looming. 

As the primary component of natural gas, and therefore one of the products of oil and gas production, methane tends to be emitted either through leaky equipment (something we call “fugitive emissions”) or when companies decide to designate it a waste product and release it on purpose (“venting”) or burn it (“flaring”). But just as you would not let a leaky bathroom pipe go on leaking until your living room ceiling caved in, oil and gas producers should not let methane escape from their facilities and into the atmosphere, where – with almost 100 times the warming impact of carbon dioxide – it makes an outsized contribution to climate change.

It’s a no-brainer

Some of the things we will need to do to decarbonize Canada’s oil and gas production – the largest source of our annual emissions – require big up-front investments and take time to build (carbon capture and storage, for instance). Solving the methane problem will be incredibly cheap and straightforward by comparison. It mostly involves common-sense preventative measures, such as more regular and rigorous leak-detection and repair regimes at oil and gas facilities or the elimination of routine venting and flaring. Instead, producers can be asked to capture the methane they are emitting and sell it, or use it on-site to avoid wasting a valuable product. This also means the cost of capturing methane is always offset against the potential revenue when that methane is sold – so when natural gas prices are high (as they are now), methane abatement becomes even more affordable for producers. For example, our analysis of a 2019 study from the Canadian Energy Research Institute shows that, at current natural gas prices, oil and gas methane emissions can be reduced by 88% for only $12 per tonne of carbon dioxide equivalent (compared to the current carbon price of $50 per tonne). 

Implementing a strong regulatory framework would also allow Canada to maintain its place as a global leader on methane. Otherwise, we risk falling behind standards being set elsewhere, such as in New Mexico (where all routine venting and flaring is already prohibited) and by the U.S. Environmental Protection Agency. The recipe for success includes close collaboration between our federal and provincial governments, as well as with the United States. In fact, Prime Minister Justin Trudeau and President Joe Biden have already highlighted methane as an important area of collaboration in a wide-reaching agreement called the 2021 Roadmap for a Renewed U.S.-Canada Partnership.

This would spur the kind of innovation that tends to be great news for Canadian industry. According to the Methane Emission Leadership Alliance, a grouping of Canada’s leading methane-reduction practitioners, there are more than 170 Canadian companies providing methane-emissions management solutions right now – 80% of which say they expect jobs to grow as a result of methane regulations.

In this sense, we should all be excited about methane, given that it presents us with a win-win-win for the government, industry and Canadians. On our path to net-zero by 2050, this is a rare opportunity that we should grasp with both hands.

The post New rules are coming for methane emissions in Canada. And not a moment too soon. appeared first on Corporate Knights.

The satellites using this technology won’t be offering pretty pictures; they’ll be doing chemistry, analyzing spectral fingerprints, and telling oil and gas investors where all the leaking methane is coming from. And their data is getting snatched up by firms that analyze the environmental credibility of corporations.

Raw, unstructured satellite data has become an essential tool for investors in the oil and gas sector. Energy companies have a reputation for poor disclosure on their emissions of methane, the number-one anthropogenic heat-trapping greenhouse gas. A recent International Energy Agency report found that methane emissions from the energy sector are 70% higher than the official figures being reported.

Investors increasingly equate poor ESG (environmental, social and governance) performance with material financial risk. Trillions of dollars are now aligning with ESG, which means that tracking corporate adherence to ESG principles has become big business – and large investment firms are increasingly using satellite data to inform their analytics.

Big asset management firms like BlackRock, State Street and Vanguard have internal analytic teams but also purchase data sets from analytics firms such as MSCI, Sustainalytics or Affinitiv, which are integrating satellite data into their corporate ratings.

“MSCI might buy that data from the satellite [data] company and then sell it on to State Street,” says Todd Cort, co-director of the Yale Center for Business and the Environment. “And then more and more frequently, MSCI will just buy the company itself because they’ve got good data investors want. We’ve actually been seeing that a lot lately – these data analytic firms buying up these satellite [data] companies and these social-media-scraping companies.” For example, in 2019, Moody’s bought California-based Four Twenty Seven.

Satellite data is such a hot commodity that investors are turning to it to solve all their transparency issues. And with increasing regulatory focus on methane emissions from the oil and gas industry, it’s no wonder satellite data products are evolving to accommodate this demand. A satellite data platform called MethaneScan, developed by start-up company Geofinancial Analytics, is now distributed by media conglomerate Bloomberg as part of the alternative data catalogue at Bloomberg Enterprise Access Point. And it is activist by design.

“[We] aim to drive rapid methane emissions reduction through satellite-enabled transparency and engagement,” says Mark Kriss, co-founder and CEO of Geofinancial, in an email. “[We] use empirical data and insights to enable major players in the capital, insurance and commodity markets to effectively engage with producers and incentivize rapid change.”

Much has changed in the last decade. In 2011, Montreal-based entrepreneur Stephane Germain founded a private satellite company called GHGSat and, in 2016, launched its demonstrator satellite, Claire. “We were just beginning to show how our demonstration satellite could detect emissions from space,” says Germain. “Today, we routinely detect emissions on a daily basis.” In May of this year, GHGSat launched three more methane-tracking satellites.

We know from over 10 years of doing field studies, every company that thinks they don’t have a [methane] problem does.

—Mark Brownstein, Environmental Defense Fund

Germain, too, says the “surge in ESG investing has driven significant interest from the financial services community.”

The New York–based non-profit Environmental Defense Fund (EDF) has spent more than a decade trying to measure and understand the methane over the Permian Basin, the world’s largest oil patch, in the southwestern United States. EDF research revealed that as much as three times more methane emissions have been identified than companies self-reported to the U.S. Environmental Protection Agency. To get a handle on emissions, the environmental group has used handheld devices, airborne spectrometers and NASA satellite data, which also had to be analyzed.

Now it’s launching its own satellite.

“We know from over 10 years of doing field studies, every company that thinks they don’t have a problem does. What’s been missing is the data to show,” EDF’s Mark Brownstein said in a 2021 interview. That led EDF to raise the US$88 million it would take to fund its own satellite project, MethaneSAT. The goal: “Making that data transparent to the public, to policy-makers, to their investors, to competitors,” Brownstein said. “Now everybody can see what’s going on out in the field.”

Cort has advised many companies on activist investor resolutions. “Those companies that are exposed by organizations like EDF, they get bad press … They get regulators breathing down their necks saying, ‘Why aren’t you dealing with your methane issues?’ They may not get as many permits or royalty holders signing up for their extraction activities.”

The most famous investor uses of satellites involve imagery that’s used to, say, count cars in Walmart parking lots or track shadows of Chinese oil tanks through Google Earth or web-geo platform Planet. A wide range of environmental groups also use visual imaging satellites: Global Forest Watch surveys forests for illegal logging; Global Fishing Watch surveys the open seas for illegal fishing. But methane satellites don’t provide visual imagery; they use spectroscopy.

Kelly Vaughn, spokesperson for non-profit Carbon Mapper (which runs a satellite program to track methane and CO2 emitters), explains that imaging spectroscopy “measures solar backscattered radiation, where methane and CO2 are known absorbers.” The rest is a lot of math work.

“For as much as people are focused on the hardware, the satellite, the sensor, what you get from the satellite is basically a set of ones and zeroes. And it’s a lot of data,” Brownstein said. “Equally important is the data science behind this.”

The California Air Resources Board is planning to use Carbon Mapper to strengthen and enforce its methane-reporting framework. When MethaneSAT and Carbon Mapper are up and running in 2023, that stream of continuous data should help rapidly advance greenhouse gas regulation and enforcement.

[We] aim to drive rapid methane emissions reduction through satellite-enabled transparency and engagement.

—Mark Kriss, co-founder and CEO of Geofinancial

Canada’s GHGSat will also be contributing its data sets, along with those of European satellites, to a global methane-monitoring clearing house called the International Methane Emissions Observatory (IMEO). As the world’s largest importer of oil and gas, the EU Commission created IMEO to gather the hard data on which to build its methane regulatory framework, which is currently further along than those of Canada and the United States.

EU demand for robust methane-emissions transparency is precisely the future investors are watching out for. And private companies like Geofinancial and GHGSat can best spur both non-profit and investor activism by providing crystal clarity in the data, unfogged by omissions. Even so, satellite-based climate activism is very much still in a nascent, unregulated stage.

“There are lots of loose ends that need to be tied up for successful activism with these data,” says Deborah Gordon, senior principal for the Climate Intelligence Program at RMI (previously the Rocky Mountain Institute). RMI has launched a platform specifically geared to facilitating reporting of oil and gas emissions data and related planning.

“What will regulators do when a super emitter is spotted?” says Gordon. “And what emissions level constitutes a super emitter?”

Regulation of greenhouse gases has been slow. In California, Carbon Mapper data will ease its way into an ongoing regulatory framework that has been in the making for more than 15 years. Investors have recently heard from financial regulators in Canada, the United States and the EU putting forth greenhouse gas disclosure proposals. But in the United States at least, the Securities and Exchange Commission’s proposed disclosure rule is expected to meet a lengthy trial by litigation.

“I think the lawsuits are already lining up,” Cort says.

With regulatory signals up in the air, conservative institutions aren’t approaching satellite data as actionable yet.

“Most companies are biding their time,” Gordon says. “But there is general interest.”

At a time when scientists are pinning hopes on reducing methane emissions as a Hail Mary pass to avert climate disaster, keeping an eye on elusive emissions is critical. As the activist investors of tomorrow turn to the skies, methane emissions will have nowhere to hide.

Marianne Messina is a freelance journalist focusing on sustainability and conservation issues, particularly where systems and remote technologies are involved.

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The technology, known as direct air capture, has lately gathered steam as climate scientists warn that, without it, humanity stands little chance of limiting global warming to acceptable levels. In its latest report, the Intergovernmental Panel on Climate Change said that using carbon removal – which also includes measures such as planting trees or enriching the soil with minerals – will be “unavoidable” if the world wants to hit net-zero emissions.

Buoyed by those predictions, the industry has already gathered serious momentum. U.S. President Joe Biden’s infrastructure package allocated $3.5 billion for several direct-air-capture hubs last year, and plans are underway to build the first truly large-scale plant in the southwestern United States, which will eventually trap up to one million tonnes a year.

Private investors have also piled in: Climeworks, a Swiss company that is one of the burgeoning industry’s biggest players, bagged US$650 million in its latest round of fundraising. And corporations from tech giant Alphabet to payments company Stripe recently committed close to US$1 billion to buy removals from innovative start-ups in the space.

That is not to say direct air capture is without its critics. Some point out that the vast amounts of energy needed to draw heavily diluted carbon out of the air is better used elsewhere. Others fear that relying on so-called negative emissions technologies is merely giving high-emitting companies an excuse to keep on polluting, with catastrophic consequences for the climate.

Although it may sound high-tech, drawing carbon from the air is surprisingly straightforward in practice. At Climeworks’s flagship facility in Iceland, the largest in the world, stacks of giant fans suck in the ambient air; inside, it passes over a filter that collects the carbon dioxide, which is then released under high heat. (Other companies separate the carbon by passing air through chemical solutions instead.) Nearby, another plant run by the Icelandic company Carbfix mixes the concentrated carbon with water inside a group of pentagonal spheres that lend the site the eerie look of a space colony. The mixture is then pumped deep underground, where it reacts with basalt rock and turns solid within a few years.

That the plant sits in Iceland is no accident: the country has plenty of clean geothermal energy for the power-hungry process, as well as suitable geological storage to permanently sequester the carbon. Under those conditions, direct air capture can have a much higher impact than capturing emissions from factories or power plants, since it traps CO2 without releasing any emissions in the first place.

That promise and the potential to use the captured carbon for a range of low-carbon technologies – mixing it into cement or producing jet fuel and feedstocks for plastics, for example – has attracted big names from sectors that are notoriously hard to decarbonize. United Airlines has directly invested millions in the first large-scale project being built in the United States, which is being developed by Houston-headquartered oil firm Occidental and will partly use the captured carbon to make jet fuel. Other major companies from Shell to Apple also rely on carbon removal in their net-zero plans. And 18 of the 50 countries that have submitted long-term climate strategies to the UN specifically mention technological carbon removal.

One caveat to direct air capture’s climate potential is the type of energy used. Researchers have found that rapid, large-scale deployment of the technology could require up to a quarter of global energy demand by 2100, underscoring the need to use renewable energy or waste heat.

It’s absolutely not a magic bullet; it’s absolutely not an alternative to mitigation. But we do need this … to undo the damage that we’ve done.

—Niall Mac Dowell, Imperial College London

For now, the technology is also still expensive: Occidental estimates that it will cost between US$300 and $425 to sequester each tonne of carbon at its plant. Companies throughout the industry are confident that successive projects will drive costs down quickly. Nevertheless, even some of the industry’s champions are skeptical of the slew of start-ups that have sprung up.

“You are seeing lots of people making big promises right now, and they don’t quite know how to keep them,” Klaus Lackner, the director of Arizona State University’s Center for Negative Carbon Emissions and a pioneer in direct air capture technology, told the MIT Technology Review.

Perhaps the most common criticism of carbon removal, and one that has dogged direct air capture for years, is that it could afford companies a fig leaf to keep pumping out CO2 by relying on technology that is not guaranteed to become commercially successful.

Executives at direct-air-capture companies are quick to echo what experts have long emphasized, however: that cutting emissions first should be every company’s priority. “The best way is not to clean up your mess; the best way is to not cause the mess in the first place,” says Andreas Aepli, Climeworks’s CFO.

Aepli thinks the relatively high cost of direct air capture means most companies still have every incentive to prioritize emission cuts. But he also points to growing scientific consensus around carbon removal, with most assessments estimating that we will ultimately need to remove between five and 15 billion tonnes of carbon a year by 2050 to keep global warming to 1.5°C. Under the International Energy Agency’s net-zero scenario, direct air capture alone is projected to sequester close to one billion tonnes a year.

Nature-based carbon removal, such as planting trees, is certain to play a larger role, too. But there are limits to growing forests, and wildfires can quickly release all that trapped carbon. That means technological carbon removal will likely be necessary to compensate for emissions from hard-to-abate sectors like aviation or heavy industry, as well as to draw down already accumulated emissions in the atmosphere.

“It’s absolutely not a magic bullet; it’s absolutely not an alternative to mitigation,” says Niall Mac Dowell, a professor at Imperial College London who studies carbon removal. “But we do need to do this … to undo the damage that we’ve done.”

That also leaves the companies that are championing carbon removal with a daunting task. For now, Climeworks’s flagship plant in Iceland traps only about 4,000 tonnes of carbon per year; altogether, the roughly 20 direct-air-capture pilot plants operating around the world have capacity for around 10,000 tonnes – far from making a meaningful impact.

You are seeing lots of people making big promises right now, and they don’t quite know how to keep them.

—Klaus Lackner, director of Arizona State University’s Center for Negative Carbon Emissions

Another question is what to do with the captured carbon. Early projects have focused on selling it for use in a wide range of consumer goods, from fizzy drinks and vodka to diamonds and watches, and start-ups focusing on niche applications now abound. But experts and executives at direct-air-capture companies agree that the most effective pathway will be storing it away permanently.

“We can make yoga pants out of carbon,” says Lori Guetre, head of business development at British Columbia–based Carbon Engineering, which is providing the technology for Occidental’s plant. “But each one of those markets is small. And what we find, even when we talk to cement production plants, is they only need a really small amount of CO2 per plant.”

That’s not to say the explosion in so-called carbon tech is not useful to help kickstart the industry. Lauren Riley, head of sustainability at United Airlines, says sustainable jet fuel will play a large role in the company’s reaching its net-zero goal. But since it could be decades until that is available at the necessary volume and price, financing carbon removal in the meantime makes sense. “It’s a very practical solution to enable that transition,” she says.

“Obviously, if you’re talking about battling climate change, you’re going to ultimately need some level of sequestration,” says Fred Moesler, chief technology officer at Global Thermostat, another direct-air-capture company that is building its own plant in Colorado. “But I really think we should be doing everything at this point in time to encourage technologies like ours to develop.”

Despite the explosion in corporate interest, companies in the industry say direct air capture will take off only if governments incentivize it by creating mandatory markets. Occidental’s plant in the Permian Basin, which combines carbon sequestration with jet fuel production and enhanced oil recovery, is taking advantage of tax credits and low-carbon fuel standards. Incentives have also ramped up in Canada, where the most recent budget proposed a 60% tax credit for direct-air-capture projects. Most promisingly, recent bills introduced by Democratic lawmakers at the U.S. federal level and in New York State would see the government directly procure carbon removal.

“We’re super excited about the voluntary market, but we see it as a means to accelerate how quickly we can get going,” says Guetre. “It’s not going to do the heavy lifting over time for these projects.”

Jennifer Wilcox, principal deputy assistant secretary for the Office of Fossil Energy and Carbon Management at the U.S. Department of Energy, acknowledges that available tax credits are still “a drop in the bucket” for direct-air-capture projects. But she says it’s still premature to discuss public procurement of carbon removals, since metrics for measuring the sustainability of emissions savings still need to be ironed out.

“I think we still have a lot of work cut out for us with the investments that we’ve already been making,” Wilcox says.

In the meantime, Occidental is already planning dozens of plants alone and Carbon Engineering has struck similar partnerships with developers in Canada, the United Kingdom and Norway. Climeworks is planning to use its own design in a series of larger installations over the coming years, ultimately reaching its own megatonne plant. That’s not to mention all the smaller companies waiting in the wings.

With many experts now saying that direct air capture will be necessary to rein in climate change, the biggest challenge for the technology, arguably, is growing quickly enough before it is too late.

“There’s really no way to get to net-zero without carbon removal, both natural and technological,” says Katie Lebling, a carbon removal expert at the World Resources Institute. “And the need for it will only increase.”

Yannic Rack is a journalist based in London and mainly writes about business, climate change and the environment.

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