Pioneering Collaboration: British Airways Supports Innovative Debt Financing for Carbon Removal Solutions

A new and pioneering collaboration has been established by British Airways and Standard Chartered, along with two other prominent businesses, to pilot a unique model for financing carbon removal solutions. The aim of this innovative initiative is to unlock debt financing for carbon removals secured on future client demand through advanced purchase agreements.

As the world grapples with the pressing issue of climate change, several major corporations are already engaging in multi-year advance purchase agreements for carbon removal. This includes the employment of man-made technologies such as direct air capture and rock weathering, with industry leaders like Microsoft, Meta, Shopify, Stripe, and Alphabet Inc. (Google’s parent company) at the forefront of this movement.

Despite the growing demand for carbon removal solutions, suppliers in this fast-evolving market continue to face significant challenges in securing traditional banking products like commercial debt. This has created a major bottleneck for the industry, hindering its ability to achieve commercial scale. In response to this challenge, British Airways, Standard Chartered, CUR8, and UNDO have joined forces to lay the foundation for a new financing blueprint.

Marta Krupinska, the Chief Executive and Co-founder of CUR8, emphasized the critical need for innovative financing to support the rapid technological and scientific advancements in the carbon removal sector. She expressed enthusiasm for the pilot collaboration and its potential to bridge the financing gap, allowing promising carbon removal suppliers to achieve scalability.

As a key player in this collaborative effort, British Airways has pledged its support by committing to the purchase of over 4,000 tonnes of carbon removal credits delivered by UNDO, a leading supplier of carbon credits generated through advanced rock weathering. While this initial purchase may seem relatively modest, it represents a significant step towards unlocking future investments in carbon removals and advancing the scale-up of carbon removal technology.

Carrie Harris, the Director of Sustainability at British Airways, emphasised the importance of this partnership in paving the way for future investments in carbon removals. This initiative aligns with the airline industry’s commitment to reach net-zero for both domestic and international flights, with British Airways making substantial investments in next-generation carbon removal solutions since 2019. By leveraging offsets and removals, the airline aims to address a third of the necessary emissions to meet its net-zero targets by mid-century.

In a related feature, questions have been raised about potential loopholes in government plans to scale carbon capture. These discussions underscore the complexity and significance of the ongoing efforts to develop effective strategies for carbon removal and climate action.

As the world continues to confront the challenges posed by climate change, collaborative initiatives like the pilot program undertaken by British Airways, Standard Chartered, CUR8, and UNDO are crucial in driving innovation and accelerating the transition towards sustainable and environmentally responsible practices.

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