Engineered carbon removal costs rise as market matures
Updated
Updated · The Wall Street Journal · May 8
Engineered carbon removal costs rise as market matures
12 articles · Updated · The Wall Street Journal · May 8
A recent OPIS and CDR.fyi survey found biochar prices rose 10%, direct air capture 11%, and biomass storage roughly doubled per metric ton of CO2 removed.
Developers said tighter funding, the need to cover operations through sales, and proven on-time delivery records are letting established projects charge more, challenging expectations that scaling would cut prices.
Most suppliers still expect reasonable profits by 2030, but durable removals remain tiny versus climate needs, with registries verifying far fewer engineered removals than nature-based credits.
Companies are paying for carbon removal, but with only 3% delivered, where is the money actually going?
As carbon removal costs rise, is the dream of affordably reversing climate change already fading?
Navigating the $1.5 Trillion Carbon Market: Engineered CDR Growth, Costs, and Policy Impacts 2024-2026
Overview
Between 2024 and 2026, the engineered carbon removal market grew rapidly, driven by strong corporate demand that led to record forward contracts of 45 million tonnes in 2025. Despite this growth, high technical complexity, rising material costs, and regulatory uncertainty increased removal costs significantly. These challenges made forward contracts essential for securing financing and managing risks, while policy shifts introduced both obstacles and support for related clean energy sectors. Buyers are adopting diverse portfolios balancing costly, durable engineered removals with cheaper nature-based solutions. Looking ahead, rising demand and supply constraints suggest prices will continue to increase, emphasizing the need for stable policies and innovative financing to scale carbon removal effectively.