Microsoft has signed the world’s largest carbon capture deal to date.
Stockholm Exergi this week announced that it has signed a contract with the cloud company to remove carbon from an upcoming biomass plant in Sweden.
The deal will cover 3.33 million tonnes (3.67 million tons) of permanent carbon removals from bio-energy with carbon capture and storage (BECCS) at Värtan, Stockholm.
BECCS involves capturing and permanently storing CO2 from processes where biomass is converted into fuels or directly burned to generate energy.
“We are extremely proud to announce this carbon removal offtake with Stockholm Exergi from its pioneering Värtan BECCS project," said Brian Marrs, senior director, energy & carbon removal. "Leveraging existing biomass power plants is a crucial first step to building worldwide carbon removal capacity."
The 10-year deal is set to start in 2028. When in operation, Stockholm Exergi’s plant will permanently remove up to 800,000 tonnes of CO2 from the atmosphere per year.
“The agreement with Microsoft is a huge step forward for our BECCS project, Stockholm Exergi as a company and the climate,” added Anders Egelrud, CEO of Stockholm Exergi.
“I believe the agreement will inspire corporations with ambitious climate objectives, and we target to announce more deals with other pioneering companies over the coming months.”
The environmental permit for the project was obtained in March this year; construction of the carbon capture unit, liquefaction, and intermediate storage is planned to start in 2025.
However, Stockholm Exergi said its final investment decision on the project is planned for Q4 this year. The company said the funding of the project relies on already awarded means from the EU Innovation Fund, but additional revenues from selling carbon removal units are required for the project to reach financial close.
Microsoft is a major investor in carbon capture projects as it seeks to reach not only carbon neutrality but also remove its historical emissions.
The company has signed several biochar deals, and also signed a deal with Carbon Streaming to buy credits from its biochar site in Virginia.
Other carbon capture projects undertaken by the company include a 300,000-ton deal with Heirloom signed last year, which will remove carbon directly from the air onto sheets of calcium oxide. It has also done a 10,000-ton deal with Climeworks, an electrical direct capture company, and paid for an undisclosed amount captured in Wyoming by Carbon Capture.
Meta, Alphabet, and Colt have all invested in carbon capture.
