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Nasdaq acquires majority stake in Puro.earth carbon removal platform

03 June 2021 Kevin Adler

US financial services company Nasdaq said 1 June it had acquired a majority stake in Puro.earth, a marketplace for carbon removal.

Nasdaq intends to scale up Puro.earth's operations, based in Finland, to address a growing demand for carbon removal by corporations, it said. The platform, launched in April 2019, counts companies such as Microsoft and the Swedish financial group SEB as participants.

Puro.earth calls itself the world's first business-to-business marketplace, standard, and registry focused solely on carbon removal. Its customers are issued CO2 Removal Certificates (CORCs) for each metric ton of carbon dioxide removed and verified by an independent third party that meets Puro.earth's methodologies.

In an email to IHSMarkit, a spokeswoman for Puro.earth said its marketplace has led to the removal of more than 70,000 mt of CO2, "and we expect it to grow over the coming years as the carbon removal market scales up."

Puro.earth is working with about 10 carbon removal suppliers currently, she wrote, and has "145 in the pipeline."

Issued CORCs can be traded and canceled on Puro.earth's CO2 Removal Marketplace. Buyers to date have included multinational companies with operations in the US, Europe, and Asia.

Prices on the exchange are about €20/mt ($24.28/mt) of CO2 removed, according to the spokeswoman, but she added: "An average price is not very descriptive when the market is so fragmented."

Puro.earth's methodologies cover carbon removal from numerous technologies: biochar; concrete and other building elements; wood building elements; carbon capture and storage; and geologically stored carbon from biogenic sources.

Nasdaq said it will work with Puro.earth to further strengthen the governance around new methodologies by establishing an external advisory committee with representation from the industry, academia, and suppliers.

While the Puro.earth program is voluntary, the spokeswoman observed the potential convergence of voluntary and mandatory programs around the world. "Both 45Q in the US and EU climate law recognize or [create] separate quotas for CO2 removals, and this can be seen as an indicator that CO2 removals would be integrated into mandatory programs in the long run," she wrote.

As explained by the US Department of the Treasury, Section 45Q of the US tax code provides credits for capturing and sequestering carbon oxides. Final regulations were issued on 6 January 2021 to define how a carbon-capture operation can qualify for the credits, measure the amount of carbon that has been captured, and sets standards for claiming and using the credits.

Terms of the transaction have not been disclosed. Finnish energy company Fortum will remain a minority owner.

--Includes reporting by Abdul Latheef, OPIS.

Posted 03 June 2021 by Kevin Adler, Editor, Climate & Sustainability Group, IHS Markit

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