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Around the world, scientists and entrepreneurs
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are finding promising new ways to remove carbon dioxide
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from the atmosphere and ocean
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in order to curb the effects of climate change.
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Why?
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To avoid the worst effects of climate change,
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it won't be enough to just reduce emissions.
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We'll also need to permanently remove huge amounts of CO2
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already in the atmosphere and oceans.
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Five to 10 billion tons per year by 2050.
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While we have some ways to remove carbon,
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such as reforestation and soil carbon sequestration,
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these solutions are unlikely to scale
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to the size of the problem.
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We need a gigaton scale portfolio
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of permanent carbon removal solutions.
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Luckily new approaches, like kelp forests,
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bio oil injection and direct to air capture
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are just a few of the exciting innovations underway.
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But so far they've all faced the same problem,
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they have no customers.
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New technologies like solar panels, hard drives
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and DNA sequencing tend to be expensive at the start,
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but costs come down over time as they scale.
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Carbon removal is at the beginning of a similar trajectory,
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and because it's expensive today,
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most companies would rather buy low-cost alternatives.
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The problem is, without customers,
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these technologies can't scale to reduce their costs.
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Not only that, but investors don't want to invest
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in companies if it's unclear that anybody will buy
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what they're selling.
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So without customers and investment,
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the carbon removal ecosystem has been a bit stuck.
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Frontier is a new initiative planning to spend
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a billion dollars buying carbon removal
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over the next nine years.
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It's a simple idea.
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By guaranteeing future demand for these technologies now,
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we hope to help them scale up and get cheaper, faster.
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There's actually lots of capital.
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There's lots of excitement and interest in climate.
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There's lots of people who wanna work on it.
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But there's not a lot of buyers out there
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who are actually willing to put down the money to say,
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okay, go put the carbon underground.
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We've seen this cycle before.
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In the mid-2000s, poorer countries lacked access
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to the pneumococcal vaccine.
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Pharma companies weren't motivated to spend the resources
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developing the vaccine because they were unsure
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there'd be enough demand to recoup their costs.
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In 2009, governments and philanthropists pledged
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to spend $1.5 billion to subsidize the purchase
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of the pneumococcal vaccine
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if the pharmaceutical companies could produce it
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at a low enough cost.
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Hundreds of millions of vaccine doses were purchased
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and distributed throughout the world,
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accelerating the vaccine rollout by five years,
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and saving an estimated 700,000 lives.
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This model, guaranteeing demand
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to accelerate the development of a new product,
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is called an Advance Market Commitment, or an AMC.
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The idea is to send a signal to researchers, entrepreneurs
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and investors that there will be a big market
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for their technologies.
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In other words, start building.
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AMCs worked for vaccines, and we think they can work
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for carbon removal too.
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Here's how Frontier works.
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Buyers decide how much they want to spend on carbon removal
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and pool their commitments through Frontier.
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Frontier's team of technical and commercial experts find
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and vet suppliers to identify
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the most promising technologies,
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and then facilitate purchases between buyers and suppliers,
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either upfront or through offtake agreements.
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Once we have a guaranteed buyer, then we can secure
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the financing to build our next plant, we can grow our team
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and attract the investment that we need to scale.
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Finally, as carbon removal is delivered,
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suppliers are paid and tons of carbon removal
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are passed back to buyers.
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Over the next nine years,
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Frontier's members will spend nearly $1 billion
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buying permanent carbon removal.
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On the one hand, it's a lot of money,
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around 30 times what's been spent to date.
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On the other hand, it's less than 1%
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of what we need to spend every year by 2050.
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So there's a long way to go.
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And our hope is that more buyers will join Frontier
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in the months and years ahead.
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But our message to the carbon removal world today
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is loud and clear:
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Build and we will buy.