Frontier buyers sign first $53M in offtake agreements with Charm Industrial

May 18, 2023

  • Charm Industrial will remove 112,000 tons of CO₂ between 2024 and 2030 on behalf of Frontier buyers.
  • Biomass Carbon Removal and Storage (BiCRS) could support gigatons of CO₂ removal per year, offering a promising path to permanent carbon removal at scale.
  • Frontier has facilitated purchases on behalf of Frontier Founding Members Stripe, Alphabet, Shopify, Meta, and McKinsey Sustainability, as well as Autodesk, H&M Group, and Workday. Also, Aledade, Boom Supersonic, Canva, SKIMS, Wise, and Zendesk have purchased via Watershed’s partnership with Frontier.

Frontier has facilitated its first set of offtake agreements with Charm Industrial, totaling $53M. Frontier buyers will pay Charm to remove 112,000 tons of CO₂ from the atmosphere and store them permanently underground between 2024 and 2030. Buyers will pay a price per ton that will decline by at least 37% between 2024 and 2030, and could decline by as much as 75% based on Charm’s current scaling plans and the potential for expanded government incentives. The price accounts for both the removal itself as well as measuring, reporting, and verifying (MRV) that each ton is safely stored and accounted for according to a rigorous protocol.

Charm collects waste biomass that’s left over from agricultural harvests or forest fire management, and heats it to a very high temperature in an oxygen-deprived environment—a process known as pyrolysis. The resulting bio-oil is then injected into EPA-regulated wells, where it sinks and solidifies permanently. Pyrolyzers are small and modular, moving from farm to farm on the back of a truck bed, minimizing the need to transport the raw biomass. Beginning operations in 2021, Charm Industrial was one of the first companies to successfully remove carbon from the atmosphere permanently and today leads the market, having delivered 6,160 tons to date via pilot processes.

Charm Industrial is one of a number of companies pursuing biomass carbon removal and storage (BiCRS). BiCRS offers a promising approach to permanent carbon removal because it harnesses the natural capture of CO₂ by plants, and has the potential to reach climate-relevant scale in the medium term. Experts estimate¹ that enough waste and residue biomass could be available globally by 2050 to support gigatons of carbon removal annually. BiCRS is one of many compelling approaches to carbon removal that Frontier is considering as it builds a diverse portfolio of solutions. Frontier will announce a series of additional offtake agreements by the end of the year.

play iconCharm Industrial converts biomass into a stable, carbon-rich liquid and then pumps it deep underground, where it is stored permanently.

Charm Industrial converts biomass into a stable, carbon-rich liquid and then pumps it deep underground, where it is stored permanently.

Offtake agreements help carbon removal suppliers scale their operations. They are legally binding contracts to buy future tons of carbon removal at an agreed price if and when delivered. These agreements also include pre-delivery milestones—important stage-gates on performance and project details suppliers have to meet prior to delivering carbon removal. Offtake agreements help companies access capital to scale by providing investors with a guarantee of future demand. Frontier looks for companies that have the potential to be low-cost at scale—even if they’re expensive today—and helps accelerate them down the cost curve via offtakes.

Frontier founders Stripe, Alphabet, Shopify, Meta, McKinsey Sustainability, and members Autodesk, H&M Group, and Workday will all make purchases as part of the agreement, and expect to sign additional offtakes later in the year. Aledade, Boom Supersonic, Canva, SKIMS, Wise, and Zendesk will participate with purchases via Frontier’s partnership with Watershed.

Candidates for offtakes are reviewed by Frontier’s technical staff and a group of 50 scientific and technical reviewers with expertise in fields including bioenergy, geochemistry, ecology, geologic storage, governance, and waste management.

Peter Reinhardt, Co-founder and CEO, Charm Industrial: “An offtake, especially one of this size, lets us move meaningfully faster than we’d otherwise be able to, accelerating essentially all aspects of our technology and operations. Frontier has been an incredibly rigorous buyer, testing and pushing our limits across science, operations, engineering, finance, and our future cost curves. We’re thrilled to have their confidence in our progression toward removing billions of tons of carbon from the atmosphere.”

Nan Ransohoff, Head of Frontier: “In just three years, Charm Industrial has gone from concept to permanently removing thousands of tons of CO₂. They’ve charted a feasible path to high-volume, low-cost carbon removal, and set the bar for executing with speed and rigor.”

1. Based on estimates in Slade et al (2014), Tripathi et al (2019), and the BiCRS Roadmap (2020).