How Google, McKinsey and others got finance to say “yes” on nature-based carbon removals

Carbon markets have transformed over the past five years, with updated standards and rigorous due diligence frameworks giving sustainability leaders much more confidence in project design. Still, signing an agreement to buy an invisible good in the future remains a tough sell, particularly when that good is not strictly required. 

At Symbiosis, a buyers coalition representing Google, Microsoft, Meta, McKinsey, Salesforce, REI and Bain, our members have signed deals covering more than 40 million metric tons of nature-based carbon removal over the past three years. Long-term offtake agreements have been core to this effort. The deals lock in price and volume today, providing budget predictability while ensuring the supply needed to hit sustainability goals. Yet some of our members had never signed a 10-year offtake agreement before joining Symbiosis. 

Here are three strategies we used to get CFOs comfortable with these deals. 

Evaluate delivery risk

The job of any CFO is to manage risk. To justify committing budget toward carbon removal offtakes, they need assurance that the tons will be delivered as promised. That means addressing what’s known as “delivery risk.” 

This is a separate challenge from assessing project design or the quality of a credit that’s already been delivered. An early-stage project could develop a high integrity project design with the most robust carbon accounting methodology and stakeholder engagement plan, and still fail to deliver due to implementation delays, financing gaps or regulatory change. These risks should be part of your diligence — look at factors such as project developer financing, track record and pilot implementation. To mitigate delivery risk for participating buyers, Symbiosis carefully examined each of those factors as part of its diligence process with project developers Mombak, Living Carbon and Thryve.earth.  

Apply the renewables playbook 

Fortunately, corporate buyers have been here before. Renewable energy purchases also required companies to commit to contract future power from a solar or wind facility that didn’t yet exist. The market solved this problem through power purchase agreements (PPAs), long-term forward purchase contracts that give early-stage renewables developers price and volume certainty. PPAs allocate risk between developer and buyer in a way that CFOs are comfortable with. Buyers can help CFOs get comfortable with carbon removal offtakes by making this analogy clear. 

Incorporate buyer protections into contracts

These contracts are typically structured on a pay-as-you-go basis, ensuring companies only pay for what they receive. But buyers can negotiate additional protections, such as minimum delivery thresholds paired with replacement credits or other forms of compensation should the developer fail to meet obligations. Symbiosis’ standard offtake agreement includes such protections, to align incentives and protect buyers in underdelivery scenarios. Developers will factor the cost of these safeguards into the per-ton price — the result should be a deal structure that places risk with the party best positioned to mitigate or absorb it. 

What you can do now

As the science advances, the risks in nature-based carbon removal projects are increasingly known, assessable and quantifiable. The frameworks and tools needed to start the conversation with your CFO today exist. Start with our Carbon Offtake Guide, the result of a process involving developers, buyers and investors that began at last year’s Climate Week NYC — and use it to get your finance team to “yes.”