This startup aims to solve carbon removal’s trust problem. JP Morgan and Shopify have signed on

The voluntary carbon market has a trust problem. Isometric, a two-year-old carbon registry that counts JPMorgan Chase & Co., Shopify and Stripe among early customers, is proposing a solution.

Isometric offers monitoring, reporting and verification (MRV) services to authenticate credits generated by nascent approaches to durable carbon removal, including direct air capture, biomass with carbon removal and storage, and enhanced rock weathering. 

Its approach is unique, among other things, for its payment model: Buyers pay a flat fee to Isometric that is built into carbon removal purchase contracts. Other carbon credit registries collect a per-credit fee from project suppliers as credits are delivered, a practice criticized as a potential conflict of interest. 

Isometric was founded two years ago to offer an alternative. Backed with $25 million in venture capital from investors including Lowercarbon Capital and Plural, it is developing protocols for assessing projects and verifying their performance. It publishes that information, checked by independent auditors, openly.

“This is too important to get wrong, but there’s a lot to get right,” said Eamon Jubbawy, founder and CEO of Isometric, who previously founded identity management software firm Onfido, acquired for $650 million in early 2024. “We publish everything hyper transparently and invite people to look at it.”

On Aug. 22, Isometric delivered verified credits to JP Morgan, Shopify and Stripe under their contracts with Charm Industrial, which collects and stores carbon dioxide in the bio-oil injected underground. The delivery was modest, representing 107 metric tons of carbon removal but registry services such as the ones Isometric offers are necessary for the market to grow.

“It’s totally fair for the media and public to continually question the quality of credits that are issued,” said Alexander Rink, co-founder of market watcher CDR.fyi. “That is why it’s so important for there to be a higher level of scrutiny and transparency around them.”

Why carbon removal credits matter

JPMorgan is paying $200 million to suppliers including Charm, Climeworks and CO280 Solutions in May 2023 to purchase credits representing 800,000 metric tons of carbon removal. It also joined Frontier, the buyers group that has committed to $1 billion in contracts by 2030. 

These credits will help the financial services firm address unabated Scope 1 emissions from its own operations, as well as corporate travels, said Taylor Wright, head of strategy and carbon management, operational sustainability, at JPMorgan Chase. “Ultimately, MRV is critical to ensuring the actions we are taking as part of our broader strategy are having the intended impact,” she said.

While the exact terms weren’t disclosed, it was less than 2 percent of the total contract. “You can really see what you’re paying,” Wright said.

A matter of trust

Many corporations with a net-zero commitment plan to buy credits tied to durable carbon removal projects to offset residual greenhouse gas emissions they can’t cut with real-world changes to industrial processes. 

Companies will need to fund at least 6 billion metric tons of removal annually by 2050 to make those goals, predicts Boston Consulting Group (BCG). Actual purchase volumes are much smaller, just 4.5 megatons in 2023, estimates CDR.fyi.

There are many reasons buyers are reluctant to buy into carbon removal, starting with the relative immaturity and cost of nascent approaches. Another big hurdle: a lack of trust in the traditional process by which carbon credits are measured, reported and verified.

“In a survey we did of more than 100 CDR buyers, buyers told us that permanence of carbon removal as well as good MRV were the two most important considerations when they were assessing quality,” said Karan Mistry, managing director and partner at BCG. “Additionally, buyers want to be certain that when they purchase carbon removal credits, that amount of carbon has been removed from the atmosphere in a verifiable way both so that they can ensure impact, and to reduce risk of making false claims.” 

Isometric is working on verification protocols for 13 carbon removal suppliers working on nascent approaches for biomass with carbon removal and storage, direct air capture, direct ocean capture, electrolytic marine carbon dioxide removal, enhanced rock weathering and ocean alkalinity enhancement. So far, it has verified credits for Charm, which also publishes its own verification information, and Vaulted Deep, which offers a similar carbon removal process.

Traditional registry organizations including Carbon Standards International, Gold Standard and Verra are also working on methodologies for verifying durable carbon removal approaches. Another newer player is Puro.earth. Here’s an overview of 35 methodologies tracked by CDR.fyi as of May.