(RTTNews) – JPMorgan Chase(JPM) on Tuesday announced its commitment to invest over $200 million in a mix of carbon removal technologies.
In a statement, the company announced that the allocated funds will be used for long-term agreements focused on removing and storing approximately 800,000 metric tons of carbon dioxide from the atmosphere.
The company had initially disclosed a commitment of $75 million out of the total $200 million in April. During that announcement, it stated its collaboration with Frontier, a benefits company owned by Stripe, which makes commitments on behalf of its member companies such as Alphabet, McKinsey, Meta, and Shopify.
According to JPMorgan, the investment in carbon removal and the establishment of long-term contracts with carbon removal companies serve two purposes. Firstly, it supports the emerging carbon removal industry, which is still in its early stages. Secondly, it allows the bank to offset the carbon emissions that are otherwise difficult to remove directly from its operations by 2030.
In a written statement, Daniel Pinto, President and Chief Operating Officer of JPM, emphasized the importance of providing capital and expertise to support promising technologies that can accelerate the transition to a low-carbon future. The company is committed to promoting the widespread adoption and advancement of carbon removal and storage technologies, signalling its strong support for these solutions in the market.
Although the carbon removal market is currently limited in size, the U.N. Intergovernmental Panel on Climate Change has forecasted that by 2050, there will be a need to remove approximately 10 gigatons of carbon dioxide annually to address the global climate challenge.
JPMorgan has entered into a nine-year agreement worth $20 million with Climeworks, a Swiss company specializing in direct air capture technology. As part of the agreement, Climeworks will work to remove the equivalent of 25,000 metric tons of carbon dioxide from the atmosphere. Direct air capture is a process that involves extracting carbon dioxide directly from the air, and Climeworks is recognized as a leading player in this field.
Christoph Gebald, co-founder and co-CEO of Climeworks, expressed his appreciation for the finance industry’s role in driving the expansion of effective carbon removal solutions. He referred to the agreement with JPMorgan as a significant milestone in the field of carbon removal.
In addition, the company entered into a partnership with Charm Industrial, a carbon storage company specializing in converting surplus organic material, such as corn stover, into bio-oil and storing it in disused oil wells. This innovative process prevents the decay of organic material, which would otherwise release carbon dioxide into the atmosphere.
The agreement with Charm Industrial aims to remove and store approximately 28,500 metric tons of carbon dioxide over a period of five years. The company confirmed that it has already commenced receiving carbon removal and storage deliveries from Charm Industrial.