Navigating EU Carbon Program & Carbon Removal Shifts

An analysis of the EU's bold reforms and the growing appeal of carbon removal technologies in the fight against climate change.

Author: Billy Richards

As we witness unprecedented global efforts towards achieving a sustainable future, the European Union (EU) is taking significant strides forward. The Union's recent overhaul of its main climate policy marks a pivotal moment in our fight against climate change. Not only is this an actionable and firm commitment, but it also better aligns the true cost of pollution with the cost of offsetting and other instruments. This overhaul will strengthen the incentive to adopt cleaner practices across all sectors, promoting increased liquidity for environmental instruments, such as carbon credits.

At Changeblock, a leading provider of environmental asset investment solutions, we stand firmly behind these reforms. Our mission has always been to enable and promote environmental asset investment through enhanced credit integrity, transparency, and trading functionality. By making pollution more expensive for key industries, including cement manufacturing, aviation, and shipping, the EU's reforms are expected to increase demand for new ways to fight pollution. It's a reality that heavy industries and airlines will require effective tools to achieve regulatory compliance in the face of losing their free CO2 permits.

The rising appeal of carbon removal technologies is another interesting facet of the current environmental landscape. According to a recent article by Roberto Bocca at the World Economic Forum, companies in a variety of sectors are investing heavily in carbon removal credits, betting on the development of the carbon capture industry. As demand for these credits grows, long-term carbon credit deals, backed by new government subsidies, are making these technologies increasingly attractive to investors.

At Changeblock, we have taken a risk-mitigating approach that enables us to facilitate portfolio management and risk-rated returns for investors in this evolving landscape. We are encouraged by the innovative mechanisms driving private wealth into climate investments, providing important liquidity for these instruments and reducing the hurdles for enterprises to adopt these tools.

Critics argue that carbon capture technologies could potentially allow oil and gas producers to avoid shifting to renewables. However, it is essential to remember that the transition to a net-zero economy will require a multitude of tools and strategies. Carbon capture technologies, when used responsibly and as part of a broader plan, can contribute meaningfully to our collective effort to mitigate climate change.

Our goal at Changeblock is to streamline the credit creation process and ensure high-integrity transactions. By doing so, we aim to play a crucial role in accelerating the transition to a global net-zero economy. As we move forward, we hope to see even more innovations, collaborations, and policies that push us closer to this goal. In this pivotal moment, every step we take towards a sustainable future is a step in the right direction.

About the author: Billy Richards is the CEO of Changeblock, a global carbon market technology company. A computational biochemist and entrepreneur, Richards is dedicated to driving changes in the financial ecosystem required to decelerate global warming and accelerate biodiversity.