x
LATEST ARTICLE Unlock a green future through sustainable impact investing Read Article

Stripe's bold $1 billion carbon commitment sparks green revolution

Stripe's initial $1 million investment in carbon removal in 2020 has evolved into a $1 billion initiative. The fintech giant, which facilitated $1 trillion in transactions in 2023, has rallied approximately 300 companies to pledge substantial funds for carbon removal credits. Spearheading this initiative is Nan Ransohoff, who drew inspiration from the pharmaceutical industry to provide future buying signals for carbon removal researchers.

Stripes bold $1 billion carbon commitment sparks green revolution_Aerial view of newly planted forest_visual 1Aerial view of newly planted forest. AI generated picture.

Ransohoff, alongside a dedicated team at Stripe, manages Frontier, a $1 billion fund supporting early-stage carbon removal projects. Frontier has secured backing from major corporations like Alphabet, Meta, McKinsey, and Shopify, with additional funding from JP Morgan, Salesforce, and Watershed. Stripe's customers also contribute by allocating 1% of their transaction revenue, adding tens of millions more to the initiative.

Frontier employs an ‘advance market commitment’ model, securing pre-purchase contracts with startups that deliver verified carbon removal credits. This approach assures investors of a market for emerging technologies. To date, Frontier has signed nearly $320 million in contracts, facilitating the removal of over 571,000 metric tonnes of carbon dioxide.

Read more: CSRD Essentials: simplifying EU sustainability reporting

The team focuses on durable and scalable carbon removal methods, prioritising technologies that promise long-term storage and cost reductions. Currently, the cost of carbon removal remains high, but Frontier's strategic investments aim to drive down prices. For instance, costs with Charm Industrial, a biomass-to-bio-oil company, have the potential to decrease by 75% by 2030.

While some funded projects have successfully delivered carbon credits, not all ventures will succeed. However, the risk is mitigated by contracts that only pay for verified removals. The broader carbon removal market is gaining momentum, with similar initiatives like NextGen and significant corporate buyers like Microsoft pushing forward.

Read more: Aligning with CSRD: the smart move for future-proofing your business

Stripe's Frontier is expected to operate until 2030, by which time the market should be self-sustaining. To further accelerate growth, Stripe helped establish the Carbon Removal Alliance in 2023 and is expanding its fellowship programme to foster demand-side policies and innovations.

Ransohoff emphasises the importance of a comprehensive demand-side strategy, stating, ‘At the end of the day, we have to sort out what we think it’s important so that the world thinks about how to place enough benefits now.’

We invite you to explore DGB Group’s transformative nature-based projects, offering compelling opportunities for your business or investment portfolio. Our initiatives deliver numerous benefits, including biodiversity enhancement, ecosystem restoration, and community development. As global sustainability and environmental accountability become paramount, DGB provides solutions to measure and compensate for your carbon footprint with verified carbon units. Addressing your carbon footprint aligns you with global standards such as the CSRD, supports crucial initiatives, and positively impacts the environment.

Discover our nature-based solutions

Before you go...

As DGB Group, our sole purpose is to rebuild trust and serve the public by making the right information available to everyone. By subscribing to our mailing newsletter, you can get the latest tips and trends from DGB Group's expert team in your inbox. Sign up now and never miss the insights.

Read other news

The price of Australian Carbon Credit Units (ACCUs) is projected to surge by 75% to AUD 70 per tonne..

The European Commission’s 2024 NextGenerationEU (NGEU) Green Bonds Allocation and Impact Report shed..

At COP29 in Baku, Norway unveiled its largest financial commitment yet to the global carbon market: ..

In a landmark collaboration unveiled during COP29 in Baku, Azerbaijan, Verra and the state of Amazon..

Let’s get to know you

Let's talk about how we can create value together for your sustainability journey.