Climeworks and Swiss Re sign DAC purchase agreement

Aug 26 2021


Swiss Re has signed the world’s first 10-year carbon removal purchase agreement with direct air capture and storage worth 10 million USD.

Climeworks and Swiss Re have committed to a strategic partnership. The collaboration will include developing risk management knowledge and risk transfer solutions, as well as to explore future investment and project finance opportunities.  This is the first such partnership in the voluntary carbon market for carbon removal and is a unique lever to support the development of the direct air capture and storage industry, the company said.

Swiss Re committed in 2019 to reach net-zero operational emissions by 2030 by reducing their carbon footprint and removing any residual emissions. The partnership with Swiss Re is of integral importance to Climeworks: the re/insurance industry is at the forefront of assessing complex risk structures including those of climate change. Re/insurers are capable of structuring those risks and allocating them in an efficient way. Swiss Re’s unique long-term commitment sends once again a strong signal emphasizing that a pure and unfiltered climate solution like Climeworks’ technology is important to reach the Paris Agreement climate targets.

Christian Mumenthaler, Swiss Re's Group CEO and Co-Chair of the World Economic Forum's Alliance of CEO Climate Leaders, said, "To mitigate the risks of climate change, the world needs to scale-up carbon removal on top of, not instead of emission reductions. By partnering with Climeworks we can play to our strengths in this endeavour, as a risk taker, investor, and forward-looking buyer of climate solutions.”

This commitment is by its nature providing a structure for interested buyers to enter into similar purchase agreements with Climeworks. Swiss Re is sending a key demand signal to carbon removal solution providers and investors. Pioneering customers like Swiss Re and their long-term commitment prove that a market for measurable and permanent carbon dioxide removals already exists today and will grow significantly in the future.  Bringing climate solutions to scale not only requires the right demand signals, but also de-risking and financing. This is why the partnership between Swiss Re and Climeworks goes beyond the pioneering 10-year carbon removal purchase agreement with further joint activities being assessed together.

Powered solely by renewable energy, Climeworks’ direct air capture plants capture CO2 from the air. In Iceland, Climeworks’ partner Carbfix mixes the CO2 with water and pumps it deep underground where it reacts with the basaltic rock formations and mineralizes: the CO2 literally turns into stone. Climeworks’ technology is scalable and does not compete with arable land. This September, Climeworks is going to launch its new large-scale direct air capture and storage plant “Orca” in Iceland, bringing large-scale direct air capture technology to reality. 

 

Climeworks
Swiss Re


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Issue 82 - July - Aug 2021

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