The latest report by the IPCC, released on 4^th April, reconfirms that carbon dioxide removal is essential to limit global warming to 1.5°C. In addition to drastic emissions reductions, carbon removal solutions need to be deployed at scale to remove historic and residual CO₂ emissions to reach net-zero emissions by 2050, and eventually net-negative emissions.

Climeworks has announced that it has signed an equity round of CHF 600 million (USD 650 million), which marks a major milestone in the history of Climeworks and an even bigger step for the carbon removal industry.

The financing is co-led by Partners Group (acting on behalf of its clients) and GIC, with further participation from (in alphabetical order) Baillie Gifford, Carbon Removal Partners, Global Founders Capital, John Doerr, M&G, Swiss Re, as well as other new and existing shareholders including long-term investor and anchor shareholder BigPoint Holding AG. J.P. Morgan Securities LLC served as sole placement agent for Climeworks in connection with the transaction.

Since its foundation in 2009, Climeworks has pioneered direct air capture technology and is the most advanced industry player, with the world’s largest direct air capture and storage plant launched in September 2021. The new investor base includes several of the most renowned and largest institutional technology and infrastructure investors globally.

The funding will unlock the next phase of Climeworks’ growth, scaling direct air capture up to multi-million-ton capacity and implementing large-scale facilities as carbon removal becomes a trillion-dollar market.

Christoph Gebald, co-founder and co-CEO of Climeworks:

“We are proud to partner with our new investors and thankful for the renewed trust of our existing ones, all committed to the long-term journey of Climeworks. It is thrilling to see the appetite and support of globally leading investors towards the scale up of our technology; this is a great milestone for our company as well as the entire industry.”

Jan Wurzbacher, co-founder and co-CEO of Climeworks:

“We founded Climeworks with the vision to provide the world a tech that has the potential to reverse climate change. Accelerating the scale up of carbon removal capacity will play a crucial role in global efforts to keep global warming under 1.5°C, positively impacting the lives of billions of people. And this is what we will do starting now.”

Alex Seddon, Head of Catalyst Team, M&G:

We are excited to be investing in Climeworks, a company that we believe is the leading independent operator in the direct air capture sector. Emissions removal is an essential complement to emissions reduction, and this technology has the potential to provide the requisite scale to meaningfully contribute to achieving the Paris Agreement goals.”

Alfred Gantner, Co-Founder and Executive Member of the Board of Directors, Partners Group:

“Climeworks’ DAC plants are part of a portfolio of carbon removal technologies that are essential to achieving the Paris Agreement goals. The scalability of Climeworks’ technology makes it ideally suited to our transformational investing strategy and positions the Company to make a significant contribution to global carbon removal efforts. We are also attracted to Climeworks due to its close fit with our commitment to achieving lasting, positive stakeholder impact.”

Lee Qian, Investment Manager, Baillie Gifford:

“Whilst there is no silver bullet for addressing climate change, Climeworks’ direct air capture technology has the potential to play an important role in helping the world avoid its worst impacts. There will be many hurdles to overcome, but the scale of the opportunity is huge. We have been very impressed by Climeworks’ management team and are excited to support them on the journey ahead.”

Maximilian Zeller, Founding & Managing Partner, Carbon Removal Partners

“Climeworks is an absolute pioneer in direct air capture (DAC) and more broadly the whole carbon removal industry. While developing the first scalable DAC technology, it has catalyzed the world’s imagination of gigaton-scale carbon removal. Further, it has been tirelessly educating and inspiring the world about this pivotal industry. We are proud to support Climeworks in its journey to fight for change.”

Choo Yong Cheen, Chief Investment Officer of Private Equity, GIC:

“Climeworks is the global pioneer and leader in direct air capture (DAC) technology. We believe that DAC technology will play a crucial role in decarbonisation globally, and that Climeworks will lead this transformation. As a long-term global investor, we look forward to supporting Climeworks’ proven leadership team, as they deliver on their roadmap to scale their DAC capabilities and meet the already-outsized demand for their product.” 

About Climeworks

Climeworks empowers people to reverse climate change by permanently removing carbon dioxide from the air. One of two things happens to the Climeworks air-captured carbon dioxide: either it is returned to earth, stored safely and permanently away for millions of years, or it is upcycled into climate-friendly products such as carbon-neutral fuels and materials.

The Climeworks direct air capture technology runs exclusively on clean energy, and the modular CO₂ collectors can be stacked to build machines of any size.

In September 2021, Climeworks launched the world’s largest direct air capture and storage plant, Orca, located in Iceland. Founded by engineers Christoph Gebald and Jan Wurzbacher, Climeworks strives to inspire 1 billion people to act now and remove carbon dioxide from the air.

https://climeworks.com

First of its kind survey of businesses from UN-backed SME Climate Hub shows that small to medium-sized businesses (SMEs) need additional resources and guidance to reduce carbon emissions.

• New survey reveals half of small businesses calculate emissions, and 60% have plans to reduce carbon impact. However, two-thirds of small business owners worried they don’t have the right skills and knowledge to tackle the climate crisis.
• Top reasons small businesses cite for delaying climate action include a lack of skills and knowledge (63%), funding (48%) and time (40%).
• Approximately 70% of SMEs need access to external funds to reduce their emissions faster or at all. However, only one-third of SMEs have been offered a financial incentive to reduce emissions.
• SMEs make up 90% of business worldwide and affect the livelihoods of over 2 billion people. The SME Climate Hub has created new resources to address barriers to action, empowering these businesses to reach net zero.

The SME Climate Hub – the UN-backed initiative that helps small and medium-sized businesses take robust climate action and join the United Nations Race to Zero – conducted a survey to explore the barriers preventing SMEs from reducing their carbon emissions. The SME Climate Hub conducted the survey on 194 of their member businesses, representing a sample of companies around the world, and across sectors, size, and income.

The survey found that small businesses are stepping up in the fight against climate change, but lacked the resources needed to invest fully in their climate journey. 8 out of 10 participants consider reducing emissions “a high priority,” with businesses making efforts to cut their greenhouse gas emissions through reductions to energy consumption and waste (82%), employee education (64%), and upgrades to facilities and equipment (52%). However, only 60% of the SMEs in this category had a long-term emission reduction plan in place, highlighting the importance of short term actions and the need for increased planning amongst these first movers.

Taking climate action leads to more resilient businesses – and SMEs reveal their growing understanding of its benefits. Small businesses are prioritizing climate action to enhance the reputation of their brand (73%); differentiate their business from competitors (61%); and meet customer expectations (42%). However, at 96%, SMEs overwhelmingly cited “the right thing to do” as a key motivation for taking climate action.

Even small businesses aware of their environmental impact and the benefits of carbon mitigation have often lacked the resources to take action. This adds another barrier for companies not yet involved in the conversation. The most commonly-cited barrier to action is a lack of skills and knowledge, denoted by 63% of surveyed businesses, and a gap actively addressed by the SME Climate Hub since the survey’s launch. This might include education around where and how to get started, a baseline understanding of the SME role in climate action, or the tools available to aid them in their journey.

The second most common barrier is funding, cited by nearly 50% of businesses. Concurrently, 69% of SMEs denote access to external funds as necessary to reduce their emissions faster or at all. Only one-third of SMEs have been offered a financial incentive to reduce emissions, with only 8% of SME owners having received support from their banks.

To meet global Paris Agreement targets and avert the most harmful consequences of climate change, it is vital that small to medium-sized businesses are empowered to reduce their carbon emissions. SMEs are usually classified as businesses with fewer than 500 employees. Though any single SME’s climate impact may seem small, the combined effect of the category is sizable; SMEs make up 90% of business worldwide. They are also an integral part of the supply chains of larger corporations, and make up a category called Scope 3 emissions.

“Taken on an individual scale, each small business has a relatively moderate carbon footprint,” said María Mendiluce, CEO of the We Mean Business Coalition, a founding partner of the SME Climate Hub. “However, together, these small businesses have a huge impact – both on the planet and on their communities. To limit the effects of climate change, and to create a just future that leaves no one behind, it’s imperative that every business, of every size, has the tools they need to prioritize climate action.”

Three tools to help SMEs start their reductions today

Through the SME Climate Hub, businesses committing to net zero can access tools and support to measure, report on, and reduce their emissions. Since the distribution of the survey, the initiative has addressed resource needs of the small business community, launching tools for education, skills development, and financial incentives, with additional tools being developed in the coming months.

With the Industry CO2 Insights tool developed by Normative, the SME Climate Hub helps businesses understand their baseline emissions through insights into the carbon footprint of businesses in the same industries and regions.

“The most important thing is to get started. Every organization is a part of the journey and every forward step matters, ” says Kristian Rönn, CEO and co-founder of Normative, the official software provider for the SME Climate Hub. “We need to start measuring our impact today, because in the end what gets measured gets managed,” Kristian Rönn concludes.

In November, the SME Climate Hub launched Climate Fit, a step by step resource developed by the University of Cambridge Institute for Sustainability Leadership (CISL) and Business for Social Responsibility to help small businesses learn practical skills to reduce their carbon emissions, covering topics of strategy and operations to governance and the supply chain.

To address the financing gap, the initiative alongside BSR and CISL has released a financial support guide ​​to improve access to financing for small and medium sized enterprises (SMEs) working to reduce their carbon emissions. The SME Climate Hub also now offers a reporting framework developed in collaboration with Normative, CDP, and the Exponential Roadmap Initiative, which is intended to be used by SMEs to guide their reporting of climate impacts and strategies to multiple stakeholders. The next iteration of the reporting tool will support direct reporting by SMEs.

“We created the SME Climate Hub as a resource that’s accessible to small businesses around the world to help them in their journey to reach net-zero by 2050 or sooner,” explains María Mendiluce.

“Our aim with the SME Climate Hub is to help millions of SMEs develop climate action plans – and to provide them with a commercial boost for doing so. We believe that the SME Climate Hub can play an important role in accelerating the race to a net-zero future,” says Johan Falk, co-founder of the SME Climate Hub and head of the Exponential Roadmap Initiative.

About the Survey Method 

The SME Climate Hub conducted the survey in July and August of 2021. The survey was distributed via email to small and medium sized businesses committed to the SME Climate Hub. There were 194 respondents in total.

About the SME Climate Hub

The SME Climate Hub is an initiative of the We Mean Business Coalition, the Exponential Roadmap Initiative, the United Nations Race to Zero campaign and the International Chamber of Commerce. In collaboration with Normative and the Net Zero team at Oxford University, the SME Climate Hub provides tools and resources to enable SMEs to make a climate commitment, take action and measure their progress towards emissions reductions.​ This partnership allows SMEs to join the United Nations Race to Zero campaign — an international campaign that brings together an unprecedented coalition of real economy actors and 120 governments committed to achieve net-zero emissions by no later than 2050.

About Normative

Normative is the world’s first carbon accounting engine, helping businesses calculate their entire climate footprint and reduce their greenhouse gas emissions. Co-founded in 2014 by Kristian Rönn to accelerate the transition to Net Zero, Normative sets a new standard in scientific accuracy for emissions accounting, powered by its market-leading emissions database. The company, headquartered in Stockholm, has hundreds of customers, and partners with leading climate change organisations including the UN, to deliver actionable sustainability intelligence. Normative is also the foundational software provider for the UK’s SME Climate Hub through which thousands of small businesses have committed to net zero. Normative.io

Ecoserv Group, the multi-discipline facilities management (FM) company, has teamed up with environmental consultancy RSK Group to support its journey to net zero. This will enable Ecoserv to determine its exact carbon footprint and establish science-based objectives as part of an ambitious sustainability strategy. As a result, the company has already committed to a 50% reduction in scope 1, 2 and assessed scope 3 emissions.

“We have already undertaken a Green House Gas (GHG) assessment with the aim of quantifying our emissions, while pinpointing carbon hotspots and carbon management potential,” explains Sally-Ann van Blerk, Group Sustainability & Brand Director at Ecoserv Group. “This is enabling us to set specific, measurable, achievable, realistic and timely (SMART) emission reduction targets and develop an effective strategy to achieve them, with a particular focus on our fleet operation, office energy usage and the impact of commuting.”

In particular, the assessment found that car and van business travel accounts for most of the scope 1 and 2 emissions, followed by office energy usage. Further investigation will be undertaken to measure the environmental impact of office-based and remote staff, but from the initial review it has been possible to create a Carbon Management Plan that identifies ways to manage and significantly reduce emissions.

The Carbon Management Plan has pinpointed some initial areas of improvement. By moving the current internal combustion engine (ICE) fleet to electric vehicles would cut an estimated ~110 tCO2e in the first year, with a 20% reduction in mileage through smarter mobility increasing the savings potential. Meanwhile a 10% average decrease in office energy use at Ecoserv’s Wallingford and Watford offices would save ~7 tCO2e a year. Other proposed actions include updating office equipment; implementing a water and wastewater initiative; and avoiding single use materials where possible.

The next step will be to encourage greener commuting to and from Ecoserv’s offices. It is estimated that a 10% reduction in GHG emissions from less commuting or a switch to lower-carbon transport (EV, e-bikes, public transport, foot) would see a significant scope 3 impact. One of the largest challenges will be to reduce emissions linked to the commuting activity of 1,500 cleaning operatives. The assessment found that just a 20% reduction could equate to a saving of ~110 tCO2e, so Ecoserv is exploring a wide range of schemes and incentives to encourage lower-carbon commuting methods.

Jean Henri Beukes, Chief Executive Officer at Ecoserv Group commented: “When it comes to fighting climate change urgent engagement is needed now, so this partnership with RSK is an important step in our journey to net zero. We have been eco-conscious since 1993 and our aim is to build on this legacy to lead the way in sustainability and help our customers achieve the change that is needed and needed urgently.”