Negative emissions contribute to achieving the climate goals

To limit global warming in line with the Paris Agreement, we must vigorously and swiftly reduce greenhouse gas emissions. This is the foundation for success, but there are emissions that are difficult or almost impossible to eliminate. For example, emissions of nitrogen oxides released in agriculture or the fossil raw material in some industrial processes, such as certain chemicals in pharmaceutical production. These emissions are classified as so-called residual emissions, and for the world to achieve climate neutrality, they need to be counteracted through permanent negative emissions – meaning the removal of the same amount of carbon dioxide from the atmosphere.

Permanent negative emissions are a tool that stakeholders who look to neutralize their hard-to-abate emissions can use to achieve net-zero emissions.

Image above: The market for permanent negative emissions.


Negative emissions will be offered on the energy market and on a voluntary market

Once Stockholm Exergi has established a large-scale BECCS (Bio-Energy Carbon Capture and Storage) facility, we will capture and store biogenic carbon dioxide, thus being able to offer permanent negative emissions. Similar to how we currently sell district heating and district cooling, in the future, we would like to offer negative emissions to our current energy customers and new customers on a voluntary market that is separate from our district heating market. The permanent negative emissions will be sold both in combination with district heating and as a stand-alone product that can be purchased on an international voluntary market in the form of Carbon Removal Certificates (CRCs). Each CRC represents one ton of carbon dioxide removed from the atmosphere.

Negative emissions are for those who want to ensure their contribution to fulfilling the Paris Agreement

Stockholm Exergi’s offer of permanent negative emissions is primarily aimed at companies that have set ambitious climate goals for their operations. These goals are usually in line with the Science Based Targets Initiative (SBTi) – a method for companies to ensure a scientific approach to their climate goals, in line with the Paris Agreement. With the help of SBTi, companies establish both short- and long-term goals for reducing their emissions, but also for a gradual implementation of permanent negative emissions – to ultimately achieve Net Zero. The idea is not to use permanent negative emissions as a solution to continue emitting carbon dioxide, but rather to use them in combination with emission reductions to neutralize the residual emissions. This emission residual does not necessarily constitute only a company’s own direct emissions. The residual emissions can also include the carbon footprint from purchased energy or services within the company’s operations, or other services in the value chain – i.e., indirect emissions from the company’s suppliers and customers.

An entity purchasing negative emissions neutralize emissions in its value chain

The buyer of permanent negative emissions is the one also entitled to claim them. This means that Stockholm Exergi will not be claiming permanent negative emissions that we have sold as CRCs.

Thus, it is the customers paying for the CRC that will record and use them to neutralize their residual emissions, regardless of where in the world their customers are located. Only one stakeholder can claim each CRC; however, the permanent negative emissions can simultaneously be aggregated by the Swedish nation when calculating how much negative emissions have been produced inside the country’s borders, for national accounting and reporting to the UN, on the condition that it is not counted by another nation.

The market for negative emissions must be international

According to Article 6 of the Paris Agreement, it is central to the climate transition that a framework for cross-border emissions trading is put in place. This would enable countries to cooperate and reduce global emissions in the most cost-effective way.

Alongside emissions trading between nations, the trade in permanent negative emissions directly between companies will take place. This parallel commerce in two separate markets – one for nations and one for companies – enables countries and companies to collectively combat climate change. By allowing both private financing and public financing, the economic resources allocated to permanent negative emissions can be maximized, benefitting the climate as much as possible. If the negative emissions are traded on a compliance market, i.e. not on a voluntary market, then the right of a nation to usem towards its climate targets must be transferred to the country in which the buying company operates

Negative emissions are a potential export product

The Swedish nation has favorable conditions for Bio-Energy Carbon Capture and Storage. Therefore permanent negative emissions have the potential to become a new Swedish export industry. The total potential is approximately 30 million tons, which is well over the 10 million tons of carbon dioxide expected to be needed to reach Sweden’s climate target. With the support of Article 6 of the Paris Agreement, Sweden can produce and export up to 20 million tons of permanent negative emissions per year to countries that need to counteract their hard-to-reduce emissions with negative emissions but lack Sweden’s favorable conditions to produce them. The benefit for Sweden is increased export of a service much-needed in the climate transition.