Oct 25, 2019

BP looks to enable carbon offsetting for businesses

Marcus Lawrence
3 min
Finite Carbon aims to incentivise enterprises to invest in carbon offset forests by offering quantified financial rewards per tonne of carbon stored
As Big Oil diversifies in the face of renewable energy’s ascendant prominence and legislative moves towards net zero industries,

As Big Oil diversifies in the face of renewable energy’s ascendant prominence and legislative moves towards net zero industries, BP has been investing in various initiatives and firms seeking to accelerate the adoption of sustainable alternatives and limit environmental impacts.

The latest move from BP Ventures is a US$5mn investment in Finite Resources, the parent of Finite Carbon – a firm based in the US focused on managing carbon through forestry. BP’s press release said the funds will go towards a new line of business aimed at incentivising business-financed forest management for carbon offsetting purposes. 

Finite Carbon, which celebrated its 10th anniversary this year, is North America’s largest manager of forest carbon offsets with 40 forest projects across almost 3mn acres. By promising financial rewards for positive carbon outcomes, Finite Carbon aims to support the plans laid out in the Paris Climate Agreement to both increase forest coverage and reduce emissions relative to deforestation and forest degradation.

The company quantifies carbon benefit for long-term commitments to its forestry strategy through a fee-per-tonne scheme that measures carbon stored permanently by trees. The benefits go deeper, with stronger woodland ecosystems reducing the likelihood of wildfires and providing the local environment with cleaner air and water, supporting biodiversity and offering recreational opportunities for local communities. 

“Just as a price on carbon incentivizes the transition to low carbon energy production, it also incentivizes the sustainable management of American forests,” said Sean Carney, Chief Executive of Finite Carbon, in BP’s press release.  

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“When businesses choose to buy forest carbon offsets, it means landowners are being paid to practice good forest management, which isn’t as easy or as profitable as the alternative. These changes aren’t just good for the planet – they’re good for the people who fish in, swim in, and drink the water that flows through these forests.
 
“With BP’s investment in Finite Resources, we plan to significantly scale the use of voluntary offsets as a mechanism to incentivize forest stewardship. With the help of those businesses committed to supporting good forest management, we expect to deliver more than $100 million directly to landowners in the next five years.”

Nacho Gimenez, Managing Director of BP Ventures, added: “The conservation and restoration of forests is vital to combatting climate change. BP has supported Finite Carbon’s project developments and purchased many of their offsets for regulatory compliance for a number of years. 

“Now we look forward to supporting the team’s expansion into the voluntary carbon market as it connects businesses that are willing to offset their carbon footprint with landowners willing to adopt forest management practices that maintain and increase carbon storage.”

In line with BP's sustainable investment strategy, BP Ventures invested in FreeWire earlier this year, a company focused on enabling EV adoption through mobile EV charging infrastructural solutions. I caught up with FreeWire CEO, Arcady Sosinov to find out more, and you can read the piece here.

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Apr 23, 2021

Drax advances biomass strategy with Pinnacle acquisition

Drax
Biomass
Sustainability
BECCS
Dominic Ellis
2 min
Drax is advancing biomass following Pinnacle acquisition it reported in a trading update

Drax' recently completed acquisition of Pinnacle more than doubles its sustainable biomass production capacity and significantly reduces its cost of production, it reported in a trading update.

The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.

The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).

Drax CEO Will Gardiner said its Q1 performance had been "robust", supported by the sale of Drax Generation Enterprise, which holds four CCGT power stations, to VPI Generation.

This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.

In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.

The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.

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