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Denmark Made Largest Government CDR Purchase of Almost $24 Million

Denmark has made history with the largest government procurement of durable carbon dioxide removal (CDR), totaling almost $24 million (Dkr 166 million). The Danish Energy Agency has awarded contracts to three companies for new CCS (CO2 Capture and Storage) projects, marking the completion of the fund for negative emissions (NECCS fund). 

These projects will ensure the capture and storage of 160,350 tonnes of CO2 annually from 2026 to 2032. This is equivalent to the CO2 absorption of around 16,000 hectares of forest per year.

Denmark’s Carbon Capture Coup

The agreement, the second-largest of its kind globally, involves purchasing 1.1 million tons of durable carbon removal from three companies: BioCirc, Bioman ApS, and Carbon Capture Scotland. The largest CDR deal is between Microsoft and Ørsted, involving the purchase of 2.76 million metric tons of removal credits. 

BioCirc CO2 ApS and Bioman ApS have secured contracts for CO2 capture and storage, while Carbon Capture Scotland Limited is expected to finalize its contract soon. 

The successful bidding process indicates market interest in capturing and storing biogenic CO2 from biomass.

All three projects meet tender requirements and demonstrate the capacity for CO2 capture, transport, and storage. They are expected to advance and mature the CCS value chain in Denmark, with plans to store CO2 locally.

Each project has different support levels and will capture varying amounts of CO2. Together, they will capture and store 160,350 tonnes of biogenic CO2 annually starting from 2026 until the end of the contract period in 2032. Support will be provided upon confirmation of permanent underground storage of the captured CO2.

The NECCS fund, established as part of the Danish Financial Act of 2022, is designed to support negative emissions via CCS technology. Unlike capturing and storing fossil CO2, which merely reduces emissions, capturing and storing biogenic CO2 from sources like biomass results in negative emissions. 

That’s because the CO2 was originally absorbed from the air by plants, effectively removing CO2 from the atmosphere and storing it underground.

The fund aims to facilitate the capture and storage of biogenic CO2, thus contributing to overall CO2 reduction efforts. While three contracts have been awarded from the NECCS fund, not all allocated funds have been used. There are also currently no plans for further bidding rounds.

Danish Decarbonization Drive Toward Net Zero 

This move is part of Denmark’s net zero strategies, which originally aimed at reaching net zero emissions by 2050. But the new Danish government set forth ambitious climate change targets. It has set a world-leading goal of a 70% emission reduction by 2030 and net zero by 2045.

Additionally, they plan to reduce CO2 emissions nationally by 110% by 2050, surpassing 1990 levels and reaching a negative emission rate. The Danish Parliament also decided to phase out oil and gas extraction in the North Sea by 2050.

To support these objectives, the government intends to implement an emission levy on the agriculture sector and impose a tax on air travel, similar to measures adopted in Germany and Sweden.

Denmark has seen a consistent decline in greenhouse gas (GHG) emissions, with the electricity generation sector leading the way. The sector has reduced its emissions by ⅔ between 1990 and 2019, largely due to the increased use of renewables. This has resulted in Denmark having one of the lowest emission intensities among OECD countries. 

Denmark emissions intensity among OECD

Over the past decade, Denmark has also reduced its energy intensity by a quarter, indicating a shift towards a more energy-efficient economy. Renewable energy sources, particularly biofuels, and wind power, play a significant role in Denmark’s energy mix. It contributes to its relatively high share of the total energy supply from renewables.

Despite these achievements, Denmark still faces challenges related to demand-based emissions. While production-based emissions have consistently declined over the past fifteen years, demand-based emissions remain significant.

However, Denmark’s efforts to reduce its energy intensity and increase renewable energy use demonstrate its commitment to transitioning towards net zero. 

Denmark’s Roadmap to Net Zero 

According to BCG’s new decarbonization roadmap for the Nordic nations, Denmark can reach its net zero goal through this pathway:

Denmark pathway to net zero BCG

To achieve its climate targets, Denmark must address four challenging sectors:

  • Public electricity and heat production must transition to fossil-free sources.
  • The transport sector needs to adopt greener practices.
  • Agriculture must strive to become carbon neutral.
  • The industry sector must work towards becoming emission-free.

Denmark's decarbonization pathway 2020-2050

CCS technology can help Denmark’s industrial sector in reducing carbon emissions, which can contribute to a 34% reduction in the country’s total emissions. Other measures include enhancing fuel efficiency in engines, optimizing processes, and reducing energy consumption from equipment.

Moreover, using bio-based materials has the potential to abate 0.8 Mt CO2e emissions by 2050. Notably, implementing carbon capture and storage for about 50% of cement emissions are crucial steps toward achieving Denmark’s climate goals.

The NECCS announcement coincides with recent agreements among 5 northern European countries for the transport and storage of CO2 in the North Sea. Denmark’s proactive approach to carbon reduction includes previous agreements with Belgium, the Netherlands, and France to facilitate cross-border CO2 transport and storage.

All these initiatives are part of the Danish government’s CCS plan to ramp up the process for capture and storage. Under this proposed plan, Denmark earmarked EUR 3.6B (Dkr 27B) for CCUS tenders. 

Denmark is charting an impressive course towards achieving net zero emissions through a combination of innovation, investment, and collaboration. With groundbreaking carbon capture projects like the NECCS fund and ambitious climate targets, Denmark is largely contributing to the global effort of combatting climate change. 

The post Denmark Made Largest Government CDR Purchase of Almost $24 Million appeared first on Carbon Credits.

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The Strategic Case for Nature-Based Carbon Investments

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Nature-based carbon investments deserve consideration when they address a specific business dependency and produce outcomes you can measure. Imagine Moonbucks, a global coffee roaster planning next season’s espresso blend. It is considering natural Grade 4 coffee from Jimma, in southwestern Oromia, Ethiopia. Its sourcing decisions affect the roasting schedule and the cash tied up in coffee purchases. Moonbucks needs to understand which measures could protect that supply, what they would cost and how it would judge the results.

1. Define the sourcing problem before choosing a project

Moonbucks needs a dependable component for its espresso blend. Its procurement team wants continuity of volume and an agreed cup profile. Replacing a shipment at short notice could require new sample approval and changes to the blend, and given the schedules for cultivation, processing, and freight delivery, is practically impossible. Moonbucks needs to get this right, and its initial concern is inconsistent deliveries. It commissions an assessment of the supplying farms and post-harvest chain. The questions cover land condition, harvest availability and whether drying or storage problems are affecting saleable lots.

This distinction changes the investment brief. A tree-planting proposal cannot be assumed to fix drying problems. Better storage cannot restore eroded land. The team must establish which problem exists before selecting the response.

CCC’s guide to finding nature-based solutions in your supply chain explains where to look. Here, the next task is to turn a broad concern into a testable proposal.

2. Develop nature-based carbon investments around the actual supply chain

The assessment would trace Moonbucks’ purchases back through the exporter and supplying producer groups. Which farms supply the contracted lots? Who controls land-management decisions? How long does the buyer expect to maintain the purchasing relationship?

Furthermore, Jimma natural Grade 4 cannot be treated as interchangeable with every Ethiopian coffee. Moonbucks would need to test any substitute against its own blend and quality requirements.

Suppose Moonbucks’ assessment identifies an opportunity to maintain shade trees and restore vegetation along exposed streambanks. The IPCC describes agroforestry as a way to store carbon in vegetation and soil, with potential benefits for erosion control and water quality.1 Moonbucks would need local advice on species, growing conditions and maintenance before deciding how these measures fit its sourcing plan.

The proposal now has a defined sourcing connection and a candidate intervention. The next steps are to test its effect on production, assess carbon eligibility and build the financial case.

3. Compare the proposal with other ways to protect supply

WBCSD’s Nature-based Solutions Blueprint recommends comparing nature-based options with other responses across their benefits and costs.2 For Moonbucks, that means evaluating the landscape proposal alongside drying improvements, storage controls and alternative sourcing arrangements.

The product’s natural-process designation matters. Moonbucks should examine the drying and dry-milling chain alongside land conditions. Its team would check storage practices, contamination risks and incoming-lot quality to see whether problems arise before or after the coffee leaves the farms.

The revised proposal might combine land stewardship with separate post-harvest controls. Each component needs its own purpose and budget. A sustainability label should not obscure which activity is expected to solve which problem.

The project develops as the evidence improves. Its scope should follow the diagnosis rather than preserve the first idea unchanged.

4. Establish what the carbon outcome could count toward

Moonbucks’ sustainability team now tests the proposed carbon case separately from the sourcing case. Is the objective a measurable change in Moonbucks’ value-chain emissions, verified credits for separate voluntary use, or distinct outcomes under carefully defined arrangements?

Scope 3 covers value-chain emissions. A purchasing relationship alone does not prove that a farm intervention can be included in Moonbucks’ inventory. The team needs an applicable accounting method, defensible boundaries and evidence supporting attribution.

SBTi’s FLAG Guidance (forest, land and agriculture), version 1.2, says purchased credits used as offsets cannot meet near-term FLAG or energy and industry targets. Eligible land-based removals are subject to accounting requirements.3 Moonbucks needs to test its proposal against those rules before including an outcome in its targets.

For Moonbucks’ Jimma proposal, maintaining existing trees and establishing new vegetation could involve different carbon questions. Specialists must examine the baseline and additionality, meaning what changes because the project proceeds. They must also assess measurement and the risk that stored carbon is lost. CCC’s MRV and additionality article introduces those tests.

Until that work is complete, Moonbucks should not budget an assumed Scope 3 reduction or credit-sale receipt. Direct emissions reductions remain the priority.

5. Build a financial case that survives weaker assumptions

Moonbucks’ finance team would now build a multi-year budget. UNEP’s State of Finance for Nature 2023 compares current finance with the investment needed to meet climate, biodiversity and land-restoration goals.4 The company would cost its proposed activities, farmer participation and ongoing monitoring. Verification, where required, is a separate expense. Maintenance and responsibility for replacing failed plantings must remain visible after the initial establishment budget ends.

Operational benefits need equally careful treatment. If fewer rejected lots reduce emergency purchasing, count that saving once. Do not add “supply resilience” as another financial benefit when it represents the same avoided cost.

Moonbucks should compare a base case with slower benefits, higher implementation costs and no carbon revenue. It should also distinguish production outcomes from quality and shipment outcomes. A single good harvest would not prove that the landscape intervention caused better delivery performance.

A project can remain worth funding even when its carbon case needs more work. That decision must rest on the operational evidence and the company’s objectives, without unsupported environmental claims.

6. Fund a pilot with a clear expansion decision

Moonbucks’ first approval would fund a bounded pilot, rather than commit the entire sourcing program. Before spending, Moonbucks would agree on participating farms, responsibilities and the evidence needed at review.

Its scorecard could track farmer participation, implementation costs and plant survival, alongside accepted coffee volumes and lot-quality results. Carbon measurements would follow the selected method. Farm-level traceability must connect the intervention to the actual sourcing relationship.

Suppose Moonbucks’ review later finds that storage changes explain most quality improvements, while the land measures need longer observation. Those findings would shape the next decision: expand the proven component, adjust the landscape work or pause further spending. They would not justify crediting all improvements to tree planting.

This gives nature-based carbon investments a practical place in a multi-year strategy. Funding increases as the evidence supports it, and the project can change direction before a larger commitment.

Discuss a sourcing opportunity with CCC

Carbon Credit Capital’s nature-based supply-chain investment service uses its Dual-Value Model to examine supply-chain economics alongside potential sustainability outcomes.

Schedule a consultation to discuss your sourcing exposure and the questions to resolve before allocating capital.

Sources

  1. Intergovernmental Panel on Climate Change (IPCC), Climate Change 2022: Mitigation of Climate Change, Chapter 7, Agriculture, Forestry and Other Land Uses, section 7.4.3.3 (Agroforestry).
  2. World Business Council for Sustainable Development (WBCSD), Nature-based Solutions Blueprint, 5 June 2024.
  3. Science Based Targets initiative (SBTi), Forest, Land and Agriculture Science-Based Target-Setting Guidance, version 1.2, March 2026, section 3.1.4, pp. 37–38.
  4. United Nations Environment Programme (UNEP), State of Finance for Nature 2023, 2023.
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Carbon Footprint

How to buy plastic credits, and what to check before you do

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A plastic credit funds the collection of plastic waste in places where no formal system exists to collect it. Each credit represents a measured, independently audited quantity of plastic taken out of the environment or returned to use, tracked on a public registry.

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Carbon Footprint

EU carbon credit claims after 27 September 2026

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EU carbon credit claims changed on 27 September 2026, the day the Directive (EU) 2024/825 began to apply across the European Union. The change is narrow. It changes how a company can talk about the credits it buys. A product can no longer be called neutral on the strength of compensation alone; however, every specific, evidenced statement about what a company measured, reduced, and funded stays fully available.

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