Canada To Purchase At Least $7M In Carbon Removal Credits Through New Federal Program

The Government of Canada has announced a new Request for Standing Offer as part of its plan to invest at least $7 million (CAD $10 million) in carbon dioxide removal (CDR) credits.

With this move, Canada becomes the first national government to advance a dedicated carbon removal procurement program. The initiative will allow federal departments to purchase CDR credits as a tool for reducing net greenhouse gas emissions from government operations.

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Eligible CDR Pathways

Under the Request for Standing Offer, the Canadian government is accepting submissions from CO2 removal projects that meet specific technological requirements. Eligible pathways include Direct Air Carbon Dioxide Capture and Permanent Storage (DACCS), Bioenergy with Carbon Capture and Storage (BECCS), biochar, other Biomass Carbon Removal and Storage (BiCRS), and enhanced mineralization.

Each CDR stream will go through a separate competitive process. Submissions will be evaluated based on the highest combined rating of technical merit and price. To qualify, the CDR project and any associated CO2 storage activities must be located in Canada. The standing offer period will run from the award date through March 31, 2029.

Industry Response

The decision was met with enthusiasm from the broader carbon removal community, with stakeholders calling this the kind of demand signal the CDR sector has needed to grow and scale.

One of the key CDR industry voices active in Canada is the Carbon Business Council, a coalition of more than 100 organizations working globally to accelerate carbon removal market development. The Council also leads a Canada Working Group that brings together over 20 organizations engaged in or exploring CDR deployment across the country.

Relevant: New Policy Primer By Carbon Business Council Offers Pointers On Advancing CDR In Canada

What Stakeholders Are Saying

Ben Rubin, Executive Director of the Carbon Business Council and publisher of the Carbon Herald, commented on the government's call for bids:

"The Carbon Business Council is grateful to the Government of Canada for building demand for carbon removal with the launch of the procurement program. By purchasing high-integrity credits for carbon dioxide removal, the federal government will provide catalytic support to projects happening across Canada and incentivize innovation. Government procurement also provides a clear market signal that will help boost investor confidence and grow demand for responsible deployment of carbon dioxide removal solutions."

He added, "Carbon removal is forecast to be a trillion-dollar industry and is poised to create jobs in countries that establish clear, predictable pathways for deployment. Canada is poised to play a leadership role. As carbon removal scales in Canada, taking a tech-inclusive policy approach will ensure a level playing field for innovation."

About Carbon Business Council

The Carbon Business Council is a global coalition representing more than 100 companies across six continents, unified in their mission to restore the climate responsibly. The Council works to advance policy, boost investment, and support the scaling of carbon removal technologies toward gigaton-level impact.