The biggest US bank, JPMorgan, will invest over $200 million to purchase carbon removal credits from different startups to neutralize its environmental footprint, the Wall Street Journal reported on Tuesday. With the move, the Wall Street bank also aims to gain a foothold in the burgeoning clean-energy industry.
JPMorgan Aims to Remove 800K Tons of CO2 from the Atmosphere
According to the Wall Street Journal, JPMorgan plans to pour more than $200 million into buying carbon removal credits from several companies.
The move marks one of the biggest-ever efforts to remove carbon from the atmosphere in the global fight against climate change. In addition, it represents a major boost to businesses that have eliminated only a minor portion of carbon so far.
The investments come as the bank seeks to neutralize its carbon footprint and establish itself as a leader in the nascent clean-energy industry. In 2022, JPMorgan participated in the $650 million funding round raised by carbon removal startup Climeworks.
“We’re jumping in the pool all in. This is us putting our weight and our capital behind something we believe is truly important to bring to market now.”
– said BrianDiMarino, head of operational sustainability at JPMorgan.
JPMorgan, the largest bank in the US, intends to buy credits to remove from several startups, including Climeworks, to eradicate 800,000 metric tons of carbon dioxide (CO2) from the atmosphere. Climeworks is a Swiss-based startup that pledged to remove 25,000 metric tons of carbon dioxide over nine years.
What are Carbon Removal Credits?
Carbon removal credits refer to a mechanism designed to reduce the CO2 footprint and mitigate the impact of greenhouse gas emissions. They are often compared to carbon offset credits, but the two differ notably in their approach and purpose.
For example, carbon removal credits focus on directly removing CO2 from the atmosphere through different technologies and strategies that capture and store carbon emissions. These include direct air capture, bioenergy with carbon capture and storage, and afforestation.
Carbon offset credits, on the other hand, primarily aim to compensate for greenhouse gas emissions by supporting projects that reduce emissions elsewhere. They involve renewable energy projects, energy efficiency initiatives, or reforestation efforts.
Alternatively, some companies and organizations are tapping into the growing blockchain technology to back those fighting climate change. Last year, the International Finance Corp (IFC) announced it is co-launching a fund to provide blockchain-powered carbon offsets. Similarly, the Bank for International Settlements (BIS) joined forces with other major financial institutions in October 2022 to explore the usage of blockchain and smart contracts to improve the efficiency of the green bond market.
This article originally appeared on The Tokenist
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