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Published on March 24, 2022

Introducing the world´s first reference price indexes for engineered carbon removal

We are thrilled to announce that today Nasdaq has launched three new commodity reference price indexes based on the trading of Puro Standard CORCs (CO2 Removal Certificates).

The new indexes are:

  • CORC Carbon Removal Price Index (Nasdaq: CORCX)
  • CORC Biochar Price Index (Nasdaq: CORCCHAR)
  • CORC Bio-based Construction Materials Price Index (Nasdaq: CORCWOOD)

This launch marks an exciting moment for the voluntary carbon market as the new index family brings price transparency and helps corporations understand the true cost of removing their emissions. The indexes will also give visibility of carbon removal pricing trends to ESG and climate finance stakeholders such as carbon removal suppliers, project developers, asset managers and investors. This will stimulate growth by supporting the business case for new carbon removal projects and helping potential investors into these ventures make better informed decisions.

Reaching a livable Earth and less than 1.5 degrees temperature raise, requires a fully functioning carbon removal industry, an efficient market infrastructure that facilitates action and an immense amount of capital focused at decarbonizing the economy.

With the reference price indexes we want to accelerate these efforts to mobilize carbon removal at a global industrial scale. CORCX reflects the cost of sequestering one metric ton of CO2 based on an aggregation of all CORC transactions from the engineered carbon removal methods supported by the Puro Standard. CORCCHAR reflects the price of sequestering one metric ton of CO2 in the form of biochar, and similarly, CORCWOOD, from biomass-based construction materials such as wooden building elements. As projects from innovative carbon removal methodologies become operational thanks to the corporations and investors that support new approaches, additional indexes will be launched.

CORC price setting may be influenced by the historical prices that will now be transparently available with the indexes but our suppliers will continue to set their own CORC prices based on their costs to remove carbon from the atmosphere with their method. The indexes offer an opportunity for risk hedging for buyers as pre-purchase agreements for CORCs could have a base price that can be adjusted with the change in the reference price index later.

As the index value comes from volume weighted average prices (V-WAP) small deals (that may have a high price) will not affect the index as much as the large deals where the buyer may be able to exercise their bargaining power. Therefore, we believe the index could be used as a tool to share some of the risk / upside in long term offtake agreements. 

We are proud that our vertical integration, which covers supplier validation, independent carbon standard and CORC trading, makes our platform more efficient and lets suppliers get access to buyers and capital, making Puro.earth the choice to monetize their much needed climate service. Besides, our framework puts together independent verification as emphasized by the likes of Voluntary Carbon Markets Integrity Initiative and ICROA.

Over time, as the voluntary market for carbon removal becomes more liquid, the reference price index family will serve as a platform to create new innovative financial products that support our journey towards a net zero economy and has the potential to pave the way for the commoditization of CORCs.

The launch of the index family is a clear result of our partnership with Nasdaq and follows the recent launch of Puro Registry and the Pre-CORC Framework.  These initiatives are our delivery to the carbon markets and ESG communities, who can now leverage carbon removal data as a valuable metric to manage, compare and report.

We believe the indexes will create a surge in corporate demand for negative emissions, bringing liquidity to the carbon removal suppliers who need the revenue streams from CORCs to start and grow.

Antti Vihavainen
CEO of Puro.earth

Visit the reference price index page here

 

Are you ready to include science-based carbon removal in your climate actions? Welcome to learn more about our Carbon Removal Suppliers and don't hesitate to book a meeting or contact us.

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