Salesforce Bets Big on Carbon Removal Technology

Salesforce has revealed three major climate efforts, including a $25 million investment to advance carbon removal, to hasten the transition to a fair and sustainable energy system, including Salesforce has revealed three major climate efforts, including Salesforce carbon removal technology.

Salesforce, the cloud software giant based in San Francisco, has committed $25 million to carbon dioxide removal technology through Frontier. This funding aims to support carbon removal startups, demonstrating demand for their products and accelerating industry growth. This initial investment is part of a larger pledge Salesforce made in 2022 to purchase $100 million worth of carbon dioxide removal credits by 2030.

“This industry needs to scale. It needs investment early on so that today’s technologies can become commercially available to all buyers by 2030 and beyond,” says Jamila Yamani, Salesforce’s lead for carbon removal.

The Need for Carbon Removal

While many climate strategies focus on reducing emissions, carbon removal seeks to pull carbon dioxide from the atmosphere through various methods. This emerging technology has garnered both interest and criticism due to its current high costs and developmental stage. For instance, direct air capture—a form of carbon removal—costs about $600 to $1,000 per ton of CO2 removed, according to a 2023 estimate by a Boston Consulting Group executive. To be widely adopted, costs need to fall below $200 per ton.

Frontier’s Role

Frontier, a subsidiary of fintech company Stripe, aims to accelerate carbon removal technology development by creating a market for it. “Carbon removal has no intrinsic value, so there isn’t a natural customer like with energy,” explains Nan Ransohoff, head of climate at Stripe and Frontier. This lack of natural customers means fewer startups in the space, and those that exist offer high rates due to the lack of scale.

Frontier’s funds become revenue for startups, not equity investments. To date, Frontier has over $1 billion committed, with around $230 million in contracted offtake agreements with specific companies.

Expanding the Market

“The idea with Frontier was to send a loud demand signal to entrepreneurs, investors, and researchers that there is a market for carbon removal technologies, especially those in early stages,” says Ransohoff. “This is now over a billion dollars of revenue for carbon removal companies.”

Salesforce joins other major companies in Frontier, including Google parent company Alphabet, Meta, Stripe, Shopify, and McKinsey Sustainability. Frontier’s portfolio includes technologies like Lithos, which uses basalt to capture CO2, and Heirloom, which employs limestone as a carbon sink.

The Advantage of Frontier

Though companies like Salesforce could establish their own offtake agreements, Ransohoff notes that pooling resources through Frontier sends a “louder signal” to the market and allows for better vetting of startups. “We have six PhDs full-time on staff dedicated to finding and vetting the best companies,” she says.

Salesforce’s Comprehensive Climate Strategy

Carbon removal is just one part of Salesforce’s broader climate change mitigation strategy. Yamani highlights that Salesforce also focuses on grid decarbonization, nature restoration, sustainable aviation, decentralized renewable energy, and more. The company aims to cut its absolute emissions by 50% by 2030 and reach “near zero by 2040.”

“It’s an all-of-the-above approach where we’re leveraging all tools to build a portfolio that can help decarbonize the planet. It’s not a one-size-fits-all solution,” says Yamani.

At the core, lies Salesforce Net Zero Cloud.

In addition to the carbon removal commitment, Salesforce recently signed a 15-year virtual power purchase agreement with Qualitas Energy in Italy to expand its solar energy portfolio. “Corporate procurements can catalyze new renewable energy markets, providing clean electricity worldwide,” Yamani adds.

With this move, Salesforce is demonstrating its commitment to achieving 100% renewable energy dependency and is making its first step into virtual power purchase agreements (VPPAs) in Europe.

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