Putting a number on carbon-removal uncertainty
Carbon-removal projects are often compared through broad labels such as nature-based or engineered, permanent or nonpermanent. A new proposed metric aims to replace some of that shorthand with a common measure of risk.
Researchers at the University of Exeter and collaborating industry stakeholders have introduced Carbon at Risk, or CaR, a framework designed to quantify the risk that a carbon-removal project delivers less removal than originally contracted. The work is published in Nature Climate Change.
The proposal is intended for a market in which projects can differ radically in method and exposure. Afforestation, for example, may face environmental threats such as wildfire. Geological storage involves a different set of technical, operational and political uncertainties. Yet buyers, insurers, regulators and investors need a way to compare the reliability of claimed removals across those differences.
From qualitative labels to comparable exposure
Carbon-removal projects seek to remove carbon dioxide from the atmosphere and store it for a meaningful period. Their risks are not identical: some may fail to deliver the expected quantity of removal, while others may be exposed to conditions that threaten the durability of storage.
Until now, those risks have commonly been discussed in qualitative terms. The researchers argue that this creates uncertainty for buyers trying to assess what removals they receive for their spending and for insurers looking for a quantitative basis on which to underwrite potential reversals.
CaR is intended to express the possibility of a shortfall on a standardized scale, regardless of the technology involved. The idea is not that every project should be treated as equivalent. Rather, it is to make different risks more legible when projects are evaluated together.
A portfolio approach to climate claims
The framework takes inspiration from Value at Risk, a financial measure developed to compare exposure across different assets. The researchers apply a similar portfolio concept to carbon removal: a collection of projects facing different, independent risks may be less exposed to a single failure than a collection vulnerable to the same event or condition.
That matters for organizations purchasing removals to support climate targets. A portfolio concentrated in projects that could all underperform for closely related reasons may carry more risk than one diversified across different storage approaches and locations. Forest projects, for instance, may face wildfire risks that are not necessarily shared by geological storage projects.
The researchers developed CaR through workshops involving academics and industry stakeholders, then used forest-carbon and geological-storage case studies as proof of concept. The metric is proposed as a tool for constructing more resilient portfolios, rather than as a claim that one type of removal is automatically preferable to another.
Implications for buyers, insurers and regulators
If adopted and refined, a common risk language could affect how carbon-removal contracts are structured. Buyers could assess not only the nominal quantity of carbon dioxide a project says it will remove, but also the risk that the contracted outcome is not achieved. Insurers could gain a more consistent starting point for evaluating reversal exposure.
For regulators and investors, the same approach could make it easier to compare projects that otherwise appear difficult to place on a common scale. The researchers say a better ability to manage risk could help unlock investment needed for efforts intended to limit warming to 1.5°C.
The proposal does not remove the underlying uncertainty of carbon removal. Forests can burn, technologies can underperform and political conditions can change. Its contribution is to make those uncertainties explicit and comparable, so that decisions are made with a clearer view of what may fall short.
Why measurement is becoming central
As carbon-removal markets expand, confidence in measurement and delivery will be as important as the headline volume of tonnes contracted. CaR suggests that a credible market needs to distinguish between a promised removal and the probability that it will be realized and retained.
Whether the metric becomes widely used will depend on how buyers, insurers and standards bodies respond. But the proposal highlights a growing shift in the field: carbon removal is not only a question of how much carbon can be captured or stored, but how transparently the risk of failure can be understood and managed.
This article is based on reporting by Phys.org. Read the original article.
Originally published on phys.org
