We sat down with eleven CEOs and CFOs of the world’s leading carbon removal project developers from across the ecosystem — enhanced rock weathering, direct air capture, biochar, ocean alkalinity enhancement, hydrothermal liquefaction, CO₂ mineralisation storage, and native species reforestation — all described strikingly similar financing bottlenecks. Projects ranged from pre-revenue to those holding landmark offtake contracts with major tech buyers. Geographies spanned the Americas, Europe, South Asia, and the Gulf Coast. 

The session was held under Chatham House Rules; what follows reflects the patterns we heard almost unanimously across the room, not the individual participants.

Financing Carbon Removal Is Expensive, Bespoke, and Painful

Nearly every participant was still primarily equity-funded — not by choice, but because the debt alternatives available were no better. 

One developer with multiple certified credits and established buyers described receiving offers where the cost of capital was on par with equity, plus covenants. Another had been offered a term sheet that demanded a right to finance their next 100+ million dollar deployment at predetermined terms. A third signed a term sheet, then discovered it included fees on past projects the developer had self-financed — a structure that made no sense in project finance terms.

One developer — ten years into building their company, with no venture capital investors and a six-figure offtake contract from a major buyer consortium — summarised the dynamic plainly: even with those contracts, prospective lenders asked why they didn't simply sell their product to a refinery. The carbon removal market, as an asset class, is still not eligible to most capital providers.

Several developers described education processes of six to twelve months before serious lender engagement could begin. One, seeking $50–150 million to scale a proven copy-paste model, described investors with ostensibly "green" mandates who applied conventional infrastructure logic to carbon removal projects and found they fit no existing category. The frustration was not with the absence of capital, but with the absence of understanding.

The Offtake Mismatch

Many engineered removal projects and plants are designed to operate for decades. However, most offtake agreements in today's market run for two to three years.

No lender can underwrite a multi-decade asset against a two-year contract. Major marketplaces, even well-intentioned ones, structurally cannot provide the long-term commitments lenders need — balance sheet constraints prevent it. The uncontracted years are where deals break down.

One developer described the core tension precisely: at a deployment cost of $500 million to $1 billion, post-FID institutional appetite is real. Investors at that ticket size will engage. The challenge is the pre-FID phase — where long-lead equipment must be ordered and detailed engineering completed before bankable certainty exists. That phase remains largely unfunded.

Another raised the idea of using the ETS price as a floor to value uncontracted inventory — treating potential future compliance-market credits as partial collateral. The mechanics still need working through, particularly around delivery risk and the gap between current ETS pricing and operational costs, but the concept has traction.

The pricing dynamics compound this. Investors — including equity investors — are requesting lower per-tonne economics before committing capital. But reaching cost targets requires scale that can only be achieved with that capital. One developer estimated that reaching the price/tonne expected from the market would require half to a million tonnes of annual capacity — orders of magnitude beyond current single-project scale. Without long-tenor offtakes, projects cannot reach the volumes that make the economics investable; without investable economics, long-tenor offtakes do not materialise.

Insurance: No Longer Optional

Carbon delivery insurance is becoming a baseline requirement for institutional deals. In the session, no participant described a completed institutional financing arrangement that lacked some form of delivery insurance — including deals structured with first-loss philanthropic capital. Even where concessional capital was present, insurance was required before the deal could move.

Costs ranged from 2% to 5%, driven primarily by technology readiness, pathway maturity, and coverage needed. The range reflects the market's current state: the more novel the technology, the fewer reference points insurers have, and the higher the premium.

The notable exception was nature-based reforestation, where established biological track records give lenders a confidence base that novel engineered pathways cannot yet offer. As one participant observed, growing trees has the highest technology readiness of any removal method — and that familiarity turns out to be a genuine financing advantage.

Structures That Are Starting to Work

Where financing has worked, it has worked because someone designed the structure around the asset — not the other way around.

Several approaches emerged from the discussion worth noting:

• Repayment terms tied to actual cash flow availability rather than fixed schedules — structures that flex with when revenue actually arrives, rather than assuming steady income from day one.
• Repayment linked to a future fundraising round rather than project cash flows, with buffer years built in for timing uncertainty. For early-stage projects without predictable revenue, this separates the cost of financing from the cost of delivery.
• Advanced rate sweeps of 25–50% of offtake value, allowing partial upfront financing without requiring full delivery certainty. The lender takes a view on past performance and delivery track record rather than demanding guarantees on every tonne.
• And in one case, using future credit supply to attract offtake first — reversing the conventional sequence in which offtake secures capital. This is how a high-profile deal between a major bank and a CDR developer was structured: credit supply as the lead, not the follow.
• Automated monitoring also emerged as a cost reducer. Real-time sensor data feeding directly to registry systems removes manual verification steps and changes the risk profile that lenders and insurers price against. For developers with fully digitised measurement, reporting and verification, this translates directly into lower insurance costs.

What connects these structures is a principle that applies equally on the financing side as it does on the purchasing side: risk is best managed across a portfolio, not project by project. Lenders and insurers underwriting a diversified set of removal methods — spanning nature-based, hybrid, and engineered pathways — face a fundamentally different risk profile than those underwriting a single project. Several participants noted that channel partners offering delivery insurance across multiple projects were able to absorb risk that no single-project structure could manage alone

Speed Is the Underrated Variable

Speed was a recurring theme. Term sheets arrived in two to four months, but the more revealing insight was how rarely the process led to a signed deal. One developer — shovel-ready, with six-month equipment lead times — described speed as the single most important variable after cost.

Diligence processes of six to nine months are structurally incompatible with the pace carbon removal projects need to move. Every month in diligence is a month of long-lead equipment not ordered, development capital sitting idle, and project timelines slipping.

The corollary: when one project successfully closes a structure, the template has value far beyond that individual deal. The market needs reusable frameworks for diligence, legal structuring, and payment tracking — infrastructure that compresses timelines not just for one developer, but for the next hundred.

Why This Matters Beyond Financing

One insight from CUR8's own due diligence work underscores why the financing gap has consequences well beyond the developers in the room. Across more than 300 data points assessed in CUR8's project evaluation framework, the sub-factor most highly correlated with non-delivery or under-delivery of carbon credits is financing risk — projects running out of capital before they can fulfil their contracts. The financing gap is not merely a developer problem. It is a buyer problem, a delivery problem, and ultimately a market integrity problem.

Where CUR8 Fits

The problems described here — tenor mismatches, investor education gaps, insurance requirements, diligence timelines — are the reason CUR8 built its carbon finance function. Working alongside a growing network of global banks and insurers, CUR8 has developed an offtake financing product designed for the specific commercial reality of carbon removal: converting signed forward contracts into upfront capital, with assessments built to meet the bar for institutional lenders.

The due diligence framework underpinning this has been developed with direct input from banking and insurance partners — through the process of structuring and closing real deals, not as a theoretical exercise. A significant part of that work involves translating the science of each pathway into the mathematics that lenders and insurers can price against.

CUR8 is launching a productised version of this process — designed to compress what currently takes months into weeks, and to create reusable infrastructure that other market participants can build on.

If you are a developer navigating this gap, or a capital provider looking to understand what "bankable" looks like in carbon removal, and would like early access, reach out. We're building the waitlist now.