Description of the Company
OXO Earth Technologies is a company that was established in Germany in 2023 by Farid Kreh and Philipp Stauffenberg with a startup capital of 50,000 EUR. It uses biomass CDR via improved forest management as this method is cost-efficient, scalable and easy to deploy.
CDR Support
The company received a total of 200k funding from the European Space Agency (ESA) via the ESA Business Incubator and the ESA Boost Program for feasibility studies in the space sector. Together with ESA the company develops a technology to robustly and accurately quantify above-ground biomass using earth observation data, such as LiDAR and satellite imagery. The company raised additional funding from angel investors and family businesses totaling roughly EUR 500k. Other investors include leading corporations from the energy sector as well as the Bavarian government. In addition, crucial CDR support is provided by the Remove Accelerator, a program run by a non-governmental entity that supports nascent CDR businesses financially and by ensuring that they can receive advice from specialists with expertise in the CDR business landscape.
CDR Market
The company participates in the voluntary carbon market and its main clients operate in a variety of sectors such as financial services, insurance/banks, agriculture and manufacturing. The company sells carbon credits to a few German corporations, but mostly to German small and medium sized enterprises (SMEs). Forest CDR works particularly well for companies with timber in their value chain that operate in sectors such as pulp & paper, furniture, construction and packaging.
CDR Regulations
There were no CDR-specific requirements and incentives when the company started its operation. The company eagerly anticipates proper regulation from the European Union. Today, the market is fragmented and regulation is missing. Standards set by multi-stakeholder initiatives like the Voluntary Carbon Market Integrity (VCMI) Initiative, Integrity Council for the Voluntary Carbon Market (ICVCM), ICROA, International Carbon Registry and Carbon Standards International provide guidance. However, a real regulatory framework with a public registry, run by the EU is needed to give confidence and clarity to prospective buyers of CDR credits.
CDR Outlook
The company plans to expand its business globally, targeting the EU, USA and Canada. It is of the opinion that CDR ‘will be a massive global industry similar to the size of Oil & Gas today.’ The main barriers that the company is facing include missing demand due to high costs and inadequate regulation. The factors that may prevent the company from engaging in long-term CDR include uncertain regulatory environment and costs of the negative emission technologies. However, there are also positive signs that can facilitate long term deployment including the increasing awareness regarding the necessity to take immediate action to tackle the climate crisis, growth with the number of zero pledges and first signs of government support for CDR.
CDR and Society
The company engages regularly with stakeholders of the communities in which it does business. It regularly exchanges ideas with forest owners, foresters, certification providers, standards and auditors as well as registries, policy makers and academia to help build the regulatory framework for CDR and to create a sense of urgency for the entirety of CDR solutions, not just forestry. In relation to individuals that reside in locations where it does business, it has rigid checks and balances in place to prevent negative outcomes.