Swiss Re has signed a ten-year carbon removal purchase agreement with Climeworks. The arrangement with the specialist in carbon dioxide air capture technology is understood to be the world's first long-term purchase agreement for direct air capture and storage of carbon dioxide, worth US$10m over ten years.

As part of the arrangement, the companies also agreed to collaborate on developing risk management knowledge and risk transfer solutions, as well as to explore future investment and project finance opportunities.

For Swiss Re, the collaboration forms part of its goal of reaching net-zero emissions in its own operations by 2030.

Christian Mumenthaler, Swiss Re’s group chief executive officer and co-chair of the World Economic Forum's Alliance of CEO Climate Leaders, said: ”To mitigate the risks of climate change, the world needs to scale-up carbon removal on top of, not instead of emission reductions. By partnering with Climeworks we can play to our strengths in this endeavour, as a risk taker, investor, and forward-looking buyer of climate solutions."

Christoph Gebald, co-CEO and co-founder of Climeworks, added: ”We are very proud to have established the basis for a unique long-term partnership with the leading risk knowledge company Swiss Re. This is a decisive milestone for the scale-up of Climeworks and the direct air capture industry.”

The carbon removal solution offered by Climeworks in Iceland filters carbon dioxide from ambient air using geothermal energy. The captured CO2 is then sent for permanent storage in nearby rock layers. It is dissolved in water and pumped underground, where it reacts naturally with the surrounding basalt rock to form stable carbonate minerals – the CO2 literally turns into stone. This is considered the safest, most durable form of all carbon removal solutions that are commercially available today.

At a price point of several hundred dollars per tonne of CO2 removed, it is also currently one of the most costly options.

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