Carbon Removal Financing

Citi Bank has closed a $72 million, 3.5-year principal-protected Carbon Removal-linked Note to support Applied Carbon's biochar project in Texas. Investors forgo traditional coupons, with an upfront amount financing the project and later payments tied to the issuance and delivery of carbon credits it generates.

Applied Carbon's mobile pyrolysis platform converts agricultural crop residue into biochar in the field, in a single pass that combines pyrolysis and application. Microsoft signed an offtake agreement for a portion of the credits in 2022, and Nuveen participated as an investor in the note.

As carbon removal projects compete for private capital, this note signals how outcome-linked structures can finance biochar assets like any other infrastructure, bringing together investors, developers, and long-term credit buyers while giving farmers across Texas a path to scale.