On January 1, Switzerland's Climate and Innovation Act came into force, marking a significant milestone for carbon dioxide removal (CDR). Switzerland is now well positioned to become the first country to mandate corporate CDR purchases. The legislation also allocates up to CHF100 million to support CDR project developers. This showcases how policy can play a critical role in supporting both the demand and supply sides of the carbon removal industry.
The Climate and Innovation Act encourages Swiss businesses to develop comprehensive roadmaps toward achieving net-zero emissions by 2050, encompassing Scope 1, 2 and 3 emissions. The legislation outlines that carbon removal must play a central role in this transition. The Swiss guidelines recommend that companies set targets every five years to steadily increase both their emissions reduction and carbon removal. This means setting clear intermediate targets at 5 year intervals: for 2030, 2035, 2040 and 2045. This recognizes the reality that companies will increasingly need to turn to carbon removal to reach net zero as they encounter hard-to-abate emissions within their supply chains.
The Act addresses a fundamental challenge in our sector—scaling supply now to be ready to meet ambitious 2050 goals. By incentivizing companies to develop long-term plans, it creates a clear demand signal that supports industry growth.
While the net-zero roadmaps remain optional—except for companies seeking funding from the Climate Act's CHF1.2 billion package—the guidelines establish an important precedent. This funding package includes CHF100 million specifically allocated for Carbon Capture and Storage and CDR projects. Suppliers can receive significant support, with up to 50% of both capital expenditure and operating costs covered over a seven-year period. The tender is live, with initial applications due by April 25.
The Act is by no means perfect. For instance, the CHF100 million funding is largely targeted to the Bioenergy with Carbon Capture and Storage and Direct Air Capture pathways for CDR, while the optional nature of net-zero roadmaps for most businesses reduces its immediate impact. Nevertheless, the Act creates a clear and important precedent: procuring high-quality CDR now is critical to meeting your business’ regulatory obligations in the future. Isometric’s approach is to ensure that we only issue the most scientifically rigorous CDR credits possible, so that we can meet all regulatory requirements as these are developed around the world.
