Google announced today an agreement with Direct Air Capture (DAC) technology company Holocene for the delivery of 100,000 tons of carbon removal credits, with the deal marking the lowest-ever price on record for DAC-based removal, at $100 per ton.

DAC technology, listed by the IEA as a key carbon removal option in the transition to a net-zero energy system, extracts CO2 directly from the atmosphere for use as a raw material or permanently removed when combined with storage. According to the Intergovernmental Panel on Climate Change (IPCC), scenarios that limit warming to 1.5°C include carbon dioxide removal methods scaling to billions of tons of removal annually over the coming decades, with DAC positioned to potentially account for a significant portion of the total.

Founded in 2022, Knoxville, Tennessee-based Holocene provides a scalable DAC solution using amino acids and other organic compounds to pull CO2 from the atmosphere, which is then concentrated and heated to low temperatures to create a pure stream of CO2 for transport and permanent underground storage.

In a post announcing the new agreement, Randy Spock, Carbon Credits and Removals Lead at Google, said:

“We’re committed to doing our part to decarbonize the global economy and reach our goal of net zero emissions across our operations. Carbon removal technologies are key to that goal. Partnering with Holocene to reach this milestone price will be a meaningful step toward advancing the viability of DAC as a tool to fight climate change.”

According to Google, the achievement of the low price for the agreement was made possible by a series of factors, including Holocene’s solution’s combination of both liquid and solid-based systems, which has high potential to reduce costs over the long term, Google’s providing of financial support up front, combined with a commitment to accept credits from Holocene’s lower-cost facilities, scheduled for delivery in the early 2030s, and the qualification of Holocene’s projects for the U.S. government’s 45Q tax credit, which provides DAC suppliers with a credit of $180 per ton of carbon removed.

Spock added:

“Our partnership with Holocene aims to address one of the key barriers facing DAC technologies: the hefty price tag. While Holocene’s technology is still in the early stages of development, it has the potential to bring down costs significantly over time.”

The agreement follows a commitment announced in March by Google to contract for at least $35 million of carbon removal credits over the next 12 months, as part of an initiative by the U.S. Department of Energy (DOE) aimed at helping to scale the carbon removal sector by funding the sector’s innovations and technology.