On Wednesday, energy major bp announced that it has acquired a majority stake in carbon offset developer Finite Carbon, adding to an existing investment in the firm. Finite Carbon is the largest developer of forest carbon offsets in the United States.
As part of the deal, bp will bring the firm into its in-house business accelerator, bp Launchpad, an initiative that provides multi-year funding to scale energy-innovating companies that (according to bp) “operates like private equity, [and] feels like a startup.” In addition to supporting long-term growth initiatives, bp Launchpad offers an incentivized exit path for its portfolio companies.
Launchpad
Together with bp’s additional investment, inclusion in the bp Launchpad program is expected to bolster Finite Carbon’s expansion, including expansion into new geographical markets.
“Finite Carbon has the potential to build a global platform for managing and financing natural climate solutions (NCS),” bp’s Executive VP of Innovation and Engineer David Eyton said in an official announcement. “Deepening our partnership will allow them to accelerate their development and expansion. Finite Carbon’s progression through bp – from venturing investment to majority ownership and introduction to Launchpad – is a great example of how we are applying our unique innovation ecosystem to foster innovation and build material energy businesses in support of our net zero ambition.”
Finite Carbon identifies and develops projects that enable landowners to generate revenue from the protection, restoration, and sustainable management of forests. Stewardship practices like these increase the amount of carbon stored in forests, and generate carbon offsets that are verified against industry-recognized standards. These offsets can be traded on markets.
Today, the company has 50 such carbon projects spanning 3 million forest acres in the United States, which to date have registered more than 70 million independently-verified offsets and generated in excess of $500 million in revenue for landowners.
Finite Carbon’s client base includes a diverse set of forest-owning corporations and forestry service providers, land trusts and non-profits, Native American communities, Timber Investment Management Organizations (TIMOs) and forestry REITs, and family forest landowners of all sizes.
CORE Carbon
Following bp’s investment, Finite Carbon hopes to facilitate another $1 billion to landowners by 2030 from existing business lines, as well as its new CORE Carbon initiative. CORE Carbon has been billed as the first web-based platform that enables small-size landowners to access the carbon offset market by removing or alleviating barriers to entry to the carbon market (such as the high cost of transaction monitoring and reporting) that have prevented small landowners from monetizing their land holdings by incentivizing good stewardship.
“Putting a price on carbon can make it possible for anyone with the ability to protect, plant, or improve forests to generate revenue from their efforts,” Finite Carbon founder Sean Carney said on Wednesday. “However, there is currently limited infrastructure to quantify, monitor, and verify these actions at scale. Thanks to this unique partnership with bp, Finite Carbon now has the resources of a global energy company behind it to help address this enormous environmental challenge and help small landowners access this market.”
Finite Carbon will become bp Launchpad’s fifth portfolio company. Other firms in the accelerator program include subsurface analytics firm Lytt, seismic receiver technology firm STRYDE, fiberoptic sensing company Fotech, and Onyx, which provides predictive analytics for the wind energy sector.
