Morgan Stanley has signed a long-term agreement with Climeworks, a carbon removal company, to remove 40,000 tons of CO₂ from the atmosphere. The partnership, set to last until 2037, marks Climeworks’ second-largest contract to date and will expedite its expansion in the US, where it serves as the anchor technology provider for the Direct Air Capture Hub Project Cypress, supported by the US Department of Energy. Morgan Stanley’s investment in Climeworks’ carbon removal service underscores its commitment to fostering new climate technology.
Morgan Stanley has set a target to achieve net-zero financed emissions by 2050 and to mobilise $1 trillion in sustainable finance by 2030. Its collaboration with Climeworks secures a significant volume of carbon removal credits and represents the firm’s first purchase of Direct Air Capture credits.
“As a financial institution, Morgan Stanley plays an important role in helping to direct capital toward low-carbon solutions. Through our partnership with Climeworks, we are supporting the development of technology that can help drive the global economy’s transition to a more sustainable future,” said Jessica Alsford, Morgan Stanley’s Chief Sustainability Officer.
Global efforts to reduce CO₂ emissions to net zero will face considerable challenges, given historical emissions and residual CO₂ that continue to warm the planet. In 2023, the global average temperature reached a record-breaking 1.45°C above pre-industrial levels, with extreme weather events causing an estimated USD 92.9 billion in damages in the US alone. Such data highlights the need for large-scale carbon removal solutions.
Christoph Gebald, co-founder and co-CEO of Climeworks said, “Investing in carbon removal is more than an environmental responsibility – it’s a strategic move. By securing access to high-quality carbon removals now, companies position themselves ahead of the curve of future regulatory changes and competitive pressures. Orca and Mammoth represent just the beginning of a future trillion-dollar industry and Morgan Stanley understands the benefits of entering the market today.”
Climeworks currently operates two Direct Air Capture plants in Iceland and provides third-party certified carbon removal services. As the lead technology provider for Direct Air Capture Hub Project Cypress in Louisiana, Climeworks is on track to establish one of the first large-scale carbon removal hubs in the US, an initiative incentivised by the Bipartisan Infrastructure Law.
