Energy Department names 24 semifinalists for carbon removal purchasing prize

An Energy Department official, a representative of the Office of Fossil Energy and Carbon Management, announced the agency had selected 24 semifinalists for a carbon dioxide removal (CDR) purchasing prize and awarded each a $50,000 milestone payment.

The official said the prize is structured in three phases: an initial concept selection (the announced semifinalists), a refinement phase where semifinalists develop full contracts and measurement, reporting and verification (MRV) plans, and a final delivery phase in which up to 10 finalists may each receive $3,000,000 upon verified delivery of CDR credits to the U.S. government. "These 24 semifinalists will now compete for a next round of prizes," the official said, and described the effort as a demand‑side tool to help catalyze voluntary markets.

The Department framed the prize as part of its broader carbon negative shot goal — a campaign intended to help bring the cost of carbon removal toward $100 per ton within about a decade — and tied the program to funding from the bipartisan infrastructure law, a $3.5 billion direct air capture hubs program, and other appropriations. The transcript also referenced the "45 2 tax credit" and the Inflation Reduction Act as complementary incentives; the announcement did not specify the statutory citation for the "45 2 tax credit." The official said DOE will apply both internal and external expertise — including national labs and contractor CarbonDirect — to evaluate projects.

DOE said the competition favored approaches that deliver long‑lived carbon removal, setting a durability requirement of geologic storage or an equivalent long‑lived outcome. The Department emphasized MRV and credibility as central criteria so that purchasers and policymakers can have confidence the claimed removals are real and durable. The official also said community benefit plans were required and would be evaluated throughout project lifecycles.

Selected semifinalists span multiple technology pathways, including nine direct air capture and storage projects, a set of biomass‑based removal approaches (including bioenergy with carbon capture and alternative biomass burial), enhanced weathering proposals, and ocean or marine removal efforts. The Department highlighted geographic diversity among the awardees and said project locations and headquarters are expected to be spread across the United States. The official also noted interagency coordination—for example, support to EPA on class 6 CO2 permitting and NOAA's role in marine research.

Phase 2 will ask semifinalists to produce full contracts with detailed MRV plans; DOE will then down‑select finalists who could receive milestone payments and, on verified delivery, the $3 million prize. The Department said Congress has appropriated an additional $20,000,000 for a second round of purchases in the FY24 spending bill and that bipartisan bills are under consideration that could support further purchasing activities.

DOE described the purchasing pilot as an intentional, pilot‑scale effort meant to learn alongside the market and to signal confidence to voluntary purchasers; the Department said it hopes the program will help attract more external buyers and support job and economic opportunities for communities as carbon removal scales.