How do registries create carbon removal methodologies? Who should be involved in the process, and to what degree? How does one balance all of the competing attributes and stakeholders?
Today's episode is a show in three parts:
First, Nori co-founder and host ofReversing Climate Changeintroduces the context for the main segment which was recorded the better part of a year before its airing. He explores whether or not the quasi-regulatory requirement for registries not to also be marketplaces leads to proprietary methodologies.
Secondly, as Nori has closed down since the recording of this episode, Ross chats with Anu Khan, the Founder and Executive Director of the Carbon Removal Standards Initiative to discuss her work of building an ark for carbon removal methodologies and how that work informs policy and the growth of carbon removal.
Thirdly, is the original body of the podcast where Ross speaks with Radhika Moolgavkar, formerly the VP of Supply & Methodology at Nori, and Rick Berg, formerly Nori’s Director of Methodology, about the development of Nori’s Direct Air Capture + Storage methodology.
They discuss the importance of open methodology development for transparency and trust, and ungating their work so that others can use it and adapt it under the right Creative Commons licensure.
The nuts and bolts of how the expert advisory panel and public comment period work, as well as how that feedback filters back into the methodology, is explained.
The podcast also covers the decision behind selecting DAC amongst all of the other CDR methodologies, the challenges in methodology harmonization across registries and geographies, and how to handle the future of methodological updates as the industry evolves and more is learned.
Resources
Become a paid subscriber toReversing Climate Change
Read Nori's DAC+S Methodology (coming soon!)
Carbon Removal Standards Initiative
Nori's Creative Commons license
"The Constitution of No Authority" by Lysander Spooner
Full Transcript
Ross Kenyon: podcast. I’ve been a climate tech and carbon removal entrepreneur for the better part of a decade, which in carbon removal and climate tech has a dog. Introducing this show, this is a kind of a strange episode that has a temporal dimension to it that was unexpected. My company Nori, it closed down over the summer after One of the last big projects we did was that we wrote a direct air capture and storage methodology, which was an amazing effort. Our supply team did a great job in doing this science and writing this thing.
And it was just amazing to be a part of it. Nori launched with regenerative agriculture, soil organic carbon credits that we sold. So we had a temporary 10 year carbon removal credit that we were selling. And we moved into direct air capture, wanting to pair soil with something that was very durable. And we ended up creating an extra methodology. So we had a soil methodology, a direct air capture methodology. And then we also had a blended ton methodology that we called the net zero ton, which is that we had A soil carbon credit that was good for 10 years of storage that had already been produced paired with a direct air capture ton that would be delivered within the 10 year period for which the soil carbon credit existed so that you would have.
The ability to cover yourself with a short-term credit that would hold your claim until the durable credit arrived. So we were looking at interesting ways to combine assets. We were thinking about how to make the most out of temporary carbon removal. Which was a difficult product in lots of ways. I don’t think we even to this day really understand what the economic and atmospheric value of temporary carbon storage is. I don’t know that there’s consensus even still. Clearly it has some amount of value. But it’s hard to know exactly how much.
And there are also some serious concerns of if we focus too much on temporary removals, they often are more prone to reversal. Not always. And I wouldn’t say that in so strict a categorical form. But you could also have a case where parts of the biosphere that we trusted to be reliable stores of temporary carbon have now become sources of carbon and now are emitting. We might see that with soil. We might see that with force. We might see that with permafrost, with methane. We didn’t want to have a future where all of our bets as an industry were necessarily loaded up into temporary removals.
The downside here, though, is that the scale for carbon Reversing removal in durable fashion is not as immediately at hand nor as great as it is for temporary removals, but it has the benefit of once it’s stored, the risk of reversal is much lower. The durability is just increased in that way. As someone who likes thinking in terms of trade-offs, I don’t like speaking in terms of pure absolutes. I thought that pairing these two types of credits that have different advantages and disadvantages was really Cool way to go. And so I was excited and proud of our work in Nori.
And so Radhika Moolgavkar and Rick Berg on the supply team at Nori and I recorded this episode before Nori closed down, but it was part of the queue leading up to episodes to be released. And it just didn’t happen before other things happened that took precedence. But it’s a show that I care a lot about. I wanted to make sure that we were able to release it now because the DAC plus S methodology that Rick and Radica and the supply team at Nori made still exists and it exists in a very specific location.
I’m sure you could find it on the Wayback Machine if you wanted to, but the methodology doesn’t live in some publicly accessible place as far as I know. It does live on at the Carbon Removal Standards Initiative, or Searcy for short, which is a nonprofit that provides technical assistance to policymakers and policy NGOs on carbon removal quantification. And their ultimate vision is to help build a carbon removal industry that is transparent and accountable and worthy of public investment. So, you know, very noble cause here. And the founder and executive director of Searcy is Anu Khan, who joined the show and This time she’s been on several times and I imagine not the last time is on to talk about why making sure Nori’s direct air capture and storage methodology should be stored publicly accessible and live on.
So we talk about how. We published under a very permissive Creative Commons license that allowed for commercial reuse, for remixing, as long as it was credited back to Nori, where that isn’t that common in methodologies. One of the things that I thought a lot about was thinking And I think that’s what we talked a lot about in the last six months or so of Nori was, Nori made bold design decisions. And one of the design decisions that we made was to remain vertically integrated. And vertical integration is a concept that shows up in corporate governance.
So I’m going to talk a little bit about that. I’m going to talk a little bit about that. The entire process of something from end to end. You can see some of the companies that are very valuable brands pursue a strategy of vertical integration. Apple is a famous one. They have strict standards, certainly stricter than Android for what makes it into their app store. Their technology is not something that you typically have the ability to muck around in and swap out video cards and things that gamers or people who use PCs and Windows or any of the Linux operating systems are used to tinkering with.
You have a bit of a WYSIWYG experience. It’s highly curated. It’s less customizable, but it is a very trusted brand. You know what you’re getting. You’re unlikely to get blue screens of death in the same way that if you have mucked around with RAM and CPUs and video cards that you’ve grown to expect from working off of a Windows system. And so Nori pursued that approach of wanting to really control quality from end to end and to do things in a new way. Within carbon removal, if you’re listening to this and you don’t already know, carbon removal is not currently regulated as an industry, I would say overall.
Most of the regulation that you’ll see is opt-in. For instance, companies receive reputational advantage by receiving stamps of approval from customers or from various rating agencies or standard setters. So if a company in carbon removal has received a frontier offtake or pre-purchase, that’s typically considered a high mark of quality, at least along some axes. It’s a prestigious deal. Getting a frontier deal is meaningful. Receiving a Microsoft deal is also meaningful. Milky Wire, getting a deal with them, it means that smart people vetted this and they believe this is worth buying.
And that means something in our industry. If you’re a marketplace, it’s a little bit different. And marketplaces or other types of entities potentially become certified or stamped automatically. By a couple of different entities. And the most relevant here are ICROA, ICROA, the International Carbon Reduction and Offset Alliance, and ICVCM, which is the Integrity Council for the Voluntary Carbon Market. And they each have various ways where they certify that entities within carbon markets are high integrity players. One of the standards that they have And I’ll especially point to Ikroa here is that typically you cannot do several functions at the same time.
One cannot, by virtue of these rules, be a registry, someone that is certifying and issuing credits against a methodology. One cannot be a project developer doing the work. And one cannot also be a marketplace, which is actually selling and marketing these credits as their primary function. This is a hard thing to think about because one of the problems with regulating anything in this way is that you’re precluding innovation in certain areas. It’s unclear to me that this forced disaggregation, disintegration, It’s unclear to me that vertical integration within the voluntary carbon markets is inherently bad.
It’s so bad that no matter what else happens, we could not possibly certify this. It’s inherently an untrustworthy style of organization by these lights, by the standard. And It’s unclear to me that we know that is true. In writing this, it’s kind of made me laugh, but Radica called me a libertarian in this show, so I can ham that up a little bit for her if she’d like, but there’s a 19 He wrote a pamphlet called The Constitution of No Authority. And he had a line in it that I’ve never been able to forget because it was so bombastic and such an interesting thought experiment here.
So he has this line that concludes this essay, but whether the constitution really be one thing or another, this much is certain, that it has either authorized such a government as we have had or has been powerless to prevent it. In either case, it is unfit to exist. I’ve often had this thought with ICROA where the registries for which a fair amount of the monkey business, which has happened inside of carbon markets, have received the endorsements of these registries. And so you have to wonder, like, are they preventing a lot more shenanigans that we just don’t know about?
It’s very possible that is true. Or is it something that doesn’t really prevent much of it, but in the process means that we cannot innovate with vertical integration? It’s just considered... Impossible. And therefore we never get to know if we’d have an apple that was truly vertically integrated within carbon removal, because that design opportunity has been closed off to us before we had a chance to play with it. I actually don’t know what the answer is here. And it’s very possible. These quasi-regulatory entities do prevent more problems than they create.
But like any of these things, it’s not obvious to me that regulation is always better in this way because we never get to see the innovation that failed to become because it was closed off by preemptory regulation. But we also never get to see the bad stuff that would have come about due to the absence of that regulation either. I’m not even sure I’m not going to convince you of anything, only that I want to make sure that what regulation does exist, exists for very good reason and that those reasons should be empirical.
And if they are conceptual, they should be well argued. But I also want to make sure that we leave as much innovation space open for people to riff on. The reason why this is relevant right now to the discussion in this podcast is that because one cannot typically be a marketplace and a registry in this disaggregation of functions, I’m charting this out and trying to make sense of why do we have proprietary methodologies everywhere. They essentially have to monetize through paywalling their methodologies. It’s the only way that they can justify the large expense that Anu Khan and I talk about in the show today.
That it costs a lot of money to make a methodology on the low end five figures and the high end could be seven figures and they need to recoup that expense. It’s essentially the only asset you get to produce when you’re a registry that could be uniquely yours that you could And one of the interesting things about Nori is that we felt That’s why we’re here. Really, where we were trying to monetize was in the marketplace layer and not at the registry layer. And because we had all these functions co-located under one entity, we could do that.
And unfortunately, when you have forced disintegration through sales, So I’m going to talk a little bit about this. Like I said, I’m going to say it one more time just so it’s very clear. I’m not even saying that it’s necessarily a bad thing. It’s possible that those reasons are fantastic. It’s possible that those reasons should always exist. And it’s possible that the bad they prevent is worth all of the good that they also prevent. I think that’s true. And just acknowledging those trade-offs is part of what it means to think on the margin, I think as an economist, to also just try to approach things in a way where we’re acknowledging that A few of these decisions are free.
And this is where I can go full economist on this and say there ain’t no such thing as a free lunch. We’re paying for it one way or another. It just depends on how visible or invisible that cost is. And because we never get to see the good that could have been, it’s very I’ll leave you with that. We talk about this on the show, Anu and I do, and then Radhika, Rick and I do. So there’s three segments. There’s this little spiel that I gave you here. I’m going to talk next to Anu Khan.
We’re going to talk about Searcy and her amazing work with her team, trying to just make sure that the science behind carbon removal standards is tight, that there’s Competition on the right things and not on the science. And then also moving into the historical episode that predated or was co-located in time, co-temporized. Okay, co-temporized with the launch of the direct air capture plus storage methodology. So I hope you enjoy. I think this is an important episode. It’s a nerdy carbon removal episode. Hardcore nerd, if you’re listening, you’re here because you love carbon removal.
And one other thing I’ll say too, is if you do love this show, can you please become a subscriber? Support the show. It’s $5 a month. The link is in the show notes at the very top. Please become a subscriber. Help us make more radio like this. We’re asking weird questions that maybe you’re not seeing other places. And thank you so much for everyone for being on the show. Thank you for listening. Give us a great rating and review in Apple Podcasts and Spotify. Thanks so much for listening. Have a lovely day.
And here’s my conversation with Anu. Hey Anu, thanks for being back.
Anu Khan: Thanks for having me. I love your show, so it’s exciting to be back on.
Ross Kenyon: Oh, that’s nice of you to say. Today, our goal is to explain how the direct air capture plus storage methodology of Nori that Nori made before it closed down ended up in a few places for preservation, for scholarly activity, for potential reuse in the future. And that was something that you did and part of the reason why your organization, Circe, was started and persists to this day. So Anu, can you explain how Cersei came to be? What does its name mean? What are you doing? How do you spend your time?
And thank you also for just making sure this methodology just didn’t vanish from the world. Thank you.
Anu Khan: Yeah, well, thanks for having me on the show to talk about our work. So the Carbon Rural Standards Initiative came out of my work when I was at Carbon 180. And at Carbon 180, I was on the science and innovation team and thinking a lot about MRV, as one does in the field of carbon removal. It’s kind of floating in the ether and always around. And I specifically was really interested in how do we build systems of accountability specifically for public policy? So if we are spending public dollars on CDR, how do we know that it is actually removing carbon from the atmosphere?
And that sort of whole line of work and thinking brought me to what is now the Carbon Removal Standards Initiative, or SEARC for short. Our mission is fundamentally about accountability. It’s making sure that whenever we’re doing CDR, particularly CDR that’s funded through policy, we are using science-based standards and regulations to ensure that we’re counting the carbon correctly. That’s kind of the short version, counting the carbon correctly standards.
Ross Kenyon: Interesting. There are many groups working on different approaches to MRV, some of which are commercial, some of which are non-profit. How do you imagine this ecosystem of various players working on standards in MRV and how do you think that you are doing something different?
Anu Khan: Yeah, so there is a lot of activity and I think in general this emphasis on MRV and rigor and Really working with the best available science is great and it speaks to the overall integrity of the carbon removal marketplace and ecosystem that everyone’s really trying to learn from what happened before in the kind of legacy voluntary carbon market and do something that is different and better. We focus on a very specific part of the challenge, which is standards and regulations for policy. So we So at Searcy, we provide technical assistance and capacity building for CDR policy NGOs and policymakers focused on quantification.
Again, making sure that anyone who’s working on CDR policy knows how to count the carbon correctly using the most recent evidence-based standards. In practice, that means we do four main things. The first is organizing information. By this I mean figuring out what already exists, who wrote it, who is using it, what are they using it for, and where are the gaps. And so we really want to have a sense of where is their consensus, where do we have disagreements, and where do we have nothing. And that kind of leads into the second activity, which is drafting guidance.
So if we don’t actually have a standard in this place, can we work with experts to draft something that will move the conversation forward? The third activity is kind of related to the second one, and that’s participating in standards development. A lot of CDR overlaps with other industries and other existing standards bodies and standards development processes. And so we don’t want to recreate the wheel. We want to participate in those processes and be a voice for civil society and policy development within those broader standards development efforts. So that’s something like the NIST CDR Consortium.
The fourth activity is catalyzing research. So as you know, CDR science is evolving rapidly. In some places, we just don’t have the evidence base to actually make industry-wide standards. It’s too early. And we want to support the research and the research plan to get to a place where you could actually have specific standards in the future. And so it’s not just research for the sake of research or like figuring stuff out. It’s really targeted towards how do we get from where we are today to the evidence base you need to develop something like an emissions factor that could be used in a greenhouse gas inventory.
So that’s the kind of a whole set of activities. But I think today we’re going to focus on the first one, organizing information.
Ross Kenyon: Yeah, I want to focus on me. It’s the topic that I care the most about. So Searcy now has the DAC plus S methodology from Nori in its first bucket. Why do that in the first place? It sounds like a very big spreadsheet and there’s a lot of data taken up trying to track all of those attributes to all of the data that you have.
Anu Khan: Yeah. So this is really the first thing that I did when I realized that kind of the thing that is now Searcy was on the horizon and I brought in a couple of really amazing consultants to essentially read and organize every single quantification resource we could find. This is voluntary carbon market methodologies, compliance market regulations, academic literature, and existing industry standards. Both the source documents but also breaking them down and looking at what other documents they reference and then going after those documents is kind of the underlying technical material, which we now organized and call our Quantification Resources Database.
It is a lot of information. It’s a lot of stuff. I think right now we have 498 source documents and 746 quantification resources across 167 unique carbon fluxes. So why do that? This is probably the obvious question. So this is everything that we at Searcy know about the state of quantification and CDR today. And we need this to be able to do our work to support standards development, to support the next wave of carbon removal policy. We need to know what are people actually using and where is their consensus in what folks are actually using today?
Where are we essentially pointing back to the same Underlying sources over and over again. So for example, in a lot of methodologies, they point back to the claim development mechanism and tools that were developed for that. So underneath, it’s kind of the same thing. And then at the same time, we want to know where they don’t point back to the same thing and what are the trade-offs that are being made there. So we can highlight those trade-offs for, again, policy NGOs and policymakers. So it’s not that you eliminate the trade-offs, you just make a more informed choice.
So the short answer to your question of why do we do this is to inform our own work, to be able to provide this technical assistance and capacity building around quantification standards. But we published it because transparency and particularly transparency around information sharing is really core to our mission. We think the whole ecosystem is better off if we’re super transparent about what information we have and what we’re using it for. The whole database is up on our website. You can poke around. You can search by pathway. You can see where specific information is inside of specific documents.
You can see the licenses that are associated with each document. And I’m really excited for other folks to poke around in the database and kind of see what they find and what they could use it for.
Ross Kenyon: The link is in the show notes. You should absolutely go in there and see and drown yourself in methodologies for days. Wow. What surprised you about it? Were there any groups that were really secretive about it that were as hard to get this information out there and publish it? What surprised you the most?
Anu Khan: What surprised me the most? I think The degree of consistency when you get really down to the nuts and bolts of breaking these large methodology documents down into their constituent pieces, there’s a few sources like clean development mechanism, ISO standards, in some cases like EPA guidance that recurs over and over again. And I think the really interesting thing about that, particularly from a policy perspective is We want to understand who’s the trusted technical authority for a policymaker and also more broadly for an industry. And so we got a lot of really interesting information about that.
Ross Kenyon: Wow. Some of what you said makes me think that you do not love the tendency towards making methodologies proprietary. Am I reading you correctly?
Anu Khan: I think it goes back to our question about tension. So I think the question of proprietary methodologies is an interesting one. And I should say this is one of the first questions that I had when we started building the database. It’s like, literally, am I allowed to do this? Can I pull this data in? And so we hired an IP lawyer to go through the database and see what we were allowed to share and all of that. And so that was an interesting process. And I think there’s a couple of things that emerged.
One is Very few of the items in the database cannot even be accessed. Pretty much everything, it’s a Creative Commons license that lets you look at it and read through it so you understand what this organization does. You might not be able to use the document yourself, particularly in a commercial entity, but you can see what they did. The second thing that emerged that was interesting was a lot of the Underlying technical guidance is available publicly. For example, again, Clean Development Mechanism, IPCC. So I think we’re actually a surprisingly transparent place compared to where my expectations were when we got started.
That said, I think there is a tension in the... Business model. If you are writing methodologies, you’re investing in it right now with the state of the science. It’s a pretty meaningful investment, I think, for companies. And so it makes a lot of sense that there would be a desire to protect that investment. So it may make sense. But I will say you can see all of the licenses associated with the source documents that we pulled for the database. And a lot of Creative Commons non-commercial. I forget what the exact string of letters and numbers is, but there’s one that’s by far the most common.
And I will also say there’s a lot of stuff in there that was developed by governments and that is open to use. And I think that can also be a resource for folks who are interested in a more open source approach or might not have the resources to kind of invest in an entirely new methodology. I think a lot of the Underlying components were developed by NGOs or multilateral institutions or governments.
Ross Kenyon: We had the coolest license though. You could use it for commercial purposes.
Anu Khan: That is incredible. And I would say based on what’s in the database right now, not that common.
Ross Kenyon: That’s cool. That was something I was really passionate about. I wish we could have seen what a world would look like if we were not competing on the level of methodologies. And that’s one of the reasons why I hope maybe the nonprofit standard setting organizations can become ascendant and have influence because it would be nice if we... I don’t know. Do we need pure and isometric methodologies for the same thing? Is that moving the ball forward in the way that we need it to be? Maybe that’s producing competition between them to not add things that are annoying to suppliers but do not add value to the buyers.
The competition might make them better. It might also represent a deadweight loss from duplicate work that confuses people and is not adding value. How do we know which is which here? Is there any way to know from Searcy’s work?
Anu Khan: So one thing that we think about a lot is case studies and precedent. I kind of expect that standards development and particularly policy and regulation for CDR will look like other things that already happened. The folks who are developing the policies, The folks who are in regulatory agencies, they’re going to think about what they’ve done, how similar CDR is to that, and they’re going to be looking at case studies and precedents, either intentionally or just kind of by default. And so I think a lot about what are the most relevant case studies and precedents and how do we pull that forward into our thinking about CDR.
One learning slash observation that I have, and I think it speaks to this sort of registry Competition, different standards, proliferation that we often talk about in the voluntary carbon market. A very similar thing happens in governments that jurisdictions, for a variety of reasons, will write their own version of a regulatory standard for their jurisdiction, even if the underlying science and content is quite similar to what a different jurisdiction would do. So for example, In Canada, there’s a federal offset system and then there are provincial ones as well, or emissions trading schemes.
And there’s California, there’s the EU. Those systems have their own protocols for that jurisdiction, but often there’s quite a lot of similarities between them. And this is true outside of the carbon context. It’s true for other types of standards as well. I think we should expect a certain degree of top level, this jurisdiction has their rulebook, this other jurisdiction has their own rulebook. What I’m interested in is the bottom-up approach. Are the sort of components, the science that’s informing the unique rulebook in this jurisdiction A and this one in jurisdiction B, is that the same?
Are we fundamentally doing the same thing to quantify the carbon? And I think we can get to that place. This is bonus content.
Ross Kenyon: No, this is the real content. This is going in the show. No, it sounds like you are saying then that there is some amount of variability that will exist between registries almost in perpetuity. It sounds like Puro and Isometric can both have a direct ocean capture Methodology or protocol. And they’re just going to be a little bit different because maybe they serve different purposes, different end uses potentially. And that might just be the future that we’re headed towards in the same way that Quebec and California, they both have emissions trading schemes, but they do it in different ways.
They’re idiosyncratic. Is that kind of what you’re saying?
Anu Khan: Yeah, I think that... In the long run, when we think about CDR regulation and standardization, it’s going to be heavily determined by what exists in policy and those policies across jurisdictions will be slightly different. Related to sort of what is being sought in those specific jurisdictions in the policy context, but we can ensure that the really basic components of how do we measure CO2 going from one place to another are fundamentally the same.
Ross Kenyon: I suppose that is probably what we intended in releasing a Creative Commons license methodology for commercial use and remixing was that others will want to take it and transform it and apply it in different ways in the way that we intended and supposed to be like a cairn left on the trail for others to follow and move us ahead in a new application of this rather than just to take it exactly as written and copy. That would have been fine for us too. That would have meant more eyes on it, giving us good notes and feedback.
But I think the intention was at least partially driven by riff on it. It’s not going to be right for every purpose and every registry and every user of it. Maybe that’s okay.
Anu Khan: Yeah.
Ross Kenyon: So can we ditch all the talk about harmonization? Was that a very 2024 thing and not a 2025 thing? We’re not there yet.
Anu Khan: I don’t think we’re there yet. I think that right now, market confidence and integrity is really important. We’re in a tough junction.
Ross Kenyon: Are you saying market confidence somewhere? Did you...
Anu Khan: no, we need it. Oh, yeah. Yeah, sorry. We’re in a tough spot right now. There’s all these great companies that are trying to do carbon removal. Market confidence that brings in buyers is important. And having a degree of harmonization and consensus and recognition of quality can be really valuable in that context.
Ross Kenyon: But you see harmonization not at the level of registries using the same methodology or protocol, but on relying upon the same basic level of standards and science. That’s what you’re pointing us towards.
Anu Khan: I see harmonization largely being driven by policy. I think U. S. states are going to be doing things as well. Canada, Japan, the EU, IPCC. I think there’s a whole bunch of different threads that are They’re loosely in the bucket of policy that will start to inform a picture of what is carbon removal and provide some clarity for buyers in the coming years.
Ross Kenyon: I see the most excitement about Japan of any of the groups that you’ve named, but maybe it’s just because it’s newer and it hasn’t been around long enough to disappoint us yet. There’s this need, like the compliance market in Japan, it hasn’t been around long enough for us to see the difficulties.
Anu Khan: Yeah, I think one of the biggest learnings I’ve had looking at standards development in other industries is that Voluntary consensus based processes are hard. And when you’re coming from an industry that’s a lot of startups, that’s a lot of move fast, prove this works, do the thing. If it doesn’t exist, do it yourself. That approach can be really valuable. It’s a little bit different from what is currently happening in large industry standards bodies and the work to build voluntary consensus based standards that are really broad based. And so when we do have some of these broader And efforts, some people are not going to be happy.
That’s kind of the nature of voluntary consensus building.
Ross Kenyon: Now, I watched especially the SBTI just sort of continues to take its lumps. But that position that they were in struck me as impossible. They were going to make someone angry no matter what. They’re going to Red Plus project developers angry because they said that’s not good enough to qualify for a negative emission. Like if you want to offset, you need to buy carbon removals or they were going to decide the other way. And then carbon removal people would say, why would you ever buy an asset two orders of magnitude more expensive when you can buy a Red Plus credit?
And it doesn’t seem like there’s a lot of middle ground in there for SBTI to hang on to. I don’t know how closely you watch that, but it seemed like those voluntary, quasi-regulatory organizations who are trying to set standards, you have to tell some people no. There is an answer that people do not want to hear, and you sometimes have to be the one to deliver it. And it is zero-sum at points. And it just strikes me as very painful and very difficult work.
Anu Khan: Yeah, I think consensus building in all contexts can be very painful and difficult work. And one of the interesting things about looking at this specifically from the lens of policy development is you sometimes have very clear precedents for certain pieces of things. Like, what are we trying to do here? You can, I think, in CDR drive towards A lot of specificity about what you’re using the carbon removal for. What is the purpose of this? And that will help resolve some of those difficult tensions.
Ross Kenyon: Well, thanks for being here, Anu. This is a very useful way of setting up some of the context that we’re going to be talking about in the main rest of the show. Always a pleasure to have you back on. Thanks for being here.
Anu Khan: Yeah, thanks for having me.
Ross Kenyon: Hello and welcome to the Reversing Climate Change podcast with Nori. I’m Ross Kenyon, one of the co-founders, Radhika Mugavkar. Radhika, you are the VP of Supply and Methodology and the host of our sister podcast, Carbon Removal Newsroom. Hello.
Radhika Moolgavkar: Hi, Ross. How are you doing?
Ross Kenyon: I’m great. You are the alumna of how many times on this? Four or five, six?
Radhika Moolgavkar: Yeah, I don’t know. Not six, maybe four.
Ross Kenyon: Maybe four. Okay. Rick Berg, who is the Director of Methodology here at Nori, this is your very first podcast experience.
Rick Berg: That’s right. Good to be here.
Ross Kenyon: Yeah. Radhika, what can we share with Rick to either make his journey easier or more difficult?
Radhika Moolgavkar: I don’t know. All we can tell Rick is to just roll with it because that’s how you and I podcast.
Ross Kenyon: Nori recently published our second methodology, or third, depending on how you count. If you can count the blended ton and our croplands methodology each as their own, then this is our third. If you don’t count blended ton, this is our second methodology that we’ve published. Nory just published a direct air capture and storage methodology, which is very exciting. It’s our first durable CDR methodology that we’ve created. Rick and Radica both worked very closely making this together alongside a panel of experts and public commenting. I have a lot of questions about what led to this methodology in particular being selected.
But I want to zoom out even further for the first question, which is why bother creating methodologies in the first place? Why should Nori even do this? Can’t you just pick one off the shelf somewhere else? Why do this difficult scientific work?
Rick Berg: Sure. So I can try and answer that, but I’ll take a step back first and kind of say, well, what is methodology? What’s methodology for? And it’s really a document that gets you, lays out all of the requirements to get from the project itself all the way through credit issuance. So it lays out all of the requirements for measurement, monitoring, reporting, verification. It lays out what happens If there is a reversal, if the CO2 goes back into the atmosphere, is there a buffer pool mechanism or is there an insurance mechanism to handle that?
Uh, what happens or emission displacement or what’s often called leakage, which are, you know, those CO2 effects outside the boundaries of the project. What, what do we do about those? And also environmental and social impacts and how those are assessed and what are the requirements around those. And so all of this is really meant to ensure the quality of the credits and make sure that a ton is a ton, essentially, and that there are no other kind of Adverse effects caused by the activity itself. And all of this speaks to kind of trust in the market.
Anybody that wants to buy any of these credits needs to be able to trust that ton, one is a ton, and it’s also not causing adverse effects on the environment or socially. And that’s one of the reasons why we write our own. So... One of the main reasons is to keep control over that quality and trust really at a fundamental level of the methodology and the credits coming out of Nori. So by creating our own methodologies, we are able to make sure that we’re keeping up with Not just keeping up with industry standards, but also looking for ways to improve them and innovate and kind of push the industry forward in terms of quality.
Right now, the industry is so early that’s really needed for a lot of these CDR activities. And the crediting mechanisms and the MRV and everything else around that. Hasn’t always been fully developed. These things will change over time, essentially. So we’re looking for ways to ensure the quality now and improve that quality going forward. So that’s certainly one reason why we create our own. Another reason would be to keep up with innovation. So there’s a lot of innovation in MRV or monitoring technology and things like that. Right now, and we’re always looking for ways to bring that into our methodologies.
And not just in terms of the MRV, but also other emerging kind of services within the CDR space that includes things like carbon insurance. And how do we incorporate that into methodologies as it’s emerging? And finally, I think just being Close to the suppliers themselves. So as we develop these methodologies ourselves and issue credits ourselves, that allows us to have closer direct relationships, a direct line of communication to the project developers on the ground. And that helps us look for ways to innovate more and improve in ways that makes their life easier while also keeping the quality and the integrity of the credits at a high level.
Ross Kenyon: Would Nori have just licensed or just reused a methodology from somewhere else? Would such a route even been possible?
Rick Berg: Not that I’m aware of, no. I mean, the other methodologies that are published out there from registries and such are not published under open licenses that allow any usage, certainly not commercial usage. And so that would create a difficulty there. Whether or not we can license it out, whether or not we can pay another registry to use theirs, I’m not aware of any that allow that.
Ross Kenyon: It might have given you a quicker time to deployment, but that wasn’t the only feature that we cared about. Radhika, how did Rick do? Do you approve of your colleagues’ comments here?
Radhika Moolgavkar: Yes, he did great. I mean, he is the creator of methodology, so he knows his business well.
Ross Kenyon: This part about proprietary methodologies is very interesting and important to me. I very much wanted us to release this new methodology under a very unrestricted Creative Commons license. And we ended up with, I’ll put in the exact license type, which is a string of letters that stand for various things, but it’s open. Nori’s methodologies are able to be forked. As is, and used by other registries, they can be forked and changed, and they can be used for commercial purposes. The only restriction that we put on them is that you can’t choose a different license type if you use the Nori source methodology.
You can’t, for instance, fork it, change something, and then patent it or put it under a more restrictive license. That is not something that would be tolerated under our Creative Commons license. I think it’s a really cool thing to do. When Nori started, we were looking at the legacy registries and we really didn’t like the model of having suppliers pay an enormous sum of money to develop them. And then once they were developed, they were often, you know, locked into that registry. It was not an affordable asset that was developed.
And since knowledge is effectively, once it’s produced, is effectively free to recombine and to duplicate, it has never struck me as an especially I think it’s something that is benefited from an open system where people can riff on it. They can make amendments to what we’ve done. We might even adopt those if they turn out to be better than what we’re doing. It allows for a much more I think transparent and flexible and democratic process for knowledge creation around carbon removal. I think I think that’s the hope is that over time, systems like this are more robust than if they’re proprietary.
I don’t know if either of you have any reactions to that. I imagine you probably feel somewhat similarly.
Rick Berg: Yeah, as you’re talking, it reminds me of, you know, open source software versus proprietary software and, you know, the security requirements. Improvements you get with open sourcing software and such. But going back to just carbon right now, the early stage of the market is really in need of innovation. And so right now it’s It’s really needed for folks to come up with new ideas, not just around MRB and around the technology and the methods and activities people are doing, but also with the crediting methodologies themselves and looking for the most efficient ways to incentivize the market to be able to issue credits rigorously and transparently.
I don’t think anyone’s fully figured it out, certainly not for every CDR activity that’s out there. And so right now, what is really needed is a lot of people with a lot of ideas and to eventually get toward harmonization of those ideas and the way that Like you’ve mentioned that Nori is kind of approaching that is by essentially open sourcing our methodology and allowing folks to take whatever pieces they think work well for them or to leave behind what is obsolete over the years.
Ross Kenyon: Curious what both of you think this harmonization process might look like. There’s a really strong chorus of people within carbon removal that are insisting that we need standards, we need clear guidelines, and I’m somewhat suspicious of this call. I don’t know that we’re ready. I think once any sort of, especially at the policy level, a government standard that has been issued, once people have a standard like that has to be followed or it’s strongly, strongly encouraged to be followed, Changing that I think will become quite difficult because people will have built businesses around that.
There’s going to be lobbying efforts around how those change or do not change. And we really don’t know as much as we would hope about what makes quality I think it’s easy to think of counter examples where you’re like, well, what about this? And I don’t want anything being codified that might have a Ross thought about it for 30 seconds. What about this? That is halfway compelling. That seems like something we’re not ready to enshrine and write on a stone tablet.
Radhika Moolgavkar: I think there’s a lot of thought going into this standards and approaches. I think what’s difficult more is the multitude of standards, which leads to nothing that’s uniform. And so from my perspective, having a government agency who lays out basic groundwork, if you will, of what it is to build the carbon removal industry is actually necessary. We need a foundation of some sort. And right now we don’t have it in a meaningful way, I don’t believe. And so then we get bogged down as an industry debating these crazy details that don’t allow us to be propelled forward.
So when I see what Europe’s doing, I kind of think it makes sense because they’re creating what seems like fairly broad frameworks that allow an innovation, but also provide enough of a basement that people know what they’re working within. What I see is the biggest issue for suppliers right now to adopting methodologies and also harmonization is nobody knows who’s going to win. So then they’re all trying to figure it out and they don’t even know how it compares to any standard at all. So I kind of have a different perspective from you than you from that.
I agree. We don’t want anything too proprietary or too detailed. But I do think some basic guidelines from a source that is irrefutable and you have You have to work with them like SB308 from California or something like that probably would do a lot to help clarify for suppliers who it’s quite frankly a struggle to work under all these various methodologies, which is something I think Rick and I are both acutely aware of after talking to suppliers about our DAC methodology. Like it’s a big lift to qualify. And so we need something that drives us all towards a single level.
And that might be the government or some other body.
Ross Kenyon: You disagree with me on my own podcast? Sorry. You dare to do this?
Radhika Moolgavkar: Who makes good radio?
Ross Kenyon: That’s what I was going to say, dude, it makes for better radio for sure when there’s some productive disagreement. I’m very cautious about the CRCF. I want to see what... But there’s going to be a lot of inertia that gets created based upon, okay, is permanence for a hundred years or a thousand years? And how does that shape what gets investment and what gets commercialized and what does not? If they’re going to say additionality matters a lot, what’s going to happen to the co-producers who are making hydrogen or making water?
Are they going to be cut out of this industry or are they not? I think things like that, they’re probably going to make at least one wrong call. And once it’s in law, then what? I doubt it’s going to change really fast.
Radhika Moolgavkar: But Ross, if it’s not in law, nobody’s doing anything. Like, I think that’s the other problem, right? Like nobody, there’s inertia already. That’s a real risk too.
Ross Kenyon: Right? Yeah. There’s trade-offs any way you go, for sure. I’m always like, they’re going to codify something and it’s going to get sticky. And then what?
Radhika Moolgavkar: That’s your libertarian worldview coming out. And I’m not in that perspective. And Rick is just laughing at us. So maybe we should move on.
Ross Kenyon: After I said, I prefer anarchy, I don’t know, there’s real cost to anarchy too. There’s this idea of the stationary bandit that Mancer Olson came across where he said that, look, governments all arise from predation. It’s basically just the strong rule when governments originate in history. But over time, expectations come around where they say every year at harvest time, we take a predictable amount. Would you prefer the predictable banditry of the stationary bandit like that? Or would you prefer just the anarchy of once in a while bandits who are uncontrolled by a state come by and raid your land?
He thinks there’s good reasons to prefer the banditry of the stationary bandit. Just for the predictability of it alone. So that’s a good case where even if laws are not perfect, it still might provide enough stability where good things can happen. And I think there’s something to that too. So I have my opinions, but I can also think of counterexamples like that too. I’m like, maybe that is better. What do I know? What is reality?
Radhika Moolgavkar: To your point, I think predictability allows other businesses to enter this market with a bit of confidence versus a Guardian article coming out and hammering them for what they thought was a You know, a generally acceptable and useful use of their dollars. And so having government sets and rules and standards, I think helps around that.
Rick Berg: I don’t have a whole lot to add beyond what you’ve both talked about already, except just again, going back to the stage of the market that we’re in, it definitely makes sense to standardize the methodologies and requirements over time. But right now, for me, the question is, is it the right time to do that? And I think a lot of these are in such early stages that it really does need more Experimentation within the markets, within the voluntary carbon markets before things do get codified because they will slow down at that point to some degree, of course.
But yeah, right now it’s a good time to experiment. And the voluntary carbon market so far in the U. S. at least has been, in my opinion, good at that in terms of technology, in terms of, you know, Providing incentives for people to develop new technology, but not yet write the standards for them that they have to meet to qualify for crediting, for example. But a lot of this will also, I think, eventually be driven by the Department of Energy in a lot of these cases. Who are now purchasing carbon credits themselves and under those purchases, they’ll have their own requirements.
And I think those will be such a large motivation for folks that probably a lot the standards will move toward those.
Ross Kenyon: I like that more indirect approach. I think procurement as a way of indirectly setting quality standards, I think is actually pretty smart because it also isn’t codified. It isn’t like you’re saying that in order to qualify as carbon removal, it has to meet the standard. It’s more if you want us as a customer and that will still probably drive a similar amount of change or convergence on that standard without it being written.
Radhika Moolgavkar: I don’t know. It’ll probably result in it being codified, right? Because they are doing these procurements to test stuff. And once they’ve come upon what they like, the Department of Energy, which might have a bias of its own, we don’t know. Those are administrative rules that’ll be written eventually. So it’s a slippery slope anyway if you dislike government regulation as soon the government starts getting involved because... Eventually, these will be written. And to Rick’s point, it depends where in the timeline you are in terms of innovation, whether it makes sense or not.
Ross Kenyon: Oh, yeah. I don’t just ipso facto. I just want to make sure. I think people are calling for it, not knowing that it’s going to be distorting. I think if you can go into it saying it’s going to be a trade-off and it’s going to penalize some and help others and we’re going to regret some of those trade-offs, I think that’s fine to say it’s still a mature, looking at this in a holistic way, it’s still worth doing. I just think people call for this without knowing there’s going to be some downsides to it too.
So as long as we can say that, I’m fine to shut up and move on about it. That’s okay. All right. So we’ve covered so much more than I even intended. And hopefully that’s good and relevant. I think these conversations are important. I think they don’t happen nearly enough. And that’s a big part of what we’re trying to do, I think, with both of our podcasts. So anyways, DAC, though, why direct air capture? There’s so many different... Families of methodologies and families of carbon removal technologies that we could have chosen.
Why go for direct air capture?
Radhika Moolgavkar: I’ll take that one, Ross. I mean, there were pretty good reasons why we chose direct air capture. That felt obvious at the time. One, as you and I both know, Nori has been doing soil organic carbon for a long time. And We at the time we were making the decision about DAC, there was a lot of concern that we were sort of being pigeonholed as a soil or agricultural commute company and not a more agnostic carbon removal company. And while we love our farmers and we love working with them, in the end, we’re a carbon removal company.
We’re a marketplace where, you know, integrated, vertically integrated marketplace. And so we wanted to demonstrate that. So we were trying to think of something about as polar opposite from soil organic carbon as you could get. And what’s more polar opposite than engineered solutions like DAC? The other thing that we were struggling with, with soil organic carbon, which is just the nature of the beast with only open source system, is that measurement and uncertainty around those, around the carbon removal, is very difficult to do accurately. So again, direct air capture offered the other end of the spectrum for that, where there are concerns and issues with direct air capture, but generally measurement is not, and the uncertainty of the measurement is not one of them.
And then finally, I think the other big issue that we struggle with in soil organic carbon, whether it’s appropriate or not, is this idea that the reversal risk is really high and you’re going to have farmers who just decide to till up their lands one day. And while I don’t agree with that and I don’t think we see that, that’s how the market perceives the soil organic carbon. And so we again wanted something that was directly polar opposite from that. And, you know, while there’s a reversal risk with direct air capture, With geologic storage, it goes down pretty quickly.
And, you know, we felt comfortable that people within the industry and current buyers feel like the reversal risk around DAC is low. So those are the main drivers. And then the final piece that was really interesting to us was the policy environment. As much as we maybe are anti-government sometimes, the policy environment here in the U. S. is just fantastic for direct air capture. There’s $3. 5 billion in DAC funding for DAC hubs, that sort of Made us feel comfortable that there would be a plethora of suppliers who were going to be stable in a way because they had government funding.
There’s also 45Q, which is another incentive that allows DAC suppliers to be more stable. And so it felt like when looking at all the different suites of solutions, DAC hit on a bunch of things that were important in the moment. And to be clear, that will not be the analysis we will use going forward because other things will be important and we’ll be thinking about other things. But that’s how we started with direct air capture.
Ross Kenyon: Anything to add, Rick?
Rick Berg: The point about there being a lot of potential suppliers is important. On a lot of the other durable methodologies out there, there’s not a lot of suppliers out there for them. You know, there’s some of them may only have one, many of them, many of them do only have one because they’re doing a, a, uh, certain flavor of, uh, enhanced weathering, for example, or something like that. Whereas most folks are spreading assault on agricultural fields. They may be doing something else that requires a completely, um, Custom-made methodology just for that.
And for a lot of the registries and such, it’s a big lift to put in all of the resources to develop methodology. And it’s a risk if there’s only one potential supplier for that who may or may not be stable down the road. So it’s an important consideration for the registries and the marketplaces as well in that sense.
Ross Kenyon: And you would say that director of capture companies are all broadly similar enough that a single methodology can, for the most part, stand and work without a lot of customizability?
Rick Berg: For the most part, yes. The biggest difference comes in the storage most of the time, where they can have geologic storage or they can be using the CO2 for storage. Making concrete or some other kind of product or something like that. So that’s, but by and large, you can cover many more potential suppliers with a direct air capture methodology than for most other types of methodologies you can write out there. I think at last count, there was over 150 direct air capture companies in the world already. And I don’t think anything else comes close.
Maybe biochar, I’m not sure.
Ross Kenyon: So how exactly does one go about creating a methodology? Is it you just sit down, you do desk research, you write documents and you publish it? Is there a lot of, do you have to wear a hard hat at any point? What do you actually do to make this thing?
Rick Berg: Well, there were no hard hats involved.
Radhika Moolgavkar: But we kind of wish there were, Rick. We’d take some field trips. So if anyone wants to give us a tour, we’ll take it.
Ross Kenyon: Marketing wants those photos.
Rick Berg: Go make it so. Reflective tests are, you know, appreciated. But beyond that, um, so developing a methodology is, so once we decide on a methodology to, uh, to pursue You start with background research. You start with really learning how it works, how the MRV works for the most part, but then everything else around it. What are the social and environmental impacts that are associated with these types of activities? What are the supply chain issues? If it’s a biker’s kind of project, where are they sourcing their... Are there large supplies of sustainable biomass for this particular CDR activity, that kind of thing.
So do all of that research, look and see what else is out there, how other folks have been approaching it. And then you start planning out how... How we want to design the methodology and start writing and, you know, continue. It’s very much an iterative process as you’re writing each section, you are going, you know, discovering questions that you may have not initially thought of, and you have to go back and do some more research to find out, you know, how, how do you address this particular MRV issue or something along those lines?
And, uh, Moving forward from there, so once you have a draft, you want as many people to review as possible, as many people who are very familiar with all aspects of methodology. And the first step in that is really the expert review process. So putting together an expert review panel is It’s a really interesting recruitment activity because you have to define all of the different types of expertise that you need to cover the methodology to get good input on all aspects that matter. And that’s everything from the technology to the storage to...
The different insurance or buffer pool mechanisms and social environmental impacts and policy issues and so on. So you really want to get a diverse panel together to review the methodology.
Ross Kenyon: Who’d you get for it?
Rick Berg: For our panel, we had a really great panel. We had a variety of researchers. So we had folks from Columbia and Arizona State University, Harriet Watt University out in Scotland. And so those folks were looking at things like the actual DAC process requirements and the storage requirements, the geologic storage requirements that we wrote into our methodology. And then for other aspects, one of the really fundamental pieces, especially with DAC and really any engineering process is the life cycle assessment. So this is what’s looking at all of the CO2 emissions or greenhouse gas emissions that are associated with every aspect of building and operating a project.
And we had Grant Faber on Uh, the panel to cover that aspect and he was, he was, he was great on the, on the panel, had a really substantial input and very glad to have him on there. And to cover policy issues, uh, Will Burns was on the, on the panel and he had good input on, you know, the environmental and social impact, uh, aspects.
Ross Kenyon: It sounds a little nepotistic though, Radhika. You can’t just ask your friends to be on.
Radhika Moolgavkar: Will’s too smart not to have on a panel.
Ross Kenyon: Was there more too that you wanted to say? That’s quite a cool list.
Rick Berg: There was one more. So one of the, previously I had mentioned carbon insurance is kind of an emerging topic within CDR. And we are looking for ways to incorporate that into our methodologies. So to that end, Tom Merriman from KETA. I was able to join the panel, and he also had really, really good input on not just the insurance aspect, but all of the potential liability and liability transfer issues.
Ross Kenyon: That’s one of the things that gets my nerd engine going. Go ahead, Radhika.
Radhika Moolgavkar: So, no, Ross, it’s funny you asked about us having friends on the panel, right? Because one thing Rick said, Didn’t mention as much, but when we first were walking through and designing the process, one of the biggest focus points was on transparency and accessibility. And we are a small industry, so we are friends with a lot of people, which is a good thing, but it’s also hard to have perfect objectivity and find people who have no How can one be transparent about an expert review panel like this?
Ross Kenyon: I imagine there’s Are they okay with everything they say being on the record and published? Is that something that’s tolerated typically in these spaces?
Rick Berg: So how we approached it, we wanted to be as transparent as possible while also allowing folks freedom to speak their mind, essentially, is so... To that end, we are publishing or we have published the minutes from the meetings and all of the changes that were made due to the expert panel review. So we have the, uh, Version of the methodology that we gave them. And then we have a marked up version, which includes all the changes that we made due to their comments. And then, of course, the next version that moves on to public commenting.
And then, so the meetings that we held with the expert panel, we wanted to provide the minutes from those meetings. One is a way to show people what we were talking about, but also to give Folks on the panel, if they had any objections to anything that was in the methodology or they wanted to get something on the record, let’s say, that was a spot to do it. And that’s the way that we are allowing that. But for their specific comments, we’re not publishing those just simply because we want to Give people the freedom, like I said before, to speak their mind in that review process and really get as much good input from them as possible.
Radhika Moolgavkar: And also before anyone, we explain this to anybody who we ask to be part of the export panel. So they had to be of a similar mindset as us that they were comfortable with. Allowing for this level of detail to be provided out to the public. So, I mean, I think that’s good news because everybody was very open to that and understanding the importance of providing that information more broadly and welcomed it.
Ross Kenyon: Makes sense. I think it’s a cool thing to do to publish minutes. Minutes seem like a good way to walk between those two extremes. Everything being on the record probably causes some amount of chilling because, I don’t know, if you know it’s going to be on the public record, you might speak a little bit more carefully, says someone who runs their mouth on a podcast all the time. Alternatively, if you don’t have anything public, who knows how decisions get made. That doesn’t feel like for an industry that needs trust, that probably isn’t helpful either.
So minutes sound like a good way to walk that line, I think. So okay, you get these notes from these experts that in their fields are well regarded and they know what they’re talking about. You get that sort of review. And then what?
Rick Berg: Yeah, we, we were very fortunate to get the kind of input we got from them. We got detailed input that in some cases took a lot of thinking to figure out how we address that in, in the methodology and how we, how we move forward on, on things. So it, it was a really good process. And after we got their input, uh, first we incorporated that in with, with a considerable effort. And then the next step is moving on to the public commenting period, which has just recently ended. And through that process, we were looking to get input from anybody who wanted to give input, but most of all potential suppliers who were on the ground actually building DAC.
Ross Kenyon: What’s it like to have suppliers involved in the development of one’s methodology? I could see them having very relevant experience, but people do worry that too much supplier involvement can lead to a race to the bottom. Like any business, they don’t want to necessarily do more than they have to. They want to make sure that they’re profitable and adding costs to them without a respective increase of price. Increasing the complexity of their operations is probably not always welcomed. So you don’t want them to drive too much. You want to make sure there’s an ability to scale here and get to volume because if we don’t have volume for carbon removal, basically nothing else matters.
So we need that, but it can’t just be anything goes either. So how does one find that right balance of supplier involvement and methodology development?
Radhika Moolgavkar: So I can start and let Rick jump in. But we debated whether we should have suppliers on the expert panel or not. And in the end, we decided, one, we didn’t want to look like we were favoring any supplier. And there are much fewer storage companies. We did have somebody associated with Zella on the panel. But there are a lot more suppliers. So we debated and decided against it. However, we did a huge push, which Rick can describe and go into more detail about, to try to get supplier commenting back.
Because I think we need suppliers to be on board with our methodology to make it do anything. Like, right, if a tree falls in the forest and nobody hears it, does it fall? You know, it’s the same idea. If we write a methodology and nobody wants to use it, then it’s not very useful. So that’s how we approached it at a high level. And I can let Rick talk about more of the details. I will say the common theme is we need harmonization. That’s what suppliers have been telling us pretty consistently.
It’d be really great if we could find harmonization in the methodology space.
Rick Berg: Yeah, absolutely. We’ve been hearing that quite a bit, and it’s certainly important.
Ross Kenyon: You’re talking about harmonization between the various registries and their respective methodologies?
Unknown speaker: Yes.
Rick Berg: Yeah, we’re certainly hearing that from suppliers. And to go back to... The question about having suppliers review the methodology and give input. So for that part, what we ended up landing on was Focusing on suppliers and public commenting and during that open public commenting period and through that public commenting period, we will be publishing all of the comments. So in that case, we’re having full transparency of all the comments that have been put in and all of the changes that are made due to those comments. So all of the supplier input that we get will be It’ll be open and transparent what we got and how we addressed it in the methodology.
But for the most part, or actually 100% of the time, we really haven’t gotten any input from suppliers where I have felt that they’re trying to put their thumb on the scale in any kind of way. In fact, kind of the opposite, we’ve gotten feedback from suppliers that they want The most rigorous, the most stringent methodology possible because they want to start at a high level so they don’t have to change so much over time, essentially.
Ross Kenyon: That’s interesting, because I could think of that point about the complexity of one’s operations, having to retool. I was wondering about this, too. I listened to a podcast with another registry representative on, and they were talking about how frequently they aim to update their methodologies. And there’s a real balance there, too, because if you’re a supplier and you have to keep track of methodology changes, and maybe that involves... Right. Right. Right. I think there is a real balance there for not making suppliers’ lives hell, but also making sure that this is something that is transparent.
So how are you going to think about moving forward? How often should Nori’s methodologies be updated? Should this be a really frequent, regular cadence? Should it be more irregular? What are you all thinking about that?
Radhika Moolgavkar: Well, I think that Rick and I haven’t yet agreed on anything, and it’s not because we disagree. It’s just that we don’t know yet what... To me, a methodology should be updated when there is a really good reason to update it. Like some sensor technology comes out that all of a sudden clarifies that this is the sensor and this is the ISO standard that everyone should use. Or verification gets to the point where we can write something very detailed about how verification should work. Right now, it feels very early for DAC to be in that place as we know 2024 and 2025 is where the vast amount of pilots will be happening.
So I feel like after 2025 into 2026, we might see some information. That being said, we will stand behind our current methodology and our hope is that if suppliers have to transition to a new methodology under us, It’s not too painful because we will be thinking about how we work with people who qualified under the old standard and how to grandfather them in. Because everybody’s writing this with the best of intentions, but it is so new that we expect change and we don’t want to harm our suppliers in any way as they evolve and respond to tech and the market.
Ross Kenyon: Is there anything I didn’t ask about that either of you would like to speak about here?
Radhika Moolgavkar: I mean, I think just one thing I’d like to highlight is like this was a really big deal for Nori. We for seven years or so have been cranking away in soil organic carbon sort of not and maybe is in the exact heart of carbon removal. And Dak squarely places us back in that world. And so I just want to take a moment to, you know, say it was a lot of work. It went really well. And it’s sort of is proof of concept that we can do quick, efficient methodology writing that I think is both rigorous and pragmatic.
And I think that’s the response we’ve gotten from people who have read it across various sectors within the industry. And so, you know, I think we should take a moment to just like celebrate that because that was a lot and it was a lot for a small team and we should be proud.
Rick Berg: And the, the one thing I’ll add is through how much thought we put into the process to really make sure we were being as transparent as possible through the process. Um, you know, speaks fully to trust, uh, how transparent we are and The really the only way to build that trust is through being completely transparent, but also clear and for folks to be able to understand what we’re providing to them. And that speaks more to accessibility and to be able to. Uh, understand the methodology and understand the process that went behind it and to see that entire process is fundamental to how we approached it.
And I think that’s the one other thing I would add to our, our general approach to the methodology development.
Ross Kenyon: I think the only part that we argued over in that was your use of the word stoichiometry. I think that was the only time that we quarreled where I was like, Rick, you’re like, there’s no synonym. There’s no suitable synonym for this. It has to be.
Rick Berg: We found one. I forget when it is, but we found one.
Unknown speaker: Incredible.
Ross Kenyon: Okay. Well, thanks. Thanks for doing this show. You both. I really respect both of your work on this. It’s a really huge project. I’m excited for what is coming, but also giving you some room to celebrate. There’s links in the show notes to so much of this. It entails...
Radhika Moolgavkar: As much, if not more work than DAC, but we think we’re going to come out with a whole different type of methodology that nobody’s seen in soil organic carbon. And it’ll be more rigorous, less uncertain. And most importantly, it’ll have soil sampling. So all the buyers who want soil sampling hopefully will be pleased. So that we can talk about in the fall, Ross, when we get a little closer to launching the methodology.
Ross Kenyon: Thanks you both for the work you do and have a great day. Thank you so much for listening. If you could please subscribe and give us a great rating and review on Apple Podcasts or a rating on Spotify, that’d be much appreciated. It helps us get our content out to more people. You can sign up for our newsletter at nori.com, follow us on social media, and we will catch you next time.
