Engineered Carbon Removals: A Fast-Growing but Early-Stage Pipeline
Engineered carbon-dioxide removal (CDR) needs to scale by orders of magnitude this decade to play a meaningful role in the net-zero transition. Whether enough early-stage development activity is building to support that scaling is a central question for the sector. MSCI Carbon Markets’ newly released off-registry dataset may help answer it, by tracking 176 unlisted projects categorized as direct air capture (DAC) and bioenergy with carbon capture and storage (BECCS).
The picture is encouraging in scale but measured in substance. Stated capacity across projects reporting a capacity figure reaches into the tens of millions of tonnes of CO2 per year, compared with the 4.5 million tonnes captured by the minority of projects operating today. But most of the pipeline remains concentrated in the earliest stages. Around 16.2 million tonnes of potential supply sit in announced and planned projects alone, several times the volume currently under construction. Progress at these stages depends on regulatory frameworks that are still evolving and capital that has yet to be committed.
DAC and BECCS: Different paths to scale
The two technologies are following different paths. BECCS is overwhelmingly removal-oriented, with 88% of projects designed to deliver commercial-scale carbon removal. DAC presents a different picture. With 60% of projects focused on developing and testing the technology rather than delivering removals, most DAC projects remain in the research phase.
While that research base has value, it also suggests that DAC remains less commercially mature than BECCS. DAC’s long-term removal ambitions will depend on further technical progress.
For institutional investors and carbon-credit buyers, the takeaway is that the sector shows clear early-stage momentum but meaningful execution risk. Most projects remain at stages where development hurdles are highest, and many rely on technologies that have yet to reach commercial scale.
MSCI Carbon Markets off-registry dataset, 2026. Covers 176 DAC and BECCS projects that were neither in the pipeline nor registered as of June 2026.
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