Skip to main content

Execute the Purchase

Once a supplier has been selected, the contract becomes the central document that defines what you are buying, how it will be delivered, and what happens if expectations are not met. Carbon removal contracts carry unique features compared with traditional procurement, including future delivery, verification dependencies, permanence obligations, and integrity safeguards.

Core Elements to Understand​

  • What you're buying: The contract defines the quantity of credits, delivery schedule, and whether credits will be transferred to your registry account or retired on your behalf. Suppliers are prohibited from selling the same credits to another party.

  • Price and payment: Pricing is set per credit. Payment timing is negotiable — on delivery, on invoice, upfront, or prior to the project's commercial operations date. Clarify who is responsible for verification and registry fees.

  • MRV and verification: The supplier must maintain a monitoring, reporting, and verification plan in line with the applicable carbon standard and registry. The buyer receives quarterly project status reports and has audit rights during the durability monitoring period.

  • Shortfall remedies: If the project under-delivers, the contract should define what happens — typically, makeup deliveries in future years, replacement credits from comparable projects, or price adjustments.

  • Termination and default: Covers what triggers exit rights, cure periods, and remedies. Force majeure and changes in law are especially relevant given CDR's long contract horizons.

  • Representations and warranties: Suppliers warrant project registration, verified removals, clear title, and no material social, environmental, or human rights risks. Buyers warrant credits will be used for voluntary purposes only.

Introducing OSCAR​

To support buyers in navigating these complexities, CDR.fyi is hosting the Open Standard Carbon Removal Offtake Agreement (OSCAR). For more information on contract elements, clause-level explanations, drafting rationale, and negotiation guidance, please refer to the OSCAR section and the OSCAR Guidebook.

Note: the Guidebook is explanatory only. It is not legal advice and should not be relied on as such. Parties considering entering into CDR credit transactions should consult qualified legal counsel.

Explore the Portal