How does the 45Q tax credit work after the 2025 law?

45Q is a US tax credit per tonne of CO2 captured and then stored or used. It pays up to $85 a tonne for capture at a plant, under wage and apprenticeship rules. Direct air capture earns up to $180. A law signed on 4 July 2025 gave CO2 used in products or oil fields the same rate, for new equipment. Under IRS rules, construction must begin before 2033. This isn't tax advice.

Which carbon capture companies have closed rounds in 2026?

Reverion raised a $175 million Series B in 2026, led by Kembara. Vaulted Deep took a $35 million debt facility from Mediobanca. At the early end, Azolla Ventures led a pre-seed round for Mafix. The biggest cheques go to companies with buyers signed or a plant site ready. CDR.fyi tracks new rounds and purchases each month.

Why are people against carbon capture?

Critics point to cost and a patchy record. The Congressional Budget Office found that most large US demonstration projects funded in 2009 were never finished. It also found that almost all operating US capture plants supplied their CO2 for oil recovery. Others fear capture delays cutting emissions at the source. Buyers such as Frontier now buy only permanent removal, vetted by scientific reviewers.

How do carbon removal purchase deals like Frontier work?

A group of buyers commits money early, so suppliers can raise and build. Frontier's members, including Stripe, Google and Shopify, have committed $1.8 billion to permanent removal by 2040. Early teams can win a prepurchase, paid before any tonnes arrive. Larger suppliers sign offtakes of $10M to $50M, paid when tonnes are delivered. Banks are starting to lend against such contracts.

How much does help with a carbon capture raise cost?

Our fees are flat and agreed before work starts. An investor deck starts from $6,000, a financial model from $3,000 and a valuation from $5,000. There is no success fee on advisory work. For selected clients we make warm introductions from our 200+ VC relationships. Introductions are never guaranteed, and we are not brokers. See pricing.

Home / ClimateTech / Carbon Capture

Industry: Carbon capture

Funding for carbon capture startups

Carbon capture and removal companies raise from specialist VCs, buyers who prepay for tonnes, lenders and governments. We turn your cost per tonne, buyers and plant plan into a deck and model investors can test.

Decks and models that price every tonne and every plant
Investor lists from removal specialists to project lenders
Waveup prepares investor materials for carbon capture companies: $3B+ raised for 600+ startups since 2014

Talk to us about your raise See related cases

In short

What is funding for carbon capture startups?

Funding for carbon capture startups is the money behind capturing, removing, storing or using CO2. It mixes venture capital, grants, tax credits and prepaid contracts from buyers of carbon removal. The IEA puts 2025 investment in carbon capture projects at over $5 billion. Venture money fell that year, so investors now check buyers first.

Who it's for: Carbon capture, carbon removal and CO2 storage companies, pre-seed to Series D+
What we build: Investor deck, financial model, valuation, investor list, data room
Prices: Deck from $6,000, model from $3,000. Flat fees
Track record: $3B+ raised for 600+ startups since 2014

Market data checked on 8 November 2026. Sources are under each section.

Do investors still back carbon capture startups in 2026?

They do, but fewer funds are writing cheques. Most now want a signed buyer for your tonnes before they lead a round.

The opportunity

Buyers, lenders and governments now pay for captured and removed CO2, not only for research.

Tech companies sign multi-year contracts for permanent removal
CO2 storage is becoming a service that capture sites can buy
US tax credits and European support schemes pay per tonne stored

The problem

Venture capital for carbon capture fell 60% in 2025, the IEA found. Investors moved money to AI as climate policy became harder to predict.

Sources: IEA, Financing CCUS at Scale, 30 Mar 2026 (venture capital, policy, support schemes); Global CCS Institute, Global Status of CCS 2026, Oct 2026 (storage as a service).

Market size

How fast is carbon capture spending growing, and why?

Investment in carbon capture projects grew from about $0.3 billion in 2020 to more than $5 billion in 2025. The money comes from four places:

Project lenders: banks lent more than $15 billion to carbon capture projects in two years
Shared CO2 networks: transport and storage projects make up 32% of the global pipeline
US tax credits: 45Q pays up to $85 a tonne for CO2 captured at a plant and stored
Removal buyers: Frontier's members have signed $679 million of carbon removal contracts

Commercial CCS projects in the 2025 and 2026 reports: 77 and 113 operating, 47 and 59 in construction. In development: 297 and 308 advanced, 313 and 352 early.

Sources: IEA, Financing CCUS at Scale, 30 Mar 2026 (investment, debt, 45Q); Global CCS Institute and its 2026 executive summary, Oct 2026, data to 31 Jul 2026 (networks and chart); Frontier dashboard, updated Oct 2026.

Carbon capture in 2026, in six numbers

68 Mtpa

of CO2 capture capacity was running at commercial projects in mid-2026, up 6% in a year

30+

carbon capture projects reached a final investment decision in the past two years

$50B+

of public support was earmarked for carbon capture projects over three years, a record

$180

a tonne is the top 45Q credit for direct air capture with storage, under wage and apprenticeship rules

50.6M t

of durable carbon removal has been contracted by buyers so far

1M t

of carbon removal Google agreed to buy from Terradot in September 2026

Sources: Global CCS Institute, Global Status of CCS 2026, Oct 2026; IEA, Financing CCUS at Scale, 30 Mar 2026 (decisions, public support, 45Q); IRS, Instructions for Form 8933, Rev. Dec 2025; CDR.fyi, opened 8 Nov 2026, and its September 2026 recap, 6 Oct 2026.

Venture capital

Which carbon capture pathways draw venture money?

Venture capital for carbon capture grew about sevenfold from 2019 to 2024, the IEA found. Engineered removal, such as direct air capture and BECCS, has drawn most of the private money.

Private funding for carbon removal to date: about $4.1B for direct air capture and $3.7B for BECCS. Biochar and enhanced weathering drew about $0.4B each.

~40%

of private money for carbon removal so far came from venture capital firms

$175M

Series B for Reverion in 2026, led by Kembara; its power plants capture CO2 for storage

$35M

debt facility for carbon removal company Vaulted Deep from Mediobanca in 2026

Sources: IEA, Financing CCUS at Scale, 30 Mar 2026 (growth since 2019); World Economic Forum with Oliver Wyman, Carbon Dioxide Removal Technologies, Mar 2026 (chart and VC share); CDR.fyi, September 2026 recap, 6 Oct 2026 (Reverion, Vaulted Deep); Reverion, opened 8 Nov 2026.

Who invests in carbon capture startups?

Carbon removal specialists, climate funds, buyers who prepay for tonnes, and public money for projects. One name per type below. The 20 funds in our climate tech VC funds guide add more names.

Counteract

Carbon removal VC, London

CREW Carbon, Cella, CarbonRun

Pre-seed and seed

Azolla Ventures

Climate VC set up by Prime Coalition, Cambridge, Massachusetts

Mafix, Calcarea, Oxylus Energy

Earliest stages

Extantia

Climate tech VC and fund of funds, Berlin

Phlair, RepAir, Reverion

Not stated

Frontier

Buyers' advance market commitment of $1.8B to 2040, from Stripe, Google, Shopify and others

Offtakes with CO280, Vaulted Deep and Lithos

Prepurchases of ~$250K–$1.5M; offtakes of ~$10M–$50M

UK government

Public support for the first two capture clusters, UK

East Coast Cluster, HyNet

Up to £21.7B over 25 years (Oct 2024)

Sources: each investor's website, opened 8 Nov 2026: Counteract, Azolla Ventures, Extantia and its imprint, Frontier and its purchase tracks, UK government, 4 Oct 2024. Companies named are examples, not full portfolios. Search investors by sector in our investor database.

Investor database

Cleantech investors in our database

The funds with the most cleantech investments. Pick a stage, or open a fund for its cheque sizes.

Top 5 by cleantech investments

Investments by industry
Energy & Utilities30%
CleanTech & Sustainability16%
Hardware. Robotics & IoT11%
Rounds
Pre-seedSeedSeries ASeries BSeries C+
Average cheque
$3M–$10M
Based in
New York, United States
Invests in
Europe, USA
151 investments in total, 19 tagged CleanTech & Sustainability.Open the full fund profile
Investments by industry
Energy & Utilities35%
CleanTech & Sustainability16%
Natural Resources8%
Rounds
SeedSeries ASeries BSeries C+
Average cheque
$100K–$500K$500K–$1M$1M–$3M$3M–$10M$10M–$50M
Based in
Paris, United States
Invests in
Europe, USA
213 investments in total, 15 tagged CleanTech & Sustainability.Open the full fund profile
Investments by industry
Energy & Utilities24%
CleanTech & Sustainability16%
Hardware. Robotics & IoT11%
Rounds
Pre-seedSeedSeries ASeries BSeries C+
Average cheque
$0–$100K$100K–$500K$500K–$1M$1M–$3M$3M–$10M
Based in
Chicago, United States
Invests in
USA
148 investments in total, 14 tagged CleanTech & Sustainability.Open the full fund profile
Investments by industry
Energy & Utilities21%
CleanTech & Sustainability17%
Hardware. Robotics & IoT13%
Rounds
Series ASeries B
Average cheque
$0–$100K$100K–$500K$500K–$1M
Based in
Honolulu, United States
Invests in
USA, Canada
214 investments in total, 12 tagged CleanTech & Sustainability.Open the full fund profile
Investments by industry
Energy & Utilities32%
Natural Resources20%
CleanTech & Sustainability16%
Rounds
SeedSeries ASeries BSeries C+
Average cheque
$0–$100K$100K–$500K$500K–$1M$1M–$3M$3M–$10M
Based in
Boston, United States
Invests in
USA
59 investments in total, 12 tagged CleanTech & Sustainability.Open the full fund profile

See all cleantech investors Read our guide: Top 20 Climate Tech VC funds

From our investor database.

Why do carbon capture startups struggle to raise?

In our Fundraising 2025 study, 56 VCs named revenue growth, unit economics, burn and missed milestones as top reasons to pass. Defensibility and crowded categories came next. Carbon capture founders also face four questions about tonnes, plants and policy.

Selling tonnes before you deliver them

Offtake buyers pay when verified tonnes arrive, and deliveries trail sales. Frontier's suppliers have delivered about 5% of the tonnes they have sold.

What investors ask

When will your verified tonnes arrive, and how many each year?

What your deck shows

A delivery schedule for each signed contract
Your measurement method and who verifies it

The missing middle

Removal projects costing $10 million to $100 million are often too big for venture funds and too unproven for project finance. The IEA calls this the missing middle.

What investors ask

Which backers will pay for your first commercial plant?

What your deck shows

The plant's capital stack: equity, grants, loans and prepaid tonnes
What this round proves before the plant round

Rules that change mid-build

A US law signed on 4 July 2025 changed the 45Q credit and barred some foreign-controlled companies from it. The Energy Department has also cancelled its environmental review of Project Cypress, a Louisiana air capture hub, citing project changes.

What investors ask

If 45Q or a grant changes, does the model still hold?

What your deck shows

Margins per tonne with and without tax credits
Who claims the credit, and who carries the risk

A high cost per tonne

Direct air capture costs $500 to $1,200 a tonne, the most of any removal pathway. Buyers can find biochar tonnes for much less.

What investors ask

How far will the cost of a tonne fall by your tenth unit?

What your deck shows

Your cost per tonne today, at the first plant and at fleet size
Energy use per tonne, and what that energy costs

Sources: Frontier dashboard, updated Oct 2026 (the 5% is our arithmetic on its 91,837 tonnes delivered and 1,835,427 contracted); IEA, Financing CCUS at Scale, 30 Mar 2026; IRS, Instructions for Form 8933, Rev. Dec 2025 (Public Law 119-21, in force); US Department of Energy, opened 8 Nov 2026 (review cancelled; the page gives no date); World Economic Forum with Oliver Wyman, Mar 2026; our Fundraising 2025 study.

How we help you raise

Flat fees agreed before we start. No success fee on advisory work.

Your cost per tonne, buyers and plant plan, in the order investors check them.

Revenue per tonne, capex per plant, and cases with and without 45Q.

A range tied to recent removal rounds and the contracts you hold.

Removal specialists, climate funds, corporates and project lenders that fit your stage.

Measurement methods, offtake contracts and storage permits, filed for review.

For a sale, a project partner or an infrastructure fund's review.

Who we are

Waveup is a London-based fundraising and growth advisory, working in 60+ countries and 90+ industries. Since 2014 we have built the decks, models, CIMs and valuations behind $3B+ raised for 600+ startups. Our work includes 54+ deep-tech projects across 10+ verticals.

About us

Track record

$3B+

raised for 600+ startups

Decks

1,000+

decks since 2014

M&A

50+

M&A transactions supported, including 20+ exits

Energy and climate

of our projects on record are in energy and climate