Up to now we have seen AMR as a supplier in the negative emissions market, where methane emission certificates would be traded for methane removal certificates, very much like the CO2 emission market works. However the bulk of methane emissions we want to remove is already up in the atmosphere, so there would be no counterparty for these “legacy emissions”.
We have now found a solution which ensures an income for AMR, but also takes into account the historic or legacy emissions.
AMR will sell emission certificates on the market at market prices. However, when AMR sells one ton worth of methane removal, it will actually remove AF tons of methane. AF stands for the “AMR-Factor” which will be calculated from the actual cost of methane removal and the current price.
This calculation works as follows.
Cost of one ton of methane removed = C (Actual Cost for AMR to remove 1 ton of methane)
Price for one ton of methane removed = P (Current price on the emission rights market, which will in future feature methane removal certificates)
AMR Factor AF = C/P. The factor is the quotient of Cost and Price.
For example:
P = 200,00 USD
C = 0,80 USD
AF = 200,00 / 0,80 = 250
In this case AMR would remove 250 tons of methane for 1 ton of methane traded on the emission rights market.
