SAO PAULO/LONDON (Reuters) -McLaren Racing has agreed to purchase carbon credits from reforestation projects in Brazil's Amazon rainforest and CO2 removal initiatives in Britain and the U.S. as part of its bid to achieve net zero emissions by 2040, the team said on Thursday.
McLaren competes in Formula One and the IndyCar Series, with emissions coming - in addition to motor racing itself - from activities such as air travel, with Formula One set to race 24 times in 22 different countries next year.
One of the deals was to buy carbon removal credits from Brazilian startup Mombak, which reforests degraded land in the Amazon, while a second one involves Scottish firm UNDO, removing CO2 from the atmosphere through enhanced rock weathering.
McLaren also said in a statement it was partnering with the Great Barrier Reef Foundation, an Australian non-profit that works to restore coral reefs. Australian Oscar Piastri drives for the team in Formula One.
Britain-based McLaren aims to reduce its emissions by 90% by 2040. For the remaining 10%, it would implement initiatives such as carbon offsetting. It did not disclose how much it was investing in its new 'Climate Contribution Programme'.
"A big part of that is making sure that we reduce emissions across all our operations and supply chain," the team's director of sustainability Kim Wilson said of the 2040 net zero goal.
"But we know that's not enough. We also have to do something about the existing carbon in the earth's atmosphere."
Mombak told Reuters that under their deal it would deliver McLaren removals from 2023 through 2025 at an average price of more than $50 per metric ton, a premium over the traditional carbon credit market.
Carbon credits are tradable permits that allow the owner to emit certain amounts of greenhouse gases, with each credit permitting the emission of one ton of carbon dioxide.
"Carbon credits above $50 are the big news," Mombak co-founder Peter Fernandez said in an interview. "That's a new level. In Brazil some people still think carbon credits are worth $5, $10, $15 - that's no longer true."
Mombak, which buys degraded land from farmers and ranchers or partners with them to replant native species in the world's largest rainforest, is backed by investors such as Bain Capital and AXA.
It recently raised a $100 million fund to build carbon removal projects in the Amazon, with money from Canada's CPPIB and the Rockefeller Foundation, and said it hopes the McLaren deal will help shape Brazil's nascent carbon removal industry.
"This goes to show that the world is willing to pay more. It's not possible to carry out ecological restoration with just $20 per ton," Fernandez said. "It is with a price like this that a company like ours can scale the Amazon reforestation."
Critics of carbon offset markets, including Greenpeace, say they allow emitters to continue to release greenhouse gases.
(Reporting by Gabriel Araujo in Sao Paulo and Alan Baldwin in LondonEditing by Toby Davis and Christian Radnedge)