Four new companies have committed $100 million to remove carbon dioxide from the atmosphere as part of an effort started by several major tech companies to jumpstart the nascent carbon dioxide removal industry.

Autodesk, H&M Group, JPMorgan Chase, and Workday announced on Wednesday a combined $100 million commitment to Frontier, a benefit company owned by payment processor Stripe. That adds to the $925 million announced in April 2022 from Stripe, Alphabet, McKinsey, Meta and Shopify at the launch of Frontier.

Frontier helps its member companies purchase CO2 removal via pre-purchase agreements or offtake agreements. The goal is to spur the development of a new industry by providing a novel source of funding that isn’t based on debt or equity investments, but on actual product purchases before the technology is fully available at scale.

“We see Frontier’s advanced market commitment as an important demand signal boost for the carbon removal market. It’s critical for demonstrating that there is a customer for entrepreneurs building carbon removal solutions,” Ryan Macpherson, the climate innovation and investment lead at Autodesk, told CNBC.

Stripe began purchasing carbon removal in 2019 when the payment processor said it would spend at least $1 million per year removing carbon dioxide from the atmosphere and sequestering it for long-term storage.

Stripe’s relatively early decision to focus on carbon removal was “an effort to really focus our climate program where we felt like we could have meaningful climate impact,” Hannah Bebbington, the strategy lead at Frontier, told CNBC.

“Permanent carbon removal is categorically under-invested in and under-supported despite the fact that we know through IPCC reports that we’re going to need billions of tons of annual capacity in the coming decades. And so really, Frontier is an extension of work that we’ve been doing in permanent carbon removal for many years,” Bebbington told CNBC.

The latest report published in March from the United Nations’ Intergovernmental Panel on Climate Change talks about the value that carbon dioxide removal has in responding to climate change. The IPCC emphasizes throughout the report that the primary and most important factor in mitigating the negative impacts of climate change is reducing emissions, but also says that carbon removal technologies can help if used strategically.

Carbon dioxide emissions from energy production topped 36 billion tons last year, according to the International Energy Agency, with total global carbon dioxide emissions projected to have been 40.6 billion tons in 2022, according to the Global Carbon Project.

Frontier’s member companies tell Frontier how much money they want to spend and over what timeframe. Frontier then decides how to allocate that capital to carbon removal companies in its portfolio. Member companies generally sign up for multi-year commitments amounting to “tens of millions of dollars,” Bebbington told CNBC, but smaller companies can contribute through a deal between Frontier and carbon accounting firm Watershed. Firms like Aledade, Boom Supersonic, Canva, SKIMS, Wise and Zendesk have all bought into Frontier via the Watershed partnership.

All of the CO2 removal solutions funded will have to meet specific criteria including permanence (more than 1,000 years), cost (with a viable path to costing less than $100 a ton at scale), additionality (meaning they’re not removing CO2 that would have been removed or reduced through some other method anyway), and capacity (more than 0.5 gigatons of carbon per year at scale).

So far, Frontier has spent $5.6 million buying nearly 9,000 tons of contracted carbon removal from 15 carbon dioxide removal startups that are collectively pursuing seven methods.

For example, Lithos spreads basalt on croplands to increase the carbon that dissolves in the soil. RepAir uses electrochemical cells and clean electricity to capture carbon dioxide from the air. And Living Carbon is a synthetic biology startup working on engineering natural systems to remove carbon dioxide.

Each of these startups has a different delivery schedule and different deadlines, all of which are made public on Github.

All 15 startups Frontier has listed on its website so far have received money through pre-purchase agreements, which are relatively small-scale checks, often $500,000, going to very early-stage companies. Pre-purchase agreement money is delivered upfront and is not conditional on delivery, and Frontier is not getting equity in the startups.

Frontier will also fund a second category called offtake agreements with carbon removal companies that are further along in their development and scale. In an offtake agreement, Frontier will pay as the carbon removal is delivered.

Offtake agreements will comprise “the lion’s share of the funds from Frontier,” Bebbington said, but the companies delivering those offtakes have not been announced yet.

Corporate partners can choose to fund only offtake agreements and opt out of the pre-purchase agreements. So far, only Stripe and Shopify have elected to participate in these pre-purchase agreements, but as Frontier members “get comfortable with buying early-stage carbon removal, we expect many more will participate in pre-purchases as well,” Bebbington told CNBC.

Critics say that focusing on carbon capture is a distraction to the primary goal of reducing greenhouse gas emissions, the fundamental solution to addressing climate change.

“We have to shift the narrative as a matter of urgency. Money is going to flood into climate solutions over the next few years, and we need to direct it well. We must stop talking about deploying CDR as a solution today, when emissions remain high — as if it somehow replaces radical, immediate emission cuts,” wrote David Ho, a professor of oceanography at the University of Hawaii at Manoa, in the journal Nature on April 4.

But Frontier says that both emissions reductions and carbon dioxide removal are needed.

“It’s pretty unequivocal when you read the IPCC reports starting in 2018, that we cannot get to net zero global emissions without permanent carbon removal at scale. And so to us, it is a false dichotomy” to compare carbon dioxide removal with emissions reductions, Bebbington told CNBC.

“We need to both radically reduce the emissions we emit, but also scale high-quality permanent carbon removal, because, without those, we will in no way reach that net-zero goal,” Bebbington said.

Autodesk agrees.

“To be clear, carbon removal isn’t the end-all, be-all solution to climate change. It’s far from it. At Autodesk we’re supporters of a wide range of mitigation strategies and technologies to avoid and reduce greenhouse gas emissions and accelerate the broader transition to decarbonization. All that difficult decarbonization work needs to happen prior to removing CO2 from the atmosphere,” Macpherson told CNBC.

“However, the science is increasingly clear: Carbon removal is an increasingly necessary tool for limiting warming. The challenge is that many of today’s removal solutions are still nascent, and we’ll need to scale the industry thousands of times over if we’re to meet the scale necessitated by climate models.”

Workday also says carbon removal is one component of its larger climate change strategy.

“This partnership is one aspect of our overall climate action initiatives, which includes matching 100% of the electricity used at our global offices and data centers with clean, renewable sources and providing our entire customer community with a carbon-neutral cloud,” Rich Sauer, Workday’s chief legal officer, told CNBC.

“However, we understand that permanent carbon removal is needed to achieve net zero targets by 2050 and that requires significant development to ensure emerging technologies in this space are in place quickly so this important work can be done at scale,” Sauer said.