Interactive explainer

What does it cost
to guarantee permanence?

A warranty fee, set against reversal risk, and invested to protect a carbon claim over the timescales that matter.

The fee is invested both in credits with diversified risk profiles and into financial markets — covering near-term losses today and compounding into a nest egg for the future.

The worked example

A conventional carbon credit portfolio consisting of forest credits, backed by a 15% buffer pool exposed to the same risks as the credits it is meant to protect. The question this tool answers: what fee, invested how, can replace that set buffer while covering the same — or more — of the underlying risk?

Portfolio size

58,000,000 tCO₂

roughly the Verra buffer pool

Credit price

$25 / tonne

working figure, high-quality forestry

A note on calibration

These warranty prices are rough illustrations. The "15% typical buffer" benchmark on this page follows Verra's convention — actual reversal-risk coverage depends on the underlying Carbon at Risk. As CaR is properly calibrated for a given portfolio, warranty fees may need to scale higher or lower. A recent paper by Wu et al. (2026) found current buffer pools to be undercapitalised by an average factor of 6.3×, suggesting warranty fees could plausibly rise by a similar factor (e.g., Central $6.25 → roughly $40/tCO₂) once properly calibrated.

Average Warranty fee $6.25 / tCO₂

Will be set by the Carbon at Risk of each project. Current prices assume reversal risk is adequately covered by a 15% buffer; fees will need to be higher if reversal risk found to be higher.

Investment into Forest vs Geological Storage iMore toward Geological: slower to reach buffer coverage, but the fund covers full portfolio replacement a year or two earlier because geological storage is already building up in the credit reserve. More toward Forest: hit buffer coverage sooner — the atmosphere is protected against short-term reversals without waiting to procure replacement credits — but portfolio replacement takes longer since no geological is built up in advance. 70% Forest

Trade-off between bigger contracted volumes and physical permanence today.

Annual deployment iLower deployment: full portfolio replacement possible sooner, but the credit reserve stays smaller — less insurance against reversals in the meantime. Higher deployment: full replacement takes longer, but the credit reserve grows faster and more effective carbon is delivered by fund end. 1.0%

Share of the fund spent each year on new credits. Too little sits idle; too much starves the fund of growth to buy more removals later.

Credits by Year 10

—

— of typical buffer

—

Credits by Year 40

—

— of typical buffer

—

Fund covers replacement of full portfolio with geological storage by

—

the year contracted durability becomes possible

See Contracted Durability (Healy et al., 2026) · Buffer Pools & Beyond (Gupton et al., 2026)

Fund vs. cost of coverage over time iThe Cost of full portfolio replacement (geological) line falls over time because geological storage prices are assumed to decrease with learning-by-doing and scale. In Advanced mode you can set your own cost trajectory.

Modelling done under central assumptions

Return on fund 6% per year Credit allocation today 50% of fee Geological storage price $1250 → $300 over 100 years Forestry price $25 → $181 over 100 years

Toggle any of these assumptions individually — including the geological price trajectory and the credit allocation split — in Advanced mode.

Cumulative carbon removals delivered by fund end (—)

—

— of the 58M tCO₂ initially contracted

Forestry — nominal · CaR ±60% (Lee et al., 2026) → — effective

Geological — nominal · CaR ±1% (Lee et al., 2026) → — effective

The Permanence Trust — being developed with AFF, Kita and CRS.

Open the full model →

Section 01 / The compounding reserve

A small fee, given time.

Apply scenario Sets every dial across all three sections

Dials Drag to model your own scenario

Average warranty fee $6.25 / tCO₂

Per tCO₂ warranty fee. Set by Carbon at Risk, not project economics.

Annual return on fund 6.0%

Realistic ESG fund range, 4–10% nominal.

Credit price inflation 2.0% p.a.

Forestry credits appreciate as supply tightens. Liability grows in step.

Premium collected up front

—

— at chosen fee

Fund covers 15% buffer at

—

— vs $217M (today) growing at inflation

Fund covers full portfolio at

—

— vs $1.45bn (today) growing at inflation

Early years — where the lines cross

Full 100-year view — the fund keeps compounding

—

Section 02 / Why you need credits too

An uncorrelated buffer pool.

Geological storage prices are assumed to fall over time — learning-by-doing, scale effects, and technology maturation. Drag the curve below to set your own trajectory.

Premium

—

Warranty fee

—

Annual return

—

Credit inflation

—

Scenario

Geological storage price trajectory Drag the dots to set your view

—

Split the credits

Share of fee spent on credits today 50%

The rest compounds in the fund.

Forestry share of that spend 70%

Cheap today but exposed to the same reversal risks as the pool. Higher = more climate action now, less future protection.

Credits bought today

—

Share of buffer covered

—

— of 2024 global geological storage contracted

Contracted durability achieved at

—

vs Section 01 alone: —

—

Section 03 / Capital ↔ reserve

The deployment rate.

Premium

—

Allocation today

—

Annual return

—

Credit inflation

—

Scenario

Annual deployment rate

% of reserve deployed each year 1.0%

Each year: reserve earns return, then a slice is taken out to buy credits at that year's price.

Credits cover buffer at

—

cumulative physical retirement hits 8.7M tCO₂

Credits cover full portfolio at

—

cumulative physical retirement hits 58M tCO₂

The contracted durability point

—

fund + geological credits held can fully replace the portfolio in durable storage

Tonnes built up vs reserve-swap potential, over 100 years

—