Canadian carbon removal developer Deep Sky has signed a 10-year carbon dioxide removal (CDR) offtake agreement with TD Bank Group. This marks a significant step in the development of Canada’s emerging carbon removal industry. Under this agreement, TD will purchase over 18,000 carbon removal credits generated by Deep Sky’s direct air capture facilities over the next decade.

The deal signals growing interest in carbon removal, direct air capture, carbon credits, decarbonization, and climate finance as organizations search for ways to address emissions that are hard to eliminate. Both companies stated that the agreement will help expand permanent carbon removal infrastructure in Canada and support the commercial growth of the country’s developing carbon removal market.

Deep Sky Expands Carbon Removal Ambitions

Founded in 2022 and based in Montreal, Deep Sky develops projects that remove carbon dioxide directly from the atmosphere using various technologies. The company’s portfolio includes direct air capture and ocean carbon capture systems designed to permanently remove and store carbon emissions underground.

Deep Sky aims to scale carbon removal technologies capable of removing gigatonnes of carbon dioxide from the atmosphere. The company has attracted several notable customers, such as Microsoft, Royal Bank of Canada, and Google through Frontier Climate. This reflects a growing corporate demand for verified carbon removal solutions.

The new agreement with TD represents another milestone for the company as it seeks to establish large-scale carbon removal infrastructure in Canada and show the commercial viability of engineered carbon removal projects.

TD Continues Decarbonization Efforts

According to TD Bank Group, the agreement fits into its broader sustainability and emissions reduction strategy. The bank reported a 29 percent reduction in its Scope 1 and Scope 2 greenhouse gas emissions compared to its 2019 baseline.

While the organization continues to focus on cutting emissions across its operations, it recognizes that some residual emissions may still be hard to eliminate. Therefore, TD plans to enhance its decarbonization efforts over time through voluntary investments in high-quality carbon dioxide removal technologies.

The carbon removal credits supplied under the agreement will be produced in Canada and verified through an independent third-party registry. Such verification is increasingly seen as essential for ensuring the credibility and transparency of carbon removal projects and the environmental claims tied to them.

Industry Sees Growing Demand for Permanent Carbon Removal

This agreement reflects a broader trend where corporations are entering long-term offtake arrangements to support the development and scaling of permanent carbon removal technologies. These agreements offer developers more revenue certainty, which helps secure financing and speed up project deployment.

Industry participants consider long-term purchasing commitments a crucial step for advancing technologies like direct air capture, which currently face high development and operational costs. By guaranteeing future demand, buyers can help create market conditions that inspire investment and innovation.

Charlie Renzoni, Vice President of Carbon Markets at Deep Sky, stated that the agreement shows how carbon removal infrastructure can be developed at scale in Canada. He noted that TD has established one of the more advanced decarbonization programs in the financial sector and described the deal as an example of enterprise carbon removal procurement.

Renzoni added that the agreement indicates that permanent carbon removal infrastructure can be built domestically while fostering the growth of a Canadian carbon removal ecosystem.

Supporting the Next Generation of Climate Solutions

TD also highlighted the role that emerging carbon removal technologies may play in reaching long-term climate goals. Susan Thompson, Managing Director and Head of Global Sustainable Finance & Advisory at TD Securities, stated that agreements like this are vital for speeding up the development of next-generation carbon removal solutions.

She pointed out that working with providers such as Deep Sky assists in constructing essential infrastructure while positioning organizations to help clients integrate reliable carbon removal solutions into their decarbonization strategies.

As governments, businesses, and investors explore pathways to achieve net-zero emissions, the demand for verified, permanent carbon removal solutions is expected to rise. The TD-Deep Sky agreement shows how long-term purchasing commitments are becoming an essential tool for moving carbon removal technologies from early-stage development to commercial scale.

This partnership also strengthens Canada’s growing role in the global carbon removal market, with domestic projects gaining support from major corporations looking for credible ways to address residual emissions and contribute to broader climate objectives.