Chestnut Carbon has raised an additional $90 million from the Canada Pension Plan Investment Board, bringing its Series B round total to $250 million – the largest carbon removal funding round of the year.
Incubated by energy investor Kimmeridge, Chestnut acquires marginal farmland and pastureland across the US – land once farmed or grazed and now lying unused – and replants it with native trees to capture carbon.
The credits generated from these afforestation projects are sold to corporations seeking high-quality, verifiable offsets (see, “Corporate buyers nudge voluntary carbon markets toward higher-quality projects”).
“Right now, what we know works are trees,” Chestnut’s Greg Adams told ImpactAlpha. “Trees have been around for 350–400 million years. They’re a known quantity – the oldest carbon-capture machine ever created.”
Chestnut counts Microsoft, JP Morgan, Apollo Global Management and Sol Systems among its credit buyers and its pipeline now spans more than 65,000 acres across eight states and nearly 300 landowner partners. The Series B follows a $210 million non-recourse project finance facility closed in July to support the company’s “Megaton Project” with Microsoft. Lenders for that facility included J.P. Morgan (also as a lender), CoBank, Bank of Montreal and East West Bank.
The new capital will fund Chestnut’s expansion into additional domestic geographies, enrollment of more landowners and scaling of its carbon credit supply to meet surging corporate demand.
Market momentum
Chestnut’s record raise highlights a broader shift in corporate carbon strategies toward “high-quality” removal credits. Planting new forests results in carbon sequestration that would not have occurred otherwise, and the carbon stored can be verified. However, given the possibility of wildfires or future harvesting, the duration of that storage is not as long as enhanced mineralization, biochar and other methods that can lock carbon away for centuries.
Earlier this year, Shopify agreed to purchase credits from Houston-based Mati Carbon, which uses enhanced rock weathering to store carbon in soil. Microsoft, beyond its Chestnut partnership, has struck agreements with multiple other developers, including Re.Green in Brazil.
Collectively, these agreements represent commitments to remove nearly 11 million tons of CO₂ from the atmosphere.
“Five years from now, I hope that our $210 million project finance deal is just a footnote – no longer novel, but a financing structure that we’ve helped make mainstream,” Adams said. “It is important to show buyers, particularly when they are purchasing voluntary credits, that when they trust the right developers, that trust is well placed”
