Swiss startups Climeworks and Neustark have entered into a long-term collaboration as part of UBS's commitment to achieving net zero energy emissions from its operations starting in 2025, Switzerland's largest bank announced Tuesday. 

The two partner companies are considered pioneers in the field of carbon removal and are expected to remove around 39,500 tons of CO2 from the atmosphere over the next 13 years as part of the agreement. That amounts to the annual output of the emissions of just over 8,500 gasoline-powered vehicles according to a calculator from the US Environmental Protection Agency. Another metric, and perhaps closer to home for the Swiss where grilling seems to be a national pastime, is that the CO2 removed is equivalent to 1.6 million cylinders used for home barbecues.

Consolidating Credibility

For UBS undertaking such a project shows that it is serious about sustainability and also necessary to burnish its green credentials among its clients. «Switzerland has a long tradition of promoting innovation and we are delighted to be supporting these pioneering solutions from two Swiss companies. Sustainability continues to be at the top of our clients' agendas and, in order to be a credible partner, it is important that we demonstrate our continued commitment when it comes to the sustainability of our own business activities,» UBS Switzerland CEO Sabine Keller-Busse said about the partnership.

Removing Carbon

Neustark is a spinoff of the ETH technical university, considered to be the MIT of Switzerland or the other way around depending on who you ask. The firm specializes in the fossilization of atmospheric CO2 in recycled concrete. Meanwhile, the Orca plant, operated by Climeworks at the Hellisheidi geothermal power plant in Iceland, separates carbon dioxide from the atmosphere and stores it underground in basalt rock. Before UBS joined the effort, reinsurer Swiss Re signed a ten-year contract with Climeworks to remove CO2 from the atmosphere.

An issue for UBS is not only its emissions but also the loans it makes to entities whose activities accelerate climate change. Last March, UBS emphatically promised to reduce the carbon footprint of its loan book in the fossil fuel, power generation, and real estate sectors. These continue to make a significant impact on the institution's loan portfolio, accounting for some 43 percent of the total.

Viking Clap

If successful, perhaps sustainability-oriented investors will give UBS the «Viking Clap» made famous at the 2018 football world cup by fans of Iceland's team.