Carbon Capture

Not so long ago, we (and when I say we, I mean many nations, EU nations mainly) made ourselves a promise: to curve climate change. To bring it to a halt. To reach global net-zero (in terms of emissions) by 2050.

This commitment was of the loadable kind; we needed it, and with good reason: temperatures continue to ratchet up as we continue to pour carbon dioxide into the atmosphere (something, I might add, that will not go away on its own). These temperature increases are giving us all sorts of trouble: uncontrollable fires, extreme heatwaves, droughts, melting polar caps, rising sea levels.

So yes, we need global net-zero. And we need it by 2050 at most. But…

But this is not an easy problem to solve, mainly because we put out way more carbon into the atmosphere than we can handle. So we need to do something about it.

And we are, I’m glad to say. Doing something about it, that is. Or trying to, at least. Because the solution, while not easy, is quite simple: if our problem is that we’re pouring too much CO2 into the atmosphere, the solution is self-evident: we either need to produce less of it, or find some way to trap it before it reaches the atmosphere (or remove it once its there) at scale, and recycle it into something altogether different (and less harmful to the environment).

Last week, we talked about how advances in battery technology can help us reduce our CO2 emissions by producing and storing clean energy. Today, we’ll tackle the trapping-carbon-before-it-reaches-the-atmosphere part of the equation.

This, in technical terms, we call Carbon Capture and Storage technology.

 
Carbon Capture and Storage

Carbon Capture and Storage (CSS, is “a way of reducing carbon emissions (…) a three-step process, involving: capturing the carbon dioxide produced by power generation or industrial activity, such as steel or cement making; transporting it; and then storing it deep underground.”

That definition (courtesy of the National Grid Group), I should add, is missing one more step in the process. Up until recently, we’ve only had carbon capture and storage, today we also have carbon recycling. But more on that later.

But before we move on to how exactly we go about capturing carbon and then storing it… let’s look at the magnitude of the problem we’re facing. Scientific models indicate that, in order to reach our 2050 net-zero goal (hitting pause on the global warming button at 1. 5 ˚C), we need to find a way to capture, store and/or recycle anywhere from 1.3 billion to 29 billion tons of CO2 per year. Other estimates, particularly one out of a 2017 UN report, say we need to remove 10 billion tons per year every year by 2050 in order to keep the planet from heating past 2 ˚C (and that number increases, by the way, according to the report after 2050 we’ll need to remove 20 billions tons of CO2 annually by 2100).

Simply put: it’s a big problem. For reference: 10 billion tons of CO2 is a lot of CO2 — nearly twice the United State’s current annual carbon emissions. And did I mention that we currently capture, with all our carbon-capture projects at full capacity, only about 40 million tons per year?

But we’re doing our best to up that number, mainly through two distinct, but complementary technologies:

  • Traditional Carbon Capture:This involves capturing carbon emissions before they reach the atmosphere.
  • OrDirect Air Capture (DAC): “a process of capturing carbon dioxide directly from the ambient air and generating a concentrated stream of CO 2 for sequestration or utilization or production of carbon-neutral fuel and windgas.”

And I’m glad to say there are a number of European startups working on these two technologies, and other supplemental technologies (e. g. capturing carbon and immediately transforming it into clean energy through Hydrogen production, such as Norway’s ZEG Power). These include:

 
EU Involvement

As mentioned above, the problem in our hands — the sheer quantity of carbon we need to capture in order to reach our 2050 goal — is, simply put, immense. Startups alone, no matter how good their technology is, can’t begin to make a dent. Particularly given how expensive it is to capture carbon (about $200 per metric ton), and how cheap its (not-really-effective, and quite morally dubious) alternative Carbon Offset, is.

But the good news is that startups are not alone in this fight. The EU is on their side, providing them with money, guidance, and policy support. That €60 per metric ton to offset carbon emissions, for example, was the EU’s doing: the Emissions Trading System’s (ETS) is continually upping the cost companies pay to offset their carbon emissions — from €33 per metric ton at the beginning of the year, to upwards of €60 per metric ton as of today. A persistently high carbon offset price, after all, might just be the push companies need to veer away from carbon offsets and towards carbon capture — particularly if the technologies continue to develop and scale, lowering its costs.

And then there’s the ‘let’s throw money at the problem and see what happens’ kind of EU involvement. Which, of course, can’t hurt. This we see evidenced mainly in the European Commission’s partnership with Bill Gates’ sustainable energy funding vehicle. In a recent announcement, the two parties pledged an investment of upwards of $1 billion to be distributed over five years (2022-2026) into projects trying to tackle the emissions problem, and Direct Air Capture is one of the four sectors they’re prioritizing.

 
Investors’ Appetite

And thank god for Bill Gates and the EU Commission because investors aren’t as bullish on Carbon Capture and Storage, Direct Air Capture, and Carbon Recycling technologies, as they are on Battery Tech or Electric Vehicles. And with good reason: these projects are expensive, with time horizons longer than most investors are comfortable with, and rely on government subsidies in order to operate.

According to PitchBook, VC-backed carbon captures have, globally, raised $336.5 million in 2020, and about 2/3 of that investment doesn’t even come from VCs, but from non-traditional investors, such as oil companies and governments.

It’s not all bad news, though. As shown in the graph above, that $336.5 million is a substantial increase from the $246 million raised by carbon capture startups in 2019. And more and more big-name investors, such as Cherry Ventures in the case of funds, or Patrick Collison in the case of angels, are getting involved.

 
Funds & Accelerators

 
Angels

  • David Helgason (invested in Carbo Culture)
  • Mika Ihamuotila (invested in Carbo Culture)
  • Albert Wenger (invested in Carbo Culture)
  • Paul Bragiel (invested in Carbo Culture)
  • Ian Hogarth (invested in Holy Grail)
  • Oliver Cameron (invested in Holy Grail)
  • Patrick Collison (invested in Holy Grail)

 
Challenges

I won’t dally: there are many. We’re still in the very early days of this type of technology and, to be frank, it looks like there’s a chance it might never work well enough (and at a large enough scale) to solve the problem we’re facing.

I already hinted at the two main challenges Carbon Capture companies face throughout the narrative: (1) Carbon Capture is just too damn expensive, especially compared to carbon offsetting; and (2) the problem is too big, and current (global) carbon capture projects can barely begin to make a dent on it. (Remember: we’re currently capturing about 40 million tonnes of CO2 per year when we need that number to be about 10-15 billion.)

And here’s another challenge, which only makes the aforementioned two others harder to solve: scaling carbon capture technology is hard. And I’m not just talking about the fact that we need to reach an immense scale in order to drive carbon capture prices down enough so as to make it a viable option for polluter companies.

The technology itself is complex, and requires immense capital investment — we’re talking about pulling a molecule out of the air as if by magic, transporting it, and then storing it or recycling it, after all. The natural solution — planting trees through things like Carbon Offset programs, are way more straightforward.

 
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​Πηγή: Gonz Sanchez

seedtable.com

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