January 6, 2022, Mecklenburg-Western Pomerania, Wismar: Smoke rises from the chimneys of woodworking industrial plants at Wismar Seaport. Photo: Jens Butner / dpa-Zentralbild / ZB (Photo by Jens Butner / Photo Union via Getty Images)

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Eric Towne is a technically leading investor for Bill Gates, a climate technology investment firm. Drilling energy companies. He is one of two people who must sign each deal to be funded, and he has signed five investments in carbon capture technology, four of which have been made public.

Carbon dioxide from the burning of fossil fuels is a major source of man-made climate change. Carbon capture is a set of methods – some time-tested, some experimental – to reduce carbon dioxide emissions by removing them from the source or atmosphere. (The term “carbon” is often used as shorthand for carbon dioxide, CO2, in discussions of capture and sequestration technology.)

Toone understands the arguments against carbon capture technology, but is still optimistic.

One big fear is that carbon capture technology poses a “moral hazard”, he told CNBC in a video interview. If carbon capture technology becomes cost-effective, then companies may not decarbonise their operations – they will simply continue to emit and then withdraw the carbon they emit from the atmosphere, effectively stepping on the water in the emissions race.

Instead, critics say, companies should focus on decarbonising their operations by using renewable energy and improving energy efficiency.

Toone believes this is a false dichotomy.

“It should be all of the above,” Towne told CNBC.

This is stated in the latest report of the UN Intergovernmental Panel on Climate Change.

Carbon dioxide removal is “necessary” to offset “difficult to reduce” residual emissions “and” is also an essential element of 34 scenarios that limit warming to 1.5 ° C or possibly below 2 ° C by 2100. “, the technical summary of the report states.

Who’s paying?

However, in order to scale a technology, there must be a demand.

It is easy to see the economic demand for low-carbon alternatives to existing products. Wind and solar energy can be cheaper than fossil fuels to generate electricity, electric vehicles can eliminate expensive travel to the gas station, and improvements in industrial processes and building efficiency save not only energy but also money.

So who will pay for the removal of carbon dioxide and why?

“It’s a $ 64,000 issue,” Towne told CNBC.

Currently, the carbon capture market is voluntary, which means that companies participate if they choose, and not by any imposed federal requirements or regulations. Green shoots have recently appeared on this market. For example, in mid-April, online payment technology provider Stripe has partnered with several other technology companies, including Alphabet, a parent of Google, and Meta, a parent of Facebook, to commit nearly $ 1 billion to boost the carbon capture market.

Stripe would like to see other companies increase the initial funding fund, but also acknowledges that the industry will almost certainly need government intervention. This could come in the form of carbon prices, subsidizing the removal of carbon that private companies do, or funding research, Florian Maganza of Stripe told CNBC.

But for now, the demand side is extremely uncertain. There is some demand from the industry – the carbonated drinks industry, for example, pays up to $ 1,000 per tonne for carbon dioxide in some markets, while the oil industry pays about $ 35 per tonne for carbon dioxide to be used for improved oil recovery. , explains Town. But overall, the carbon capture market suggests that government regulation or incentives will increase over time as the problem of climate change becomes more apparent and management becomes a political necessity.

“As long as society doesn’t value carbon, no, there’s no way to make money from carbon capture except through voluntary markets,” Tuun said. “This is the Wild West.”

However, about 25 other countries have some kind of carbon market.

“The biggest – without a doubt – is China,” Tuun told CNBC.

“China’s system focuses first on the energy sector and is based on emissions per unit of output. Individual producers will provide information on both capacity and emissions, then receive credit based on historical output, and then pay or receive credit depending on whether they are above or below their margin. ”

The chemical method: Hard and expensive

Uncertain search is not the only challenge. Carbon capture on a large scale is also a technical challenge and expensive to implement.

Generally speaking, there are two main components to carbon capture technology. First, this is the shooting – it must be taken out of the air. Then there’s some sequestration – once you’ve captured the carbon, you have to put it somewhere.

Direct carbon capture can reduce carbon emissions at the point where they are produced, but it is difficult to scale as each plant needs to be upgraded to order. In addition, it is doing nothing to remove the carbon dioxide that has already been emitted from other sources over the past 150 years.

To remove carbon that is already in the atmosphere, you must rely on photosynthesis from plants – planting trees, for example – or chemical technology.

In the case of chemical carbon capture, the air must pass through a technical apparatus so that the carbon dioxide can bind to any chemical used. Pumping enough air through this technical device requires a lot of energy.

“When carbon dioxide is only present in 400 parts per million in the air, it means that I have to pass an absolutely huge amount of air over these structures to capture it,” said Tune.

To capture one million tons or one megatons of carbon dioxide a year, an operation will have to move 46,000 cubic meters of air per second – and that’s provided it captures 100% of the carbon dioxide in the air, Tune told CNBC. his own calculations. More realistically, you would capture only half of the carbon dioxide, which means you would have to move more than 100,000 cubic meters of air per second.

And that’s just for one megaton.

The US government aims to remove several gigatons or one billion metric tons of carbon dioxide from the atmosphere by 2050 and store it “permanently” for less than $ 100 per ton. The Ministry of Energy calls this goal its own Carbon negative earth picture.

For a carbon capture project to be successful, the amount of carbon emissions created to generate energy to operate the carbon capture machine must be less than the carbon dioxide captured by fiction – otherwise all the effort is negligible.

“Yes, the numbers are starting to get pretty scary,” Towne said.

Two companies leading the charge, according to Toone, are Carbon engineering and Climeworks. (Breakthrough is not an investor in any of them.)

Climeworks factory with fans in front of the collector, sucking out the surrounding air and releasing it, as much of the purified CO2 through the rear fans is seen at the Hellisheidi power plant near Reykjavik on October 11, 2021 – Climeworks is in ICELAND containers similar to those used in maritime transport, are arranged in pairs, 10 meters (33 feet) high. The fans in front of the collector draw the ambient air and release it, largely purified from CO2, through the fans at the rear. (Photo by Halldor KOLBEINS / AFP) (Photo by HALLDOR KOLBEINS / AFP via Getty Images)

Haldor Colbines Afp | Getty Images

Climeworks is currently capable of capturing carbon dioxide at a cost of approximately $ 600 to $ 800 per tonne, Judith Hebekeiser, Climeworks’ communications manager told CNBC. That price should fall between $ 250 and $ 300 a tonne by 2030 if Climeworks operates on a million-tonne scale. And if the industry matures as expected, then costs should fall to $ 100 to $ 200 per tonne.

Towne says the US government’s $ 100 per tonne target is not unreasonable.

“The price of solar energy has dropped 300 times since 1975,” Tune said. “She passed the giggle test completely,” Tune said.

Once carbon is removed from the atmosphere, there are two main ways to store it: biological and geological. Biological carbon capture is when carbon from the atmosphere is stored in plants, soil, wood or even the ocean. Geological capture of carbon is the process of storing carbon dioxide underground. To do this, companies either pump carbon dioxide into underground caves, or combine it with liquid and pump it into porous rock formations, where CO2 can “mineralize” over time.

In its first commercial carbon removal plant in Iceland, Climeworks takes the carbon dioxide it removes from the air and gives it to a partner company. Carbfix, which absorbs carbon and injects it into groundwater to react with basaltic rock. Over the next two years, carbon became hard rock, “locking it up for hundreds of thousands of years,” Hebekeuser told CNBC. Although permanent storage is the main focus of Climeworks, it is open to other options, such as carbon products with recycling or the production of renewable fuels.

The question of verification

There are other, mostly non-chemical methods that “cost a small, small, small portion of that $ 100 a ton,” Tune said, but testing is a big problem for many.

Growing trees is one example. But the trees are dying, burning from forest fires, being cut down for timber.

Companies like Pachamapart of Breakthrough’s investment portfolio, are working to test how much carbon is captured in an acre of forest.

Another example is the use of naturally occurring chemical calcium silicate, placing it on the beach and leaving it there. Calcium silicate reacts with carbon dioxide in ocean water to form calcium carbonate, an insoluble solid that sinks to the bottom of the ocean. The ocean will continue to extract more carbon dioxide from the air to stay in balance, according to Tuun, who was professor of chemistry at Duke University for almost three decades before joining Breakthrough.

But without verification, these methods will not work.

“We live in absurdly cynical times,” Towne told CNBC. If there is a feeling that carbon capture is a scam, then people will not pay for carbon capture at all. “We need to get the public involved. That’s why I think validation and verification are extremely important.”


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