Carbon removal is the process of removing carbon dioxide from the atmosphere and locking it away permanently, so-called negative emissions. To achieve the goal of carbon neutrality by 2045, California would have to remove 125 million tons of carbon per year.[1] Thus, carbon removal innovation is on the rise in California.
Direct Air Capture (DAC) encompasses a group of technologies that remove carbon from the atmosphere. To explain the concept in a simple way, think about DAC as a vacuum cleaner that sucks carbon dioxide from the air around us. There are a number of different ways to do this. While it is not a new technology area, however, in the past few years, several new companies have emerged in the space.[2]
An example of a DAC start-up is Noya, an early-stage start-up headquartered in San Francisco that has designed a rooftop carbon capture machine. Noya‘s unit can be attached to existing cooling towers on top of buildings and when air flows through these existing systems that control the indoor climate in a building carbon is removed from the air passing by the unit. In this way, you do not have to use extra energy to move air to remove the CO2 meaning that the unit capitalizes on existing hardware and energy consumption.
The dominant scientific view is that the climate goals of the Paris Agreement will be unattainable without negative emissions. A scenario by the International Energy Agency assumes that DAC technologies will capture millions of tons of CO2 in the future – about 85 Mt CO2 in 2030 and 980 Mt CO2 in 2050. As the current level is only around 0.01 Mt CO2, there is a lot of work ahead to accelerate scale-up of these technologies.[1]
In 2021, Climeworks launched the plant Orca, the world’s first and largest DAC and storage plant, on Iceland. Even though the technology is still nascent, more companies expect that they can scale their technology and capture CO2 for less than 100 USD per ton.
Another area is carbon capture directly from point source emitters. Within this area a report from Stanford University concludes that capturing and storing CO2 can become one of the largest single contributors to California’s green transition in the future. California will be able to reduce its CO2 emissions by as much as 15 percent in a relatively short time if they proceed with a targeted CO2 capture at just 76 of the largest CO2 industrial plants and power plants. Like Denmark, California has a huge underground storage capacity, large enough to accommodate the entire California electricity sector’s CO2 emissions in 2017 for 1000 years.[1]
The research and development stage of carbon capture is still early-stage, technologies are high-risk, and entrepreneurs having launched new companies successfully are not abundant. However, a robust start-up ecosystem of carbon removal ventures is on the rise, and several corporates, such as Stripe and Microsoft, are accelerating the space and supporting the startups by acting as buyers of carbon removal. The carbon removal ecosystem in California and the US more broadly has a lot to offer in terms of inspiration on DAC technologies and also nature-based solutions (land-based as well as ocean-based capture technologies).[1]
From a policy perspective, the Biden administration assess carbon capture and removal a necessity for the US to achieve net-zero emissions by 2050. US policymakers are pursuing carbon capture and removal within the areas of point-source carbon capture as well as DAC.[3]
From a corporate perspective, more established companies have entered the race for realizing carbon removal. The trend was initiated by Stripe in 2018, and soon after Microsoft followed. It has now spread to several other corporates also taking lead on carbon removal. A recent initiative, Frontier, a so-called Advance Market Commitment (AMC) was launched by Stripe, Alphabet, Shopify, Meta, and McKinsey & Company. Frontier aims to accelerate the development of carbon removal technologies by securing future demand for them. The initial commitment is to buy 925 million USD worth of permanent carbon removal between 2022 and 2030.[4]
From an academic perspective, new carbon removal technologies are emerging from California’s research institutions, such as Lawrence Berkeley National Laboratory, UC Berkeley, Stanford University and more. For instance, the SUNCAT energy research centre at Stanford University works to find new ways to convert CO2 into green chemicals and fuels. The strong research community within carbon removal also includes Stanford Professor Alfred Spormann, leading the new USD 100M international research centre, the Novo Nordisk Foundation CO2 Research Centre, based at Aarhus University with satellite institutions abroad.[1]
From the entrepreneurial perspective, more and more carbon removal start-ups are emerging. Communities such as AirMiners with initiatives such as Launchpad help build the pipeline of new carbon removal ventures. Furthermore, the Carbon XPrize, a USD 100M competition to scale carbon removal, funded by Elon Musk, is also expected to spur innovation.
From the perspective of investments, according to the non-profit organization, Carbon180, the global carbon removal market is almost USD 6 trillion with the greatest opportunities in fuels, building materials, and plastic products. Within venture capital, more specialized climatetech venture funds are also emerging. For instance, venture capital firm Lowercarbon Capital announced in April 2022 that they raised a USD 350M fund dedicated to carbon removal startups.[5]
Please reach out to Josefine Lange Strandgaard at josstr@um.dk for any inquiries. We offer our services to corporates, SMEs and academic partners looking to dive further into the area of Direct Air Capture.
Carbon Removal
