January 6, 2022, Mecklenburg-Vorpommern, Wismar: Smoke rises from the chimneys of woodworking industrial plants in the seaport of Wismar. Photo: Jens Büttner / dpa-Zentralbild / ZB (Photo by Jens Büttner / picture alliance via Getty Images)

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Eric Thun is the technical leading investor of investment firm Bill Gates in the field of climate technology Breakthrough Energy Ventures. He is one of two people who must sign any deal to get funding, and he has signed five investments in carbon capture technology, four of which have been made public.

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

Thun understands the arguments against carbon capture technology, but in any case he is 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, companies may not decarbonize their operations – they will simply continue to emit and then extract the carbon they emit from the atmosphere, effectively stepping on water in the emissions race.

Instead, critics say companies should focus on decarbonising their operations through the use of renewable energy sources and energy efficiency.

Thun believes this is a false dichotomy.

“It has to be higher,” Thun told CNBC.

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

Removal of carbon dioxide is “necessary” to balance residual emissions that are difficult to reduce, ”and this is also an important element of the 34 scenarios that limit warming to 1.5 ° C or probably below 2 ° C to 2100 g . ”, The summary of the report says.

Who pays?

However, for technology to be large-scale, there must be demand.

It is easy to see the economic demand for low-carbon alternatives to existing products. Wind and sun can be cheaper than fossil fuels to produce electricity, electric vehicles can save you from expensive refueling trips, and improving industrial processes and building efficiency saves not only energy but also money.

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

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

Currently, the carbon capture market is voluntary, which means companies participate when they want, not because of any federal requirements or regulations. Recently, green shoots have appeared on this market. For example, in mid-April, online payment technology provider Stripe teamed up with several other technology companies, including parent company Google Alphabet and domestic company Facebook Meta, to allocate nearly $ 1 billion to boost the carbon capture market.

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

But so far the demand side is very uncertain. There is some demand from the industry – for example, the carbonated beverage industry pays up to $ 1,000 per tonne of carbon dioxide in some markets, while the oil industry pays about $ 35 per tonne of carbon dioxide for use in boosting oil production, Thun explains. But overall, the carbon capture market suggests that government regulation or incentives will intensify 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 on carbon capture other than in voluntary markets,” Thun said. “It’s the Wild West.”

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

“The biggest – by far – is China,” Thun 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 electricity and emissions production and then receive credit based on historical production volumes and then either pay or receive credit whichever is greater than or less than their allowance ”.

Chemical method: solid and expensive

Uncertain demand is not the only problem. Carbon capture on a scale is also technically difficult and expensive to implement.

Generally speaking, there are two main components of carbon capture technology. First, it is a capture – it needs to be pulled out of the air. Then, there’s part of the sequestration – once you’ve captured the carbon, you need to put it somewhere.

Immediate carbon capture can reduce carbon emissions at the point where they are produced, but this is difficult to scale because each installation must be upgraded on an individual basis. Moreover, it is doing nothing to remove 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 need to rely on photosynthesis of plants – such as planting trees – or chemical technology.

During the chemical capture of carbon, the air must pass by the 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.

“If there is only 400 parts of carbon dioxide in the air, it means that I have to pass a huge amount of air over these structures to capture it,” said Thun.

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

And that’s just for one megaton.

The U.S. government aims to remove several gigatons, or one billion metric tons, of carbon dioxide from the atmosphere by 2050 and store it “for a long time” for less than $ 100 a ton. The Department of Energy calls this target its carbon-negative land.

For a carbon capture project to be successful, the amount of carbon emitted to generate energy for the operation of the carbon capture machine must be less than the carbon dioxide captured by the device – otherwise all efforts will be in vain.

“Yeah, the numbers are starting to get pretty scary,” Thun said.

The two companies leading the charge, according to Tuna, are Carbon Engineering and Climeworks. (Breakthrough is also not an investor.)

The Climeworks factory with fans in front of the collector that draw in ambient air and release it, as significantly purified CO2 through the fans behind is seen at the Hellisheidi power plant near Reykjavik on October 11, 2021. – The Climeworks factory is located in Icelandic containers similar to those used in maritime transport, stacked in pairs, 10 meters (33 feet) high. Fans in front of the collector draw in 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 Colbain Afp | Getty Images

Currently, Climeworks can capture carbon dioxide at a cost of about $ 600 to $ 800 per ton, said CNBC’s Judith Hebekeizer, communications manager at Climeworks. That cost should drop to $ 250-300 per tonne by 2030, when Climeworks will operate in the millions of tonnes. And if the industry matures as expected, then costs should drop to $ 100-200 per ton.

Thun says the U.S. government’s goal of $ 100 a ton is not unreasonable.

“The cost of solar energy has fallen 300 times since 1975,” Thun said. “It absolutely passes the giggle test,” Thun said.

After removing carbon from the atmosphere, there are two main ways to store it: biological and geological. Biological sequestration of carbon is when carbon from the atmosphere is stored in plants, soil, wood or even in the ocean. Geological sequestration 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 a liquid and pump it into porous rock formations, where CO2 can “mineralize” over time.

At its first commercial carbon removal facility in Iceland, Climeworks takes carbon dioxide, which it removes from the air, and passes it on to its partner company, Carbfix, which picks up carbon and injects it into underground water to react with the basalt rock. Over the next two years, carbon turns to hard rock, “locking it up for hundreds of thousands of years,” Hebekeizer told CNBC. Although permanent storage is the main focus of Climeworks, it is open to other options, such as carbon-recycled products or renewable fuels.

The question of verification

There are other, mostly non-chemical methods that “cost a tiny, tiny, tiny fraction of that $ 100 a ton,” Thun said, but for many, verification is a big challenge.

Growing trees is one example. But the trees are dying, they are being burned by forest fires, cut down on lumber.

Companies like Pachama, part of Breakthrough’s investment portfolio, are working to test how much carbon is captured in acres of forest.

Another example is the use of natural chemical silicate calcium, put it on the beach and leave it there. Calcium silicate reacts with carbon dioxide in ocean water to form calcium carbonate, which is an insoluble solid that sinks to the ocean floor. The ocean will continue to pull more carbon dioxide out of the air to stay in balance, says Thun, who was a professor of chemistry at Duke University for nearly three decades before joining Breakthrough.

But without testing these methods will not work.

“We live in absurdly cynical times,” Thun told CNBC. If there is a feeling that carbon sequestration is a scam, then people are not going to pay for carbon capture at all. “We need to involve society along with this. That’s why I believe that confirmation and verification are extremely important. “

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