The Threes C's of CO2

The Threes C's of CO2

As we enter into yet another global summit on climate change, this time in Paris over the next month, I am expecting the pattern of previous summits to continue. Backroom deals, posturing, pointing figures, smiling photo ops, speeches, and all of the other things politicians do well. But my faith in this summit actually driving any meaningful reductions five to ten years out is very low, in the context of a world with falling energy prices and national balance sheets requiring growth at all costs. I fall in the camp that believes market driven technology is needed if the climate change problem is to ever be solved. Unfortunately, CO2, a key greenhouse gas (GHG), is a highly stable molecule. Both capturing and converting it to a product of value is typically an uphill battle with highly prohibitive costs. But living plants have evolved over billions of years to become highly efficient users of this gas, so what's stopping us from figuring out how to do the same? Let's see what a few smart people around the world are working on every day:

Capture

Separating a pure gas from a mixed stream is an uphill battle that will always have costs. Unfortunately the huge CAPEX and high parasitic energy losses of today's amine scrubbing facilities make them more suitable for political photo ops than mass commercial reality. An obvious area for innovation is improving the performance of amine scrubbing, and we have seen a wide range of incremental improvements such as amine co-solvents or drop-in replacements of alternative scrubbing chemistries that generally claim efficiency improvements of 40-50%. While these are nice improvements, the total impact is not enough to break open the market opportunity, and thus the potential reward makes them a questionable venture capital bet.

Recently, we learned about a new metal organic framework that can use low temperature waste heat to drive a low temperature adsorption-desorption delta of 40°C, a game changer compared to a high temperature 120°C amine swing. Another interesting approach that is close to our hearts, literally, is the use of the carbonic anhydrase enzyme. This is what regulates carbon dioxide exhalation in mammals; therefore, evolution has done a lot of the heavy lifting development work. The list of possibilities is both long and encouraging.Unfortunately, the time and cost to commercialization makes them risky venture capital bets so we'll keep our powder dry until we see an inevitable commercial ramp.

Convert

Once carbon dioxide is captured, an economic use that can pay for the capture cost is required. Enhanced oil recovery, the primary market today, is limited in terms of geographical scope. Another low hanging fruit is conversion to carbonates, a thermodynamically favorable path. Several start-ups are focused on this but we wonder -how much more baking soda does the world really need?

But what if a CO2 derived carbonate material could have an impact that punches far beyond its weight? It turns out that that's the approach taken by our portfolio company Carbon Cure Technologies. With their patented technology, the injection of a small dose of carbon dioxide into a concrete mix causes in-situ formation of highly dispersed nano-calcium-carbonate. Analogous to nanocomposites in the world of engineered plastics, concrete strength is increased by about 20 percent. Enabling concrete producers to reduce cement content in the mix creates a CO2 impact far beyond the amount sequestered, and the cost savings from the cement reduction makes it a true win-win. Research the company is to doing to accelerate the curing of waste materials, such as slag and fly ash, may further reduce the amount of costly cement in the mix.

To summarize:
Reducing the carbon footprint of a major industrial culprit ✔.
Cost savings for CarbonCure's customers ✔.
Greener buildings for us to live and work in ✔.

It's no wonder CarbonCure just signed its first commercial license with Vulcan Materials Company within six months of its pilot campaign earlier in the year. This might be the fastest commercial adoption of a new technology that the concrete industry has ever seen.

The Holy Grail of the "Circular Economy", a term coined by William McDonough, renowned design visionary and author, would be to use CO2 as a carbon feedstock for fuels and chemicals. That's a nice idea, but the energy requirements of breaking those two double bonds are immense. Of course this is where catalysts do the heavy lifting. We have seen numerous encouraging companies such as Econic Technologies and Novomer. But these types of process innovations can have a long road to commercialization and be tremendously capital intensive, which has scared us away to date. Perhaps the tailwind of plummeting renewable electricity prices combined with a bit more tinkering in the lab might bring us close to that commercial inflection point that we want to be ahead of when we invest.

Concede

Nature has some experience managing CO2 so perhaps the best approach is to concede that the key is found within living plants. Indeed, there is no shortage of researchers working on different approaches ranging from the artificial leaf, to engineered cyanobacteria to photosynthetic enzymatic complexes. As outlined in Sarah Applebaum's recent blog, Biology: The New Building Blocks, synthetic biology is condensing evolutionary timelines by millions of years. Unfortunately, synthetic biology hasn't yet solved all of the challenges around organism stability and reactor contamination that commercial implementation of these technologies face. But if and when these are solved, the elegant approach and ability to utilize a 400ppm atmospheric concentration creates the potential for a game changer where even early stage VC bets might make sense.

Carbon dioxide is a tough nut to crack; smart scientists and engineers around the world are working to outsmart the laws of thermodynamics and nature's evolutionary head start. We're cheering them on and hope that more CarbonCure commercialization stories will convince us it's time to open up the checkbook.

Partner, Pangaea Ventures Ltd. Andrew has over 12 years of energy and industrial experience, recently leading several of Pangaea’s investments in the energy generation, energy storage and energy efficiency domains. Andrew holds a Bachelor of Applied Science (Mechanical Engineering) and a Masters in Business Administration degree.View Andrew Haughian's profile on LinkedIn

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Guest Wednesday, 16 January 2019