Investors Are Betting Big on Carbon Removal Technology. The Reality Is More Complicated.

In the late 1800s, before the Wright Brothers took off, earth’s annual average temperature was about 13.7 degrees Celsius. But since the Industrial Revolution, the global temperature has gone up by about 1 degree Celsius because greenhouse gas emissions (such as carbon dioxide) in the atmosphere trap heat like a blanket. Science says a hotter globe triggers extreme weather events: more fires, bigger floods, stronger hurricanes.

Without drastic measures, researchers say, the climate consequences will be much, much worse. So what’s the plan? The Paris Agreement wants to make sure earth absolutely does not get 2 degrees Celsius hotter than pre-industrial levels—and ideally no more than 1.5 degrees. This goal requires countries to act now (or, more accurately, yesterday) by reducing emissions to net-zero by 2050. Net-zero means greenhouse gases removed from the atmosphere cancel out greenhouse gases emitted from fossil fuels and industrial processes.

Will it be enough to avert a climate disaster? Some say no. Every year about 51 billion tons of greenhouse gases get released into the air, with carbon dioxide being the main culprit, making up 76% of the mix. In 2021, the global average level of carbon dioxide set a new record high at 414.72 parts per million. With so much carbon in the air, reducing emissions is critical, but not enough to meet climate goals. This is where using carbon removal technology—vacuuming CO2 straight out of the atmosphere for safe storage—comes in. If you follow the money, investors are betting big that carbon removal technology will be the way forward.

Are High-Tech Strategies The Way?

In 2020, the World Resources Institute (WRI), a nonprofit organization focused on helping solve global problems practically, published a paper showing the two strategies with the largest carbon removal potential from now to 2050: tree restoration and direct air capture (DAC). Both have their pros and cons. Tree restoration is low-maintenance, but requires a lot of land (and trees can burn down in wildfires, which are worsening under climate change). DAC, which uses ventilators to suck CO2 from the sky, takes up less space, but requires a lot of energy. That said, WRI supports a portfolio approach, says Katie Lebling, an associate in WRI’s climate program.

“This is an entirely new industry,” Lebling says. “Having a broad portfolio will minimize the risk of any single solution. It’s about not putting all your eggs in one basket.”

The climate tech boom suggests that financiers have their sights set on high-tech to save the planet. Forecasters expect $1.5 trillion to $2 trillion to flood into a range of climate tech startups by 2025. With the industry still emerging, nobody knows what will work best to remove 10 gigatons of carbon per year through 2050, the National Academy of Sciences estimate to meet the Paris Agreement goals. But from carbon recycling to carbon mineralization, ideas are not in short supply.

Proof of Concept

The solutions with the greatest impact will depend on several things, such as cost, scalability, and how effective they are at removing carbon permanently.

On the emissions reduction side, Carbon Clean, based in London with offices in India, Spain, and the United States, aims to address all three with a low-cost carbon capture unit called CycloneCC. Launched in 2021, the technology captures CO2 directly from the point of emissions, such as flue gas (sometimes called exhaust or stack gas) from an industrial plant. The captured carbon can then be used in products and processes—turned into soda ash and used in household detergents, for example, or to produce carbon neutral fuels—or permanently stored underground.

As of August 2022, CycloneCC has been successfully pilot tested in the U.K. A commercial rollout is scheduled for 2023 with deployment partners including CEMEX, Chevron, and Veolia. The cost of the unit is undisclosed at this time, but by 2025, Carbon Clean aims to have customers pay $30 per metric ton of carbon captured. (The company is testing the use of non-aqueous solvent (NAS) to bring this cost down in the future.)

This technology solves the “capacity problem,” says Aniruddha Sharma, chair and CEO of Carbon Clean. For decades, conventional technology for industrial sites were massive plants designed for the oil and gas industry. CycloneCC is the size of a shipping container, which Carbon Clean believes is pivotal for mass production. With target dates looming like storm clouds, equipment needs to be delivered lightning-fast. This unit can be up and running in less than eight weeks, Sharma says.

Based in Canada, Planetary Technologies is taking a more liquid approach. Its technology is based on the fact that the atmosphere and the ocean are constantly communicating. Too much CO2 in the air leads to too much CO2 in the oceans, which over time leads to dangerous ocean acidification, says Mike Kelland, CEO of Planetary Technologies.

“What if we reverse that?” Kelland says. “What if we put antacid into seawater, then what does that do? Research says it starts to rebalance and the ocean pulls CO2 out of the atmosphere, safely storing it for hundreds of thousands of years.”

The antacid (magnesium hydroxide) works like TUMS or baking soda, lowering the pH balance of seawater to make it less acidic. The idea is that by adding antacid to outflows from wastewater treatment facilities—which already are permitted and monitored to ensure the safety of treated water before it goes into the ocean—it will combine with dissolved CO2 in the surface oceans to form carbonates and bicarbonates that remain in the seawater for a long, long time. This, in turn, would allow more CO2 from the atmosphere to be captured and stored in the ocean.

Now that the research has been verified by scientists across fields related to climate and ocean science, Kelland says, Planetary Technologies will begin its open-ocean trials this year to develop methods to launch ocean alkalinity enhancement at scale to become an effective, international solution to the climate crisis.

When Powers Combine

But major investors have their eyes on the skies, banking on the promise of DAC. Since the start of 2020, governments have committed almost $4 billion in funding specifically for DAC development and deployment, according to the International Energy Agency (IEA).

Currently, there are 19 DAC facilities in operation worldwide. But the IEA Net Zero Emissions by 2050 Scenario calls for an average of 32 large-scale plants (each removing 1 million metric tons of CO2 per year—equivalent to the annual emissions released by over 215,000 cars in the U.S.) to be built each year between now and 2050. It’s hard to tell what the future cost of capturing CO2 will be. Early-stage technology shows estimates between $125 and $335 per metric ton of CO2 for a large-scale plant built today, according to IEA’s Direct Air Capture 2022 report. DAC technology is very energy-intensive, so using more renewable energy could help costs dip below $100 per metric ton of CO2 by 2030. But the CO2 in the atmosphere is less concentrated than CO2 from, say, a smokestack, which is why it requires much more energy to remove it and break it down.

This spring, Switzerland-based Climeworks raised $650 million in equity, the most ever invested into a carbon removal company. Today, Climeworks is the leader in DAC development and deployment with Orca, the world’s largest DAC plant in operation, removing and storing 4,000 metric tons of CO2 per year. (Canadian-firm Carbon Engineering is developing a project in Texas to capture 1 million metric tons of CO2 per year. When that comes online, expected in 2024, it will be the world’s largest DAC project.)

Before 2017, Climeworks was only capturing CO2 and selling it to greenhouses and beverage companies. (Carbon dioxide helps crops grow faster and adds fizz to drinks.) In September 2021, Climeworks opened Orca in collaboration with carbon storage pioneer, Carbfix, in Iceland. Why here? “Iceland, like many other parts of the world, has an interesting situation,” says Carlos Härtel, CTO for Climeworks. “If you inject CO2 into the core of the basaltic rock from the island, CO2 is converted into carbonate rock—the rock itself—and it’s going to stay there for good.”

How does Climeworks’s DAC work? In stages. First, a fan draws air into the CO2 collector. Once inside, the CO2 clings to a highly selective, active filter material to separate it from other particles in the air (dust, soot, etc.). The collector is then closed. The filter material is heated to about 100 degrees C. This releases the carbon dioxide for transfer, in its highly pure concentration, via pipes to Carbfix, who sequesters the CO2 deep underground.

But to keep this facility active, with ventilators running 24/7, you need energy: both electricity and heat. Though a pioneer in the use of geothermal energy, Iceland doesn’t have an abundance of solar energy. Climeworks hopes to set up another plant in the near future, potentially in North America, because of the advanced policy landscape, available infrastructure, and its many regions with good conditions for renewable energy, Härtel says.

Building While Flying

One thing climate tech startups don’t have an abundance of is time. A broad range of different designs will only gum up the supply chain and delay the mission, Härtel says. With reference to wind turbines and motor vehicles, he urges the sector to converge on a dominant design. This isn’t about sophistication or which technology looks the coolest. What matters is whether the DAC technology can withstand harsh conditions in the field, get the job done reliably, and be built fast.

“If you have too many different designs,” he says, “you have a challenge of scaling an industry.”

Critics see other challenges. Some argue the technologies are unproven, too costly, or use too many resources. Some have questioned the local impacts on communities. Others see the growing interest and investment in carbon removal approaches and technologies as a distraction from the immediate need of slashing emissions.

According to Lebling, emissions reductions need to remain the top priority in the near-term to reduce future reliance on carbon removal as much as possible. For example, the Science Based Targets initiative directs businesses to reduce emissions by at least 90%, then rely on carbon removal for 5-10% to reach the net-zero target.

“We will need carbon removal because we have not done enough on emissions reductions,” Lebling says. “But we can’t let carbon removal distract from the fact we need to do emissions reductions.”

This article is part of a series on key topics in the climate crisis for time.com and CO2.com, a division of TIME that helps companies reduce their impact on the planet. For more information, go to co2.com