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Georgia = America’s EV capital
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JAN 12, 2022

Hello!

Listen here: I’m joining the Energy Gang podcast, airing this Friday wherever you get your podcasts, to talk about all things climate, including sustainable aviation fuel, the European Union taxonomy debate and Don’t Look Up!

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Send your energy photos, ideas and more to news@ciphernews.com or me directly at amy@breakthroughenergy.org.

EXPLAINED
Carbon is the trash of our climate change era
BY: AMY HARDER

We pay to get our garbage hauled away every week. Yet we’ve been letting carbon waste pile up in our skies since we first started putting it there more than 250 years ago.

Both our traditional trash and carbon waste represent blind spots in our economic system, where governments step in to facilitate an industry that benefits us in non-economic ways without any direct monetary advantages.

In our last edition, Cipher profiled LanzaTech, one of several startups in the burgeoning carbon management sector, which includes capturing, storing and recycling CO2. This week, we’re using garbage as an analogy to help explain the importance of removing carbon from the atmosphere and storing it underground.

Let’s talk trash!

Our traditional waste is a stinky eyesore and society has supported cleaning it up because it has improved public health and the environment even without direct economic benefits.

Over time, companies—led by Waste Management and Republic Services—have flourished by navigating the complex web of local, state and federal policies that govern our waste industry.

Debates about landfill locations have been controversial, and we’re still not recycling for the most part (just 16% of our global plastic is recycled).

Now compare that to our carbon trash.

Carbon waste is invisible to the naked eye, making it seem easier to ignore than a dumpster overflowing with foul-smelling garbage. But cleaning it up will also improve our public health and the environment, even though capturing CO2 doesn’t have a direct economic benefit.

We’re at the dawn of a new carbon waste management sector. LanzaTech is one of numerous companies aiming to financially thrive here; Occidental Petroleum, Carbon Engineering, Climeworks and Storegga are others.

Debates about where—and how—to store captured CO2 are emerging. The vast majority is likely to be stored, not recycled, due largely to the sheer volume we’re dealing with (see chart below).

Nearly all climate change technologies require far more government involvement than other sectors due to high capital costs and cheap incumbent industries, like fossil-fuel-based tech.

Direct air capture technologies (DAC), which feature massive equipment sucking carbon dioxide out of ambient air, is perhaps the most dependent of all on government support. This is precisely because it lacks a strict monetary value—like trash.

That’s one reason why DAC is among the four initial technologies included in Breakthrough Energy’s Catalyst program. Catalyst is partnering with corporations and governments to bring down technology costs in DAC, green hydrogen, sustainable aviation fuel and long-duration energy storage.

“The one that’s hardest is direct air capture because that mainly has an environmental benefit,” said Bill Gates, Breakthrough Energy’s founder, in a Bloomberg interview last fall. “It’s not a product like the other three are.” (In fact, that comment inspired this article!)

The lack of an inherent product value also explains the relative hesitancy from venture capitalists to invest in DAC.

Direct air capture “is more like taking out the garbage than investing in Uber,” said Peter Kelemen, a professor at Columbia University’s Earth Institute. “There are a lot of people who make money on handling garbage.” But venture capitalists feel it is risky to operate in industries when the customer is the government, he added.

That’s starting to change.

The amount of venture capital money going into carbon capture technologies globally has increased almost tenfold since 2016, reaching nearly $450 million last year, according to PitchBook, a financial research firm and data provider. Most of that ($330 million) is going into DAC as opposed to carbon capture directly at emitting facilities, which is separate but related technology.

By comparison, though, that’s not much. Venture capitalists poured more than $35 billion into clean energy and climate technologies last year, nearly half of that going to electric transportation alone.

Politicians are also ramping up government support for the technology. The $1.2 trillion infrastructure law directs $3.5 billion in Energy Department funding toward carbon removal technologies, which is part of the more than $100 billion going to climate and energy programs.

That will be a big boon for the nascent sector, but it doesn’t fix its intrinsic economic problem: making us pay for carbon waste like we do our garbage.

Jennifer Holmgren, CEO of carbon recycling firm LanzaTech, says we should view a tax on carbon emissions like a trash tax.

“We all pay to have trash hauled, right? But somehow we seem to struggle with the concept of a carbon tax. And I'm not sure what the difference is,” Holmgren said.

Although a carbon tax remains politically unpalpable, Congress is debating whether to expand an existing tax incentive called 45Q, for its placement in the tax code, which could help nudge us in the right direction.

Holmgren, in Cipher’s first “Innovators” virtual interview that aired earlier this month, said: “It's really important for us to think about waste collectively and how we get rid of waste to ensure that we optimize societal good.”

Editor’s note: Breakthrough Energy supports Cipher in addition to Catalyst. Gates is also separately an investor in Carbon Engineering.


Amy’s Lunchtime Reads
and Hot Takes

Battery recycling plant coming to existing facility near Rivian site The Atlanta Journal-Constitution
My take: Hummed to this popular nursery rhyme: First come the EV plants, then come the jobs, then comes support from the political people! Let’s watch as Georgia’s (mostly but not all) deep-red politicians embrace electric cars.

Hydrogen power is gaining momentum, but critics say it’s neither efficient nor green enough
CNBC
My take: This raises important issues about hydrogen, including cost. No one ever said this was going to be easy! Its inefficiency is particularly challenging. When producing and storing hydrogen, you get just 37% of the energy back out, so you’re losing nearly two-thirds of the total energy, said one expert in the story.

France says car ads must come with a caveat: Walk, bike or take public transit instead The Washington Post
My take: Yes, this, a thousand times yes! The cleanest car is…no car at all. I reluctantly bought a car last year in car-dependent Seattle, but I take the bus when I can. Tackling climate change should mean rethinking our mobility entirely so we can depend less on cars, even if they are electric.

Climate tech got an enormous cash infusion in 2021Fast Company
My take: Great news, but we've got to make sure it’s going to the right places, not just those that could make the most money for investors.

As U.S. moves toward solar energy, this roofing company hopes ‘solar shingles’ will get homeowners to buy in The Washington Post
My take: As someone who is efficient almost to a fault, I love this. Two-in-one: energy and shelter. I also like how this article raised some legitimate concerns about the technology because such an absence would just make me suspicious of the story’s quality.

Why Tesla Soared as Other Automakers Struggled to Make CarsThe New York Times
My take: This could have a relevant corollary to countries that decide to try to control all parts of supply chains, too.

Cost of neutralising carbon emissions soars as demand escalatesFinancial Times (paywall)
My take: If carbon offsets are going to be part of our climate solutions, at least it’s a good thing they’re becoming more expensive. But, as this article notes, the need for some sort of global standard putting guardrails on this sector is much needed.

More of what I'm reading:
  • Bill Gates-backed fund aims to invest $15bn in clean tech Financial Times (paywall)
  • A Widening Web of Undersea Cables Connects Britain to Green Energy The New York Times
  • First advanced reactor proposal suffers setback — E&E News
  • Analysis: Weak winds worsened Europe's power crunch; utilities need better storage Reuters
  • Michigan-based EV battery startup ONE says its new battery gets a 750-mile driving range in Tesla Model S before recharging — Tech Startups
DATA DIVE
To tackle climate change, carbon storage should be all the rage
Source: McKinsey & Company *Bio-charcoal is charcoal derived from burning organic agriculture and forestry waste products

Most of the carbon dioxide emissions that could be technically captured by 2030 will likely be stored, according to McKinsey & Company.

That’s because the sheer volume of carbon dioxide we’re emitting is massive. We emit 51 billion tons of greenhouse gases a year, with CO2 comprising most of that. Whether it’s sustainable aviation fuel or carbon-recycled yoga pants, there’s not enough of either to begin stabilizing Earth’s temperature.

“The fact LanzaTech is making yoga pants with Lululemon is slick,” said Julio Friedmann, a senior research scholar at Columbia University’s Center on Global Energy Policy. “We’re not going to solve the CO2 problem by making yoga pants.” It does help bring down costs, though, as we wrote last week.

Yoga pants would fit under the “plastics and chemicals” category.

AND FINALLY...
Combining waste and energy
I took these two photos during a 2018 trip to an Oslo, Norway waste-to-energy facility, which burns trash to make energy. This is controversial given toxic fumes associated with burning some types of trash. But with rigorous pollution controls, it can be an efficient way to deal with our trash while making energy. This facility is part of Norway’s ambitious plan to capture and store carbon emissions. It's been in the works for years (it’s why I visited!).
Each week, we feature a photo that is somehow related to energy, the thing we all need but don’t notice until it’s expensive or gone. Email your ideas and photos to news@ciphernews.com.
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