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Speaker 1: This is Dana Perkins and you're listening to Switched on

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Speaker 1: the podcast where we discuss the energy transition with BENUF

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Speaker 1: analysts and highlight findings from their most recent research. And

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Speaker 1: today we're going to take a step away from carbon

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Speaker 1: reduction and explore the world of carbon removal technologies. Many

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Speaker 1: have had success over the past couple of years as

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Speaker 1: recipients of growing investments and a number of projects have

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Speaker 1: crossed the critical financial investment decision milestone or FID for short.

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Speaker 1: But of course the picture isn't rosy across the board,

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Speaker 1: and we will get into that on the show today.

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Speaker 1: We talk about the most established technology at the beginning,

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Speaker 1: which is carbon capture, Utilization and Storage or CCUS. We

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Speaker 1: also talk about some of the newer technologies like direct

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Speaker 1: air capture or DACK for short, and we save time

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Speaker 1: to get into the world of the newest sources of

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Speaker 1: innovation by delving in on direct ocean removal. To give

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Speaker 1: us all the updates, I speak with Brenna Casey, who

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Speaker 1: is an analyst from b and EF's Sustainable Materials team,

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Speaker 1: and she highlights findings from the recent research. Note CCUS

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Speaker 1: Market Outlook one h twenty twenty trough of disillusionment. She

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Speaker 1: also draws from another research note titled Direct Air Captures

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Speaker 1: Technology Battle to Heat Up in twenty thirties. BENYF clients

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Speaker 1: will be able to find the full research at BNF

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Speaker 1: go on the Bloomberg terminal or at BNF dot com.

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Speaker 1: If you like the show, subscribe on whatever you're listening

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Speaker 1: to us on now and you'll get an update when

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Speaker 1: we publish a new show, and if you give us

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Speaker 1: a review, other people will be able to find us

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Speaker 1: more easily. But right now, let's talk to Brenna and

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Speaker 1: get an update on carbon removal technology. Brenna, thank you

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Speaker 1: very much for joining the show today.

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Speaker 2: Yeah, thanks for having me, Dana.

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Speaker 1: We're here to talk about carbon removal technologies, and there

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Speaker 1: are a couple of different avenues we can go down.

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Speaker 1: We'll come to direct air capture and actually some really

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Speaker 1: interesting things happening in our oceans. But let's start with

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Speaker 1: the big one, which is carbon capture, Utilization and storage,

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Speaker 1: referred to as CCUS by most people. And one of

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Speaker 1: the things about carbon capture technology is that when we

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Speaker 1: look at a net zero future, so when we think

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Speaker 1: about there being you know this, well, this net number

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Speaker 1: where we are emitting and then absorbing this even amount

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Speaker 1: of carbon on an annual basis. There are parts of

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Speaker 1: the economy where CCUS is really the only existing solution

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Speaker 1: right now and plays a very important role in a

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Speaker 1: net zero future, at least with today's existing technology as

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Speaker 1: we think about this forward. This is something that featured

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Speaker 1: in our New Energy Outlook and definitely something that is

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Speaker 1: causing us to think really seriously about this technology and

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Speaker 1: the role it could play in the future. So the

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Speaker 1: whole show today is going to be about where this

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Speaker 1: investment is and where capacity editions are. So we'll just

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Speaker 1: start with a very simple question, is is there an

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Speaker 1: upward trend in investment into CCUS technology at the moment?

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Speaker 2: So short answer one hundred percent yes. Long answer, I

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Speaker 2: think it's pretty nuanced, depending on obviously region and then sector.

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Speaker 2: So over the last year we've seen a dramatic uptick,

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Speaker 2: particularly in EMEA the Middle East, a lot of investment

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Speaker 2: leading up to COP twenty eight, and then we've also

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Speaker 2: seen a lot of investment into particularly the heavy industry

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Speaker 2: sectors so cement, chemicals, steel, hydrogen in Europe, and that's

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Speaker 2: really as developers corporates those sorts of kind of stakeholders

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Speaker 2: brace and fear of the carbon price as well as

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Speaker 2: you know other sorts of like like cban, like border

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Speaker 2: adjustment mechanisms as well. So definitely an upwards trend in

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Speaker 2: those areas. In the US, well, the US leads and

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Speaker 2: investments in total, but that's really just bolstered by DOE funding.

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Speaker 2: So we're seeing lots of investment or subsidies from them

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Speaker 2: to kind of pick start a lot of our heavy industries.

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Speaker 2: And that's separate from forty five Q. But apart from

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Speaker 2: a lot of these subsidies, private investment is actually gone

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Speaker 2: down in the US so quickly.

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Speaker 1: So we're talking about the US. What is forty five Q.

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Speaker 2: Forty five Q. Yeah, So twenty twenty two, the government

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Speaker 2: signed into law the Inflation Reduction Act and baked into

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Speaker 2: that is forty five Q, which gives it's an investment

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Speaker 2: tax credit, So it's eighty five dollars per ton awarded

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Speaker 2: if you are storing the CO two kind of sequestered

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Speaker 2: from a point source plant, so a cement plant, petrichemical steel,

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Speaker 2: and then you're going to get sixty dollars per ton

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Speaker 2: if you're taking that CO two that you've captured and

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Speaker 2: utilizing it as a feedstock.

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Speaker 1: So it makes sense that we start kind of on

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Speaker 1: the around the world tour of what's actually happening in

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Speaker 1: investment for CCUS with the US which is the leader

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Speaker 1: at the moment. So if we're looking at just twenty

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Speaker 1: twenty three, kind of what was the level of investment.

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Speaker 2: Yeah, so twenty twenty three was around two point eight

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Speaker 2: billion dollars and that's primarily due to subsidies from the

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Speaker 2: US Department of Energy or the DOE. And we've also

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Speaker 2: seen a couple of projects reaching FID in twenty twenty three. However,

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Speaker 2: we've actually, I've seen momentum in the US drop off

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Speaker 2: pretty substantially, and that's due to a multitude of factors,

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Speaker 2: one primarily being the IRS has yet to kind of.

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Speaker 1: The IRS, the Internal Revenue Service, the same people that

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Speaker 1: are collecting my.

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Speaker 2: Taxes exactly exactly. They've yet to kind of set these

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Speaker 2: regulations or clarifications as to what qualifies as a project

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Speaker 2: that can receive a forty five Q subsidy. So investors

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Speaker 2: are a little bit wary, and therefore we haven't seen

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Speaker 2: continuous investment in twenty twenty four so far.

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Speaker 1: But presumably this seems like a barrier that once we

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Speaker 1: get through the mechanics of the way that government works,

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Speaker 1: that there could be you know, some pent up demand

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Speaker 1: and there could be more investment and more projects on

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Speaker 1: the way. Or is that just wishful thinking for me

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Speaker 1: working my way backwards. Since we started the conversation talking

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Speaker 1: about net zero goals.

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Speaker 2: When we look at the capacity that we have so

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Speaker 2: out until twenty thirty, it's around four hundred and twenty

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Speaker 2: four million metric tons of ccus opacity due to come online.

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Speaker 2: In reality, conservatively, I guess optimistically instead around thirty percent

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Speaker 2: of those projects are set to be canceled. When we

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Speaker 2: talk to a lot of developers in the industry, some

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Speaker 2: people like to say, maybe, hey, seventy percent of these

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Speaker 2: projects are going to get canceled. Over the last or

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Speaker 2: since forty five Q was ratified in twenty twenty two,

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Speaker 2: we've seen two consecutive years of double digit growth. When

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Speaker 2: we're looking at millions of tons of capacity announced to

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Speaker 2: come online, but four hundred and twenty four million metric

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Speaker 2: tons by twenty thirty, that number has remained unchanged since

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Speaker 2: I think last year in October when we released our

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Speaker 2: previous market outlook, and so I think really right now,

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Speaker 2: what we're seeing is a lack of additions and maybe

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Speaker 2: potential cancelations. Over the last couple of years, we've seen

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Speaker 2: lots of those, especially in Canada. It's mostly these power projects,

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Speaker 2: coal power projects, where the economics aren't extremely favorable and

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Speaker 2: so tying it back to forty five Q. Even with

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Speaker 2: forty five Q this is it's still prohibitively expensive. Forty

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Speaker 2: five Q alone is not enough to make the business

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Speaker 2: case for ccs, and these credits also only last twelve years,

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Speaker 2: so when you're thinking about building a new project with

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Speaker 2: a lifetime of thirty years, you kind of have to

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Speaker 2: see where you're going to make your money back on

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Speaker 2: that in forty five Q in a lot of cases

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Speaker 2: isn't enough for a lot of these developers to continue

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Speaker 2: to announce projects. However, once the IRS has figured out, okay,

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Speaker 2: what actually does qualify for a project, we're likely to

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Speaker 2: see industries like iron steel, blue hydrogen cement, We're likely

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Speaker 2: to see those first movers kind of potentially continue to

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Speaker 2: add in capacity. If you're looking at cement or coal

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Speaker 2: power where there's lots of impurities in the gas, you

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Speaker 2: have to scrub the gas, have a sorbin or a

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Speaker 2: solvent that isn't volatile, doesn't degrade in the presence of

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Speaker 2: those impurities. And due to the low concentration of CO

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Speaker 2: two in those flue gases, you also need high amounts

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Speaker 2: of energy to kind of sequester or strip that CO

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Speaker 2: two from the gas, and so it gets more and

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Speaker 2: more expensive the lower CO two concentration is in that gas.

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Speaker 2: There really isn't any alternative. That's the problem with CCS

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Speaker 2: is that CO two is effectively a waste product. It's

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Speaker 2: not a commodity. We're trying to make it a commodity.

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Speaker 1: I mean, we're already at the end of the line here,

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Speaker 1: we're looking at CCUS because there hasn't been a readily available,

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Speaker 1: economically viable alternative. It's jumped in. Is that a right

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Speaker 1: typification of how one should view the application of this technology.

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Speaker 1: Not in all cases, but let's say, you know, in

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Speaker 1: the majority of.

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Speaker 2: Cases, Yeah, definitely. I mean there is the argument of

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Speaker 2: electrify everything that we've heard, right, and so that has

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Speaker 2: a play and the power sector for example, but obviously

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Speaker 2: we need peaking power, which really can only be done

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Speaker 2: with you know, say nuclear hydrogen or natural gas with

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Speaker 2: ccs if we're looking at a net zero world, if

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Speaker 2: we're thinking about I think the best two examples are

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Speaker 2: for cement and petric chemicals. So you can sure electrify

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Speaker 2: half of these processes, but cement, for example, is well,

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Speaker 2: I guess both c and petric chemicals they a significant

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Speaker 2: amount of process emissions, meaning that electrifying only abates like

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Speaker 2: ah or yeah maybe yeah, forty percent of total industrial emissions.

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Speaker 2: And so you actually need ccs to to carbonize these

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Speaker 2: heavy industries. And so you can kind of use ccs

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Speaker 2: in these higher concentration sources, so natural gas, processing, ammonia,

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Speaker 2: ethanol where it's cheaper and you can kind of build

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Speaker 2: the supply chains, build the confidence in the technology, scale

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Speaker 2: it that way, and then where it's more expensive and

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Speaker 2: a larger barrier to entry for you know, cement and

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Speaker 2: petrochemicals later on down the line, that can then kind

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Speaker 2: of use that technology to help abate those emissions.

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Speaker 1: So you've established that some projects, what did you say,

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Speaker 1: close to a third of projects might end up not

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Speaker 1: moving forward. And then additionally, the current investment is slowing down,

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Speaker 1: and there may be reasons to believe that in the

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Speaker 1: future this could speedback up again, but for the time being,

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Speaker 1: this is the state of play, and I want to

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Speaker 1: understand kind of whose money is at stake. So is

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Speaker 1: it large corporates, is it oil and gas firms, is

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Speaker 1: it venture capital or is it private equity fund you know,

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Speaker 1: whose money is essentially tied up in the projects that

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Speaker 1: might be canceled and the investment strategy for the future.

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Speaker 2: Yeah, I think it's a mix of kind of all

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Speaker 2: of it, and also depends on the application. If we're

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Speaker 2: looking specifically at the US right now, it's the tax payers,

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Speaker 2: I guess you could say so. Last year again, primarily

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Speaker 2: it was a lot of DOE funding, which has kind

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Speaker 2: of helped kickstarting the industry, which makes sense again because

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Speaker 2: CO two is this waste product and funding for CCUS

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Speaker 2: or direct air capture can be viewed as it's a

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Speaker 2: public good right to remove the COO two from the

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Speaker 2: atmosphere or to abate it from going into the atmosphere.

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Speaker 2: What we're seeing right now, the biggest announcement to stay on,

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Speaker 2: you know, recent recent trends, so the industrial demonstrations projects

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Speaker 2: or the IDP that's been made available to lots of

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Speaker 2: heavy industry, so cement, iron and steel, Patrick chemicals, and

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Speaker 2: blue hydrogen the key industries that are taking home a

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Speaker 2: lot of money for CCUS, though that funding hasn't been

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Speaker 2: awarded to individual projects yet. There's still no negotiations. Things

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Speaker 2: have to be signed, so the funding is at risk

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Speaker 2: of I guess revocation until those agreements are signed. And

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Speaker 2: that's obviously contingent one on the new party in November,

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Speaker 2: whoever gets selected. That that might be an issue for

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Speaker 2: a lot of this funding. But again it really is taxpayer.

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Speaker 2: It's a lot of governments in the US right now

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Speaker 2: because private investors or even corporates are standing back and

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Speaker 2: are a little bit wary until these forty five Q

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Speaker 2: guidelines are set in stone.

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Speaker 1: So we've established that things have cooled a bit in

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Speaker 1: the US. But let's continue around the world and just

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Speaker 1: do a quick state of play on various other parts.

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Speaker 1: So do you want to go with the rotation of

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Speaker 1: the earth or against the rotation of the earth. Oh,

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Speaker 1: let's go with We'll go with. Okay, moving then next

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Speaker 1: to where I am, So where in Europe?

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Speaker 2: Now?

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Speaker 1: What is happening in Europe when it comes to CCUS,

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Speaker 1: Because before there was the Inflation Reduction Act. The European

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Speaker 1: Union certainly had ambitious net zero targets. So where are

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Speaker 1: we seeing projects here and is the investment dampening also

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Speaker 1: on this side of the pond?

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Speaker 2: Yeah, yeah, euro is a little bit of a different

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Speaker 2: story right now. We're kind of seeing Europe, particularly Germany,

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Speaker 2: as the test bed for industrial decarbonization. So many of

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Speaker 2: the projects we're seeing for I guess cement, chemicals, hydrogen

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Speaker 2: are all taking place in that area, which makes sense

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Speaker 2: because of the EUETS. So as that carbon price starts

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Speaker 2: to loom over the heads of a lot of these players,

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Speaker 2: they are taking initiative to start developing their decarbonization strategies

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Speaker 2: and so a lot of the money we're seeing there

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Speaker 2: is going towards those projects. Twenty twenty three in Europe

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Speaker 2: right now, we're really seeing a lot of projects just

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Speaker 2: move towards FID and so that was the Porthos project,

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Speaker 2: which was one of the biggest projects take FID last year,

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Speaker 2: and that's part of a hub. So the EU business

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Speaker 2: model is and we are seeing like sprinkles of this

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Speaker 2: in the US as well, but the EU centric business

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Speaker 2: model really is CCUS hub formation and that's just it's

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Speaker 2: kind of a natural business model because lots of industry

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Speaker 2: has just naturally conglomerated around port cities in the EU,

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Speaker 2: and so it makes sense to just create this co

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Speaker 2: located area to capture transport and store CEO two. And

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Speaker 2: so we're seeing lots of investment into those sorts of hubs,

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Speaker 2: and these are the sorts of projects that are beginning

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Speaker 2: to take FID. Granted, the Porthos projects, it took from

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Speaker 2: announcement to FID around ten years, so there's a pretty

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Speaker 2: large gestation period, you could say, but we are beginning

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Speaker 2: to see a lot of these projects take off. For

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Speaker 2: a few of these projects take off, but.

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Speaker 1: The EUETS, so the European Union's emissions trading system is

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Speaker 1: proving to be a important catalyst at least for CCUS

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Speaker 1: adoption and certainly across Europe in keeping emissions to a

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Speaker 1: level that that's actually been defined. And there are a

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Speaker 1: number of different ways of doing this, and I think

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Speaker 1: that's another podcast. But as we continue around the world,

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Speaker 1: so you had mentioned in the run up to COP

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Speaker 1: twenty eight, which took place in Dubai, there were also

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Speaker 1: a number of installations that were getting underwe in the

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Speaker 1: middle East, And you know, to some extent that doesn't

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Speaker 1: surprise me given that at those discussions at the COP

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Speaker 1: there was a discussion around the role that transition fuels

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Speaker 1: will play in the energy transition of the future, and

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Speaker 1: CCUS certainly helps facilitate some of these transition fuels, as

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Speaker 1: you pointed out natural gas being one of them. Well,

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Speaker 1: I guess my first question before we get into what's

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Speaker 1: actually happening in the Middle East. Do you think that

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Speaker 1: being a COP host country in the UAE, that that

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Speaker 1: was a part of the reason why so many eyes

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Speaker 1: were on CCUS as we headed into November last year.

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Speaker 2: Yeah, so one hundred percent. It was actually kind of

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Speaker 2: surprising to see the movement into the Middle East. I

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Speaker 2: think it was around one point three billion dollars of

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Speaker 2: investment in twenty twenty three that we saw in that region,

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Speaker 2: particularly ADNOCK, so the Abu Dhabi National Oil Company was

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Speaker 2: definitely a key catalyst and a lot of that funding. Obviously,

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Speaker 2: like natural gas, oil is their core competency there. It's

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Speaker 2: actually quite interesting a new trend we're starting to see

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Speaker 2: is actually direct air capture in that region too. There's

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Speaker 2: lots of pre existing oil and gas expertise obviously, lots

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Speaker 2: of depleted oil wells, and so we've actually heard word

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Speaker 2: of ADNOC partnering with Carbon Engineering to kind of start

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Speaker 2: a couple new pilots over there for one storage, but

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Speaker 2: also to cootwo utilization for fuels of some sort. But

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Speaker 2: I think COPP was probably a key catalyst of that.

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Speaker 1: Now, before we move on to Asia Pacific as a region,

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Speaker 1: is there anything happening in Africa?

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Speaker 2: Not really for ccs for dak though we are actually

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Speaker 2: seeing not in terms really of investments yet, but we

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Speaker 2: are seeing projects announced in Kenya in the Kenyan Rift

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Speaker 2: Valley actually where you can take advantage of really great

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Speaker 2: CO two storage geologic storage. You can mineralize the COO

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Speaker 2: two because there's lots of basalt rocks in that area,

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Speaker 2: and then there's great renewable energy, so lots of hydro

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Speaker 2: So we're seeing lots of companies kind of move into

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Speaker 2: that space down there. But in terms of CCS, we

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Speaker 2: haven't seen really any capacity editions now.

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Speaker 1: So I'm not ready for direct air capture fully yet.

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Speaker 1: We'll come back to that conversation, So hold that thought. Now,

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Speaker 1: moving to APAC and you know on this show we

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Speaker 1: do talk about adaption of technology in China a fair amount,

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Speaker 1: but in variably there are other parts of the region

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Speaker 1: that are also looking at this technology, and including Australia,

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Speaker 1: where are we seeing CCUS taking off in that continent.

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Speaker 2: Over the last couple of years. In Australia, we've actually

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Speaker 2: seen CCS funding revoked just because of this soured public

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Speaker 2: sentiment that a lot of Australians have towards CCS. There's

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Speaker 2: one big project in Australia that hasn't met it's previously

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Speaker 2: announced capacity targets, meaning that it's running at a lower

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Speaker 2: utilization rate and therefore it's actually costing millions and millions

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Speaker 2: of dollars more than initially expected. What we're seeing right

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Speaker 2: now in Australia is that people a kind of moved

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Speaker 2: away from CCS and are looking more towards as the

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Speaker 2: key technology that will help them in the energy transition.

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Speaker 2: China's a little bit of a different story what we're seeing.

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Speaker 2: We've actually seen a couple of pipelines actually become operational.

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Speaker 2: I think it was a one million ten per year

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Speaker 2: pipeline in China. Again, there's not any incentives geared towards

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Speaker 2: accelerating the industry like the US has with forty five

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Speaker 2: Q and so it's really a lot of these companies

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Speaker 2: over there have to rely on enhanced oil recovery to

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Speaker 2: create this supplemental revenue stream to help get a lot

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Speaker 2: of these projects over the line or make the business

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Speaker 2: cases for these projects. China did implement a carbon price recently,

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Speaker 2: not all industries are covered under that, and realistically it's

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Speaker 2: going to take to twenty thirty twenty thirty five for

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Speaker 2: that really to have any influence on CCUS editions, especially

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Speaker 2: when we're talking about or if we think about free

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Speaker 2: allocations and how many allowances a lot of industrials over

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Speaker 2: there are going to be given. But yeah, it's things

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Speaker 2: are moving slow in APAC, you could say.

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Speaker 1: So really simply put in what I'm hearing from you

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Speaker 1: is things are moving slow pretty much everywhere. And so

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Speaker 1: there's this important part of reaching climate goals that is

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Speaker 1: underfunded at the moment for a number of reasons, due

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Speaker 1: to economics that were expected to be more competitive by

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Speaker 1: this point, and by tax incentives and schemes that maybe

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Speaker 1: aren't really following through on what they were initially designed

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Speaker 1: to do. So there are some obstacles that need to

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Speaker 1: be removed for traditional ccus. Is that fair to say, Yeah,

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Speaker 1: we're going to pivot now to some of the technology

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Speaker 1: end of things. So you had reference direct air capture,

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Speaker 1: and that is where we are with machines sucking carbon

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Speaker 1: out of the air. So one might call them mechanical trees,

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Speaker 1: although I think that's a bit generous, but is definitely

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Speaker 1: a place where we are seeing technology and innovation. So

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Speaker 1: what's happening in that space? We have done a show

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Speaker 1: on direct air capture in the past, but are things

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Speaker 1: heating up with investment on those sorts of technologies and

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Speaker 1: are there interesting things that are happening.

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Speaker 2: Yeah, So I think DAK is the outlier here because

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Speaker 2: while traditionals is tapering off, for interest in traditional ccs

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Speaker 2: is tapering off seemingly right now, we have seen a

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Speaker 2: continuous interest in direct air capture. Apart from DOE funding,

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Speaker 2: there's been an uptick and VCPE funding as well. So

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Speaker 2: I think it was two Q twenty twenty two was

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Speaker 2: the last largest quarter for direct air capture and that

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Speaker 2: was primarily this climb Works deal. I think they raised

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Speaker 2: over six hundred million dollars in funding, and then twenty

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Speaker 2: twenty three, we saw investment or interest taper off a

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Speaker 2: little bit, but still remain relatively consistent, and then Q

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Speaker 2: one of twenty twenty four was the largest quarter we've

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Speaker 2: seen since that big climb Works investment, and that's primarily

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Speaker 2: you know, carbon capture. I think they had a eighty

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Speaker 2: million dollar deal in Series A, and then we've also

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Speaker 2: seen avnos take home some money as well. So it's

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Speaker 2: kind of this next generation of not technology particularly, but

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Speaker 2: this next generation of startups that are seeing more movement

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Speaker 2: into the market.

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Speaker 1: So on the techie side of things, can you get

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Speaker 1: me excited about direct air capture and what's actually happening there.

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Speaker 2: Yeah, So you can kind of think of it as

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Speaker 2: DAK one point zero, DAK two point zero, and then

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Speaker 2: maybe DAK three point zero, So the traditional forms of

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Speaker 2: direct air capture, and we can talk about companies here.

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Speaker 2: It's climb Works Global Thermostat Carbon Engineering. They're using this

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Speaker 2: thermal driver as a catch and release. You catch CO two.

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Speaker 2: You kind of use this temperature swing to release the

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Speaker 2: CO two from the capture medium. And unfortunately, due to

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Speaker 2: the low concentration of CO two in the atmosphere, you

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Speaker 2: need a very high thermal requirement to strip that CO

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Speaker 2: two from the medium and capture the COO two as well.

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Speaker 2: So these technologies right now are pretty expensive. And what

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Speaker 2: we're seeing is a divergence away from the traditional thermal swing.

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Speaker 2: So we're seeing vacuum swing, but more innovative, we're seeing

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Speaker 2: this electrochemical swing. And so how can you either manipulate

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Speaker 2: the pH or manipulate the voltage to catch and release

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Speaker 2: COO two invite utilizing an avenue like electrochemical capture, you

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Speaker 2: can see dramatic declines and energy requirements. And so we're

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Speaker 2: seeing this DAK two point zero or DAK three point zero,

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Speaker 2: the new innovations of startups and technologies utilizing that lever

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Speaker 2: rather than temperature for example.

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Speaker 1: So, keeping within theme of carbon removal technology in a

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Speaker 1: broad sense, what are some of the other technologies that

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Speaker 1: are out there? I mean, recently I heard the term

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Speaker 1: direct ocean removal, and I'm going to be perfectly honest,

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Speaker 1: I'm not entirely sure if we're removing carbon from the

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Speaker 1: ocean or using the ocean to capture carbon, because it's

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Speaker 1: a carbon sinc.

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Speaker 2: I mean, it's both. You can see direct ocean removal

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Speaker 2: as a lever to just enhance the ocean's natural carbon cycle.

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Speaker 2: There's a bunch of different methods of how the ocean

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Speaker 2: or different technologies that are trying to manipulate the ocean

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Speaker 2: to capture CO two. You know, there's enhanced weathering, there's

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Speaker 2: ocean alkalinity enhancement. Some startups are using macroalgae so growing

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Speaker 2: kelp to sequester CO two, and then they're trying to

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Speaker 2: sync that to the bottom of the ocean. A lot

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Speaker 2: of these startups aren't working. A lot of the science

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Speaker 2: is a little finicky.

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Speaker 1: This reminds me of an article I saw on April

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Speaker 1: Fool's Day that was pointing out that whales themselves, because

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Speaker 1: we're all made of carbon, if the world just had

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Speaker 1: more whales and then they sunk to the bottom of

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Speaker 1: the ocean, we could sequester carbon that way. You know,

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Speaker 1: am I wrong in thinking that some of this is

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Speaker 1: sounding like it might be on the fringes of scalable technology?

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Speaker 2: And those are actually called whale falls. There's a funny

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Speaker 2: little scientific term for it. When, yeah, a whale dies

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Speaker 2: and I sink to the bottom of the ocean. And

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Speaker 2: we've actually tried to do a study on how much

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Speaker 2: carbon those do sequester and I think there's a number

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Speaker 2: out there, but I just don't have it on the

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Speaker 2: top of my head.

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Speaker 1: So not just for April first whale falls.

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Speaker 2: Whale falls is real. Yes, it's a real thing. Yeah,

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Speaker 2: you can say a lot of the like macrolgyl sequestration,

434
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Speaker 2: which is basically that just using kelp. It's just really

435
00:22:57,760 --> 00:23:01,840
Speaker 2: hard to monitor report verify how many tons of CO

436
00:23:02,040 --> 00:23:04,560
Speaker 2: two are actually being sequestered if you're just sinking something

437
00:23:04,560 --> 00:23:06,840
Speaker 2: to the bottom of the ocean, especially when you look

438
00:23:06,880 --> 00:23:10,520
Speaker 2: at the natural ocean cycle, that seaweed realistically could just

439
00:23:10,560 --> 00:23:13,679
Speaker 2: be washed back up in the tide and back onto shore.

440
00:23:13,880 --> 00:23:16,320
Speaker 2: So it's pretty tricky to measure things like that. If

441
00:23:16,359 --> 00:23:19,320
Speaker 2: you're looking at kind of the technology that is receiving

442
00:23:19,359 --> 00:23:22,560
Speaker 2: some better attention, I think Captura is one of the

443
00:23:22,640 --> 00:23:26,480
Speaker 2: leaders here they're using. It's kind of an electrochemical process.

444
00:23:26,880 --> 00:23:31,600
Speaker 2: It's basically you can manipulate the pH of water, either

445
00:23:32,040 --> 00:23:36,320
Speaker 2: dropping it making it more acidic, or you can increase

446
00:23:36,400 --> 00:23:40,000
Speaker 2: the vicicity of the water and therefore create a carbonate

447
00:23:40,040 --> 00:23:42,399
Speaker 2: and either you take a high pH solution or a

448
00:23:42,400 --> 00:23:45,840
Speaker 2: low pH solution, and then you can simply remove the

449
00:23:45,880 --> 00:23:50,880
Speaker 2: CO two from that solution using either a membrane or electrolysis,

450
00:23:51,400 --> 00:23:51,760
Speaker 2: and so.

451
00:23:51,920 --> 00:23:56,359
Speaker 1: Sorts of changes. How do they impact the biodiversity in

452
00:23:56,440 --> 00:23:57,119
Speaker 1: the oceans.

453
00:23:57,880 --> 00:24:01,200
Speaker 2: Yeah, so, and this is speaking broadly to direct otion removal.

454
00:24:01,800 --> 00:24:04,720
Speaker 2: We don't really know. And I think that's the biggest

455
00:24:04,800 --> 00:24:08,199
Speaker 2: environmental factor here with direct ocean removal. And so if

456
00:24:08,200 --> 00:24:10,840
Speaker 2: we're comparing director capture to direct ocean removal, if you're

457
00:24:10,880 --> 00:24:16,320
Speaker 2: looking at technologies that have similar costs, similar energy requirements,

458
00:24:16,680 --> 00:24:21,120
Speaker 2: but one of them has a much higher potential environmental impact,

459
00:24:21,320 --> 00:24:23,560
Speaker 2: you kind of have to look at the opportunity costs

460
00:24:23,640 --> 00:24:27,080
Speaker 2: of spending millions of dollars in one area or millions

461
00:24:27,080 --> 00:24:29,760
Speaker 2: of dollars in the other area. And so that's why

462
00:24:29,760 --> 00:24:33,639
Speaker 2: we're actually right now seeing a greater interest in DAK

463
00:24:34,040 --> 00:24:37,320
Speaker 2: versus store direct otion removal. And we're actually seeing some

464
00:24:37,400 --> 00:24:40,560
Speaker 2: of the more traditional or the first direct otion remobile

465
00:24:40,560 --> 00:24:44,879
Speaker 2: companies start to rebrand and position themselves more as direct

466
00:24:44,920 --> 00:24:47,760
Speaker 2: air capture companies because that's where a lot of you know,

467
00:24:48,040 --> 00:24:51,919
Speaker 2: this immediate investor interest is it's easier to prove to

468
00:24:52,160 --> 00:24:55,320
Speaker 2: you know, a VCPE, your direct air capture system works

469
00:24:55,720 --> 00:24:59,360
Speaker 2: versus your direct otion remobile systems due to these environmental

470
00:24:59,480 --> 00:25:01,280
Speaker 2: you know, issues we're seeing.

471
00:25:01,640 --> 00:25:05,040
Speaker 1: So I can understand though, why companies have looked to

472
00:25:05,320 --> 00:25:08,200
Speaker 1: the ocean as a potential place to store additional carbon,

473
00:25:08,240 --> 00:25:10,159
Speaker 1: because you know, when we think about the amount of

474
00:25:10,200 --> 00:25:12,920
Speaker 1: carbon that's sequestered in the geosphere, one of the things

475
00:25:13,000 --> 00:25:15,399
Speaker 1: that actually was written in one of your reports shows that,

476
00:25:15,520 --> 00:25:18,840
Speaker 1: you know, the atmosphere has eight hundred and thirty gigatons

477
00:25:18,880 --> 00:25:22,359
Speaker 1: of carbon, land has three thousand gigatons of carbon, and

478
00:25:22,400 --> 00:25:26,000
Speaker 1: the ocean has a whopping thirty eight thousand gigatons of

479
00:25:26,000 --> 00:25:28,280
Speaker 1: carbon in it. So you know, we are the blue

480
00:25:28,280 --> 00:25:32,639
Speaker 1: planet and the ocean has this incredible capacity to absorb carbon.

481
00:25:32,800 --> 00:25:36,000
Speaker 1: We'll see how that technology develops. You've gone through a

482
00:25:36,119 --> 00:25:39,199
Speaker 1: number of kind of new and exciting technologies that are

483
00:25:39,200 --> 00:25:42,640
Speaker 1: coming out. We'll see where those actually develop and which

484
00:25:42,720 --> 00:25:45,399
Speaker 1: ones of those are actually able to get their price

485
00:25:45,560 --> 00:25:48,679
Speaker 1: per ton of CO two down to something that is competitive,

486
00:25:48,680 --> 00:25:52,080
Speaker 1: maybe not necessarily with the euts, but with other parts

487
00:25:52,119 --> 00:25:54,439
Speaker 1: of the voluntary market. So what I want to know is,

488
00:25:54,520 --> 00:25:58,560
Speaker 1: as you're thinking about carbon removal technology and this lull,

489
00:25:58,720 --> 00:26:01,080
Speaker 1: one might say in the CC side of things, what

490
00:26:01,160 --> 00:26:03,360
Speaker 1: are you watching most closely.

491
00:26:03,520 --> 00:26:08,200
Speaker 2: In terms of point source, we're really waiting for policy developments.

492
00:26:08,320 --> 00:26:11,040
Speaker 2: That's going to be the litmus test really as to

493
00:26:11,560 --> 00:26:14,720
Speaker 2: if CCS is going to see this resurgence in one

494
00:26:14,800 --> 00:26:18,960
Speaker 2: capacity editions. But I guess almost more importantly investment into

495
00:26:19,040 --> 00:26:22,040
Speaker 2: the projects that we've already seen announced. On the direct

496
00:26:22,080 --> 00:26:27,400
Speaker 2: air capture side, it's really just continuing to incentivize really

497
00:26:27,480 --> 00:26:33,560
Speaker 2: supply because corporate demand outstrips supply significantly, and so it's

498
00:26:33,960 --> 00:26:37,119
Speaker 2: how can we continue to help develop or hone in

499
00:26:37,200 --> 00:26:40,879
Speaker 2: these technologies, maybe pick a couple of winners, because what

500
00:26:40,880 --> 00:26:43,360
Speaker 2: we're seeing right now is there's nearly maybe a thousand

501
00:26:43,440 --> 00:26:46,640
Speaker 2: direct air capture startups, and naturally a lot of those

502
00:26:46,640 --> 00:26:49,600
Speaker 2: are going to be siphoned off. In realistically, what we

503
00:26:49,640 --> 00:26:53,720
Speaker 2: need to see is maybe two three of these technologies

504
00:26:54,000 --> 00:26:58,040
Speaker 2: prevail so that we can coalesce around those particular technologies,

505
00:26:58,080 --> 00:27:00,960
Speaker 2: build the supply chains, and then help the DAK industry

506
00:27:01,000 --> 00:27:04,000
Speaker 2: to scale so we can meet that corporate demand. But again,

507
00:27:04,040 --> 00:27:06,440
Speaker 2: that's just going to continue to take lots of funding

508
00:27:06,760 --> 00:27:09,479
Speaker 2: and more policy from the government because kind of as

509
00:27:09,480 --> 00:27:12,879
Speaker 2: I mentioned before, it is this public good removing CO

510
00:27:13,040 --> 00:27:16,520
Speaker 2: two from the atmosphere, because carbon is a waste product,

511
00:27:16,560 --> 00:27:18,560
Speaker 2: and so realistically, we're going to need mandates from the

512
00:27:18,600 --> 00:27:23,560
Speaker 2: governments to tell corporates to procure DAK purchases continue to

513
00:27:23,680 --> 00:27:26,280
Speaker 2: help subsidize the build out of a lot of these

514
00:27:26,280 --> 00:27:28,440
Speaker 2: plants and things like that. So I think the industry

515
00:27:28,480 --> 00:27:30,679
Speaker 2: right now is really not at a standstill, but I

516
00:27:30,680 --> 00:27:33,760
Speaker 2: think we are waiting idly by to see what a

517
00:27:33,760 --> 00:27:35,280
Speaker 2: lot of these governments are going to do.

518
00:27:35,720 --> 00:27:37,480
Speaker 1: Brenna, thank you so much for coming on the show

519
00:27:37,520 --> 00:27:39,719
Speaker 1: today and for giving us an update on what's happening

520
00:27:39,800 --> 00:27:42,760
Speaker 1: in this space as the world looks to try and

521
00:27:42,840 --> 00:27:44,440
Speaker 1: figure out how we reach in at zero.

522
00:27:44,720 --> 00:27:45,240
Speaker 2: Yeah, thank you.

523
00:27:54,280 --> 00:27:57,399
Speaker 1: Today's episode of Switched On was produced by Cam Gray

524
00:27:57,600 --> 00:28:01,280
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00:28:01,320 --> 00:28:04,439
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00:28:07,240 --> 00:28:11,000
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