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Speaker 1: Pushkin. Sometime around twenty eighteen, it became clear that transitioning

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Speaker 1: away from fossil fuels was not going to be enough

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Speaker 1: to manage climate change. On top of moving away from

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Speaker 1: fossil fuels, on top of ceasing to emit carbon dioxide

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Speaker 1: into the air, the world would also need to figure

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Speaker 1: out how to take some of the carbon dioxide we'd

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Speaker 1: already put into the atmosphere out of the atmosphere. And

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Speaker 1: it was also clear that just planting more trees wasn't

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Speaker 1: going to do it. It was too much carbon dioxide

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Speaker 1: and not enough land to plant trees on. A few

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Speaker 1: years after those things became clear, a company called Stripe,

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Speaker 1: that helps online businesses do things like process payments, decided

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Speaker 1: to dedicate a relatively small amount of money, a million dollars,

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Speaker 1: to pay to have carbon dioxide removed from the atmosphere.

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Speaker 2: Twenty twenty, we made our first purchases from four carbon

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Speaker 2: removal companies.

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Speaker 1: This is Nan rants Off, the head of climate at.

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Speaker 2: Stripe, and at the time, you know, two sort of

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Speaker 2: interesting things happened. The first is that the field had

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Speaker 2: this sort of almost weirdly positive reaction to a pretty.

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Speaker 3: Small amount of money a million dollars is ultimately not

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Speaker 3: that much.

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Speaker 1: It's in a way quite a bad sign if people

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Speaker 1: get excited, yes for a whole field about a million.

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Speaker 2: No, that's exactly right, and it's concerning, like why are

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Speaker 2: people getting so excited about this million dollars? So that

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Speaker 2: was an interesting signal, which to us just said, well,

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Speaker 2: this field has been starved for a market, and that

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Speaker 2: such that a million dollars could you know, make anybody

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Speaker 2: pay attention.

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Speaker 1: The second thing that happened, Nan said, was Stripe started

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Speaker 1: hearing from the companies that used Stripe services, and a

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Speaker 1: lot of those companies also wanted to start paying for

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Speaker 1: carbon removal. So Stripe set up away for those companies

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Speaker 1: to purchase carbon removal and tens of millions of dollars

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Speaker 1: flowed in.

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Speaker 2: Good step, but it's still quite small. So then, you know,

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Speaker 2: we've been doing this for about a year and a

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Speaker 2: half and our team gotten room. We said, well, you know,

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Speaker 2: on the one hand, this is ten x progress. You know,

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Speaker 2: we are making progress, but this number is still so

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Speaker 2: short of what the field needs. And we came up

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Speaker 2: with a bunch of ideas and we killed a bunch

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Speaker 2: of ideas and one of the ideas that we couldn't

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Speaker 2: kill was this concept of an advanced market commitment. That

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Speaker 2: is ultimately what has since become Frontier, which is we've

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Speaker 2: launched a now over one billion dollar advanced market commitment

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Speaker 2: to buy permanent carbon removal between twenty twenty two and

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Speaker 2: twenty thirty and there are still many more steps on

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Speaker 2: the journey, but that's one of the big ones that

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Speaker 2: we've been working on recently.

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Speaker 1: I'm Jacob Goldstein and this is What's Your Problem, the

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Speaker 1: show where I talk to people who are trying to

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Speaker 1: make technological progress. In addition to being a head of

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Speaker 1: Climate at Stripe, Nan Ransohoff is also head of Climate

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Speaker 1: at Frontier. That's the organization she mentioned a minute ago.

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Speaker 1: Frontier is a wholly owned subsidiary of Stripe, and it

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Speaker 1: is the vehicle through which Stripe and a bunch of

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Speaker 1: other companies have pledged to pay one billion dollars to

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Speaker 1: have carbon permanently removed from the atmosphere. I wanted to

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Speaker 1: talk to Nan for a couple reasons. One, her job

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Speaker 1: gives her a great overview of what is going on

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Speaker 1: in carbon removal as a field, and two, the specific

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Speaker 1: mechanism that Frontier is using that advanced market commitment that

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Speaker 1: Nan mentioned. Is this really powerful, relatively recent economic innovation.

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Speaker 1: So what's an advanced market commitment?

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Speaker 2: An advanced market commitment is basically a way to guarantee

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Speaker 2: future demand for a product that you want to exist

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Speaker 2: but that doesn't exist yet. And advanced market commitments are

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Speaker 2: a basically a kind of way of collecting revenue and

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Speaker 2: demonstrating that there is a market for a product. And

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Speaker 2: we borrow this concept actually from the vaccine space. So

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Speaker 2: the first AMC was started in the mid two thousands

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Speaker 2: for the world wanted a new macco vaccine for low

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Speaker 2: and middle income countries and because the end customers are

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Speaker 2: from less wealthy countries, if pharma companies are not incented

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Speaker 2: to actually develop that vaccine because the end demand is

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Speaker 2: uncertain or small.

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Speaker 1: Right, it's not going to be a profitable enterprise probably, Right.

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Speaker 1: They're going to spend hundreds of millions of dollars a

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Speaker 1: billion dollars to develop a vaccine and the price at

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Speaker 1: which they could sell it is not enough to recoup

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Speaker 1: their investment. And we should say I feel like the

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Speaker 1: new macacco vaccine is underrated in part just because of

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Speaker 1: the name. Like I think that you know, this is

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Speaker 1: a terrible infection that killed huge numbers of children, and

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Speaker 1: it was clearly vaccine preventable. And there was this frankly

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Speaker 1: economic problem was the vaccine didn't exist, and how could

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Speaker 1: people with money in the rich world create the incentive

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Speaker 1: structure for it to be worth it for a private

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Speaker 1: company to develop the vaccine?

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Speaker 2: Very well said yes, And that is a generalizable concept

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Speaker 2: of AMC's is that they're trying to there's a public

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Speaker 2: good or something that is of real value, societal value

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Speaker 2: that should happen, but there's an incentive problem that is

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Speaker 2: preventing that from happening. And AMCs are one of a

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Speaker 2: broader set of what economists would call market shaping tools

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Speaker 2: that we can utilize to help fix those incentive problems

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Speaker 2: and make it more likely that these public goods these

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Speaker 2: societal goods actually exist and scale up to the numbers

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Speaker 2: that we want them to.

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Speaker 1: Well, And AMCs are a little bit like clever, subtle,

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Speaker 1: non obvious, right, Like the more obvious thing is like, well,

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Speaker 1: the government could just spend money to develop a vaccine,

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Speaker 1: or even could just subsidize one vaccine maker to do

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Speaker 1: the research it, but like why is an AMC better

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Speaker 1: in some settings than those options.

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Speaker 2: Yeah, it's a really good question. So when we think

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Speaker 2: about the types of financial interventions here, we can think

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Speaker 2: about them like push. People often talk about push mechanisms

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Speaker 2: are like grant funding. You typically pay for folks to

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Speaker 2: upfront for an input.

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Speaker 1: An input in this case is research vaccine development.

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Speaker 3: Yep, you're giving someone a grand.

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Speaker 1: Here's a billion dollars go make the vaccine.

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Speaker 2: Or you're giving somebody a grant to figure out if

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Speaker 2: it's even possible, and you're giving them upfront before you

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Speaker 2: get the end outcome. Pull funding are mechanisms that you're

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Speaker 2: paying for something when it's delivered, you're paying.

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Speaker 3: For the output.

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Speaker 2: And a prize an is sort of an example of that.

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Speaker 2: It's like a one time if somebody can develop this,

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Speaker 2: we'll give you a prize.

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Speaker 1: And there are famous examples of this. I think Longitude

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Speaker 1: the British and was it the eighteenth century they needed

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Speaker 1: to they needed a clock that worked on a ship

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Speaker 1: that's basically right. Or the DARPA Prize for self driving

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Speaker 1: cars right, which sort of kicked off the self driving

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Speaker 1: car revolution.

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Speaker 2: Prizes can be very effective mechanisms, and AMCs are not

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Speaker 2: always a good fit for a problem. They tend to

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Speaker 2: be a good fit for the problem when a couple

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Speaker 2: of things are true. If you think about the thing

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Speaker 2: you want to exist, and why the organizations are the

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Speaker 2: people that could have invented and scaled those things aren't

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Speaker 2: doing it. The problem in their mind is there's no

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Speaker 2: end revenue for it. That's criteria one. Criteria two is

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Speaker 2: that you can actually define the thing that you want

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Speaker 2: to exist. So you can we, in this case, define

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Speaker 2: the target product profile of the new macagual vaccine that

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Speaker 2: we want, or in our case, can we outline the

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Speaker 2: criteria for the kinds of carbon removal that we want

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Speaker 2: to exist. And then a third criteria is essentially like,

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Speaker 2: once the thing is actually invented, will market forces take

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Speaker 2: over to actually make it scale on its own. So basically,

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Speaker 2: if once a thing invented that is true, you should

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Speaker 2: do a prize because you don't need a long term market.

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Speaker 3: You're just trying to get the initial invention interesting.

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Speaker 2: But in the case of you know, the new macaco vaccine,

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Speaker 2: for example, you want the pharma companies to invent the solution,

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Speaker 2: but you ultimately care about is that the people who

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Speaker 2: needed are getting the vaccine. So in that case, the

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Speaker 2: incentive design there is you're taking all of the R

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Speaker 2: and D and development costs associated with that, but you

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Speaker 2: are giving it back to the pharma companies by amortizing

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Speaker 2: it over all of the doses.

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Speaker 1: So, just to be clear, the advanced market commitment for

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Speaker 1: the vaccine was not will give you the money when

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Speaker 1: you invent the vaccine. It's will pay an extra couple

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Speaker 1: bucks per vaccine delivered in the field in this part

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Speaker 1: of the world exactly.

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Speaker 2: And there are genuinely different ways. AMCs are a pretty

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Speaker 2: broad term that you know, can encompass a lot of

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Speaker 2: different sure mechanism designs. But you described that well, it's

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Speaker 2: like you want to you're paying for the outcome of

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Speaker 2: somebody actually getting the vaccine.

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Speaker 1: The marginal use cast. Yeah, okay, By the way, are

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Speaker 1: there more criteria or do we have the criteria now

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Speaker 1: in place?

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Speaker 2: Those are sort of rough criteria that and they're not perfect,

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Speaker 2: but there's sort of rough criteria that will help you know.

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Speaker 2: Are we even in pull funding territory and within pull

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Speaker 2: funding should be considered an AMC versus a prize versus

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Speaker 2: something else. Those are sort of loose guiding criteria.

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Speaker 1: So now we have our framework, apply it to carbon removal.

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Speaker 1: As you were thinking about it in twenty twenty one,

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Speaker 1: twenty twenty two, why did it seem like a good

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Speaker 1: fit for that problem at that time?

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Speaker 2: Yeah, I mean, I think a fundamental problem with carbon removal.

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Speaker 2: So carbon removal is, for all intents and purposes, it

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Speaker 2: is a public good. Unlike with energy. You know, humans

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Speaker 2: derive value from energy. That is, we get value from that.

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Speaker 2: When you are secking CO two out of the atmosphere

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Speaker 2: and storing it somewhere permanently. You know, there are small

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Speaker 2: markets where people can benefit from them. You're using the

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Speaker 2: CO twos, you know, an end product, But at the

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Speaker 2: scale we're talking this is mostly a public good. And

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Speaker 2: as a result, it is a very reasonable question for

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Speaker 2: entrepreneurs and investors to basically ask, if I start company

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Speaker 2: in this space, who's going to buy the end product

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Speaker 2: that I am selling? It is fundamentally a open question

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Speaker 2: about the market. And I would say it's even more

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Speaker 2: of an open question if I'm building a really early

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Speaker 2: stage technology that is expensive at the beginning, because there

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Speaker 2: are now there's some voluntary market that exists, but that's

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Speaker 2: a twenty dollars a ton, and if you're building, you know,

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Speaker 2: a new technology at the beginning, your price is going

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Speaker 2: to be high. And so that fundamentally that first criteria

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Speaker 2: is extremely applicable to carbon removal because it is created

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Speaker 2: as chicken and egg problem that we're trying to solve.

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Speaker 1: You use the term public good, which people use in

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Speaker 1: a kind of vernacular sense, but there's a technical economic

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Speaker 1: sense in which you are using it and which applies here,

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Speaker 1: right MLL. It's non rivalrous and non excludable, right, which

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Speaker 1: means basically, even if only one person pays for it,

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Speaker 1: everybody benefits, and you can't even exclude somebody from benefiting

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Speaker 1: if you want to, that's right, right. A lighthouse is

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Speaker 1: the classes, that's right. Right. It doesn't make sense for

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Speaker 1: any one shipping company to pay for a lighthouse because

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Speaker 1: all those other cheap assholes who didn't pay for the

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Speaker 1: lighthouse are also not going to crash into the boxes, right.

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Speaker 1: And it's a classic case of market failure for that reason, right,

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Speaker 1: because the person paying for it only captures a tiny

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Speaker 1: and in the case of carbon removal, truly tiny, tiny

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Speaker 1: part of the benefit, and so no one's going to

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Speaker 1: pay for it, except in like weird edge cases, well

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Speaker 1: said like stripes one million.

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Speaker 3: Dollars precisely, precisely.

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Speaker 1: Yes, okay, so that's good. That's one.

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Speaker 3: What else that's very important one?

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Speaker 2: The second one is can we define the shape of

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Speaker 2: the thing that we want to exist? And in our case,

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Speaker 2: when we're thinking about carbon removal, we have a set

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Speaker 2: of criteria that we are that sort of try to

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Speaker 2: characterize the gap in solutions that exist that would essentially

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Speaker 2: get the world to the ten gigatons plus career needed

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Speaker 2: by twenty fifty. Okay, So the kinds of things that

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Speaker 2: we care about on this list are things like does

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Speaker 2: this technology have the potential to be under one hundred

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Speaker 2: dollar in the future, And that is a you know,

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Speaker 2: we can come back to the specifics, but does it

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Speaker 2: have the potential to be cheap? Does it have the

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Speaker 2: potential to be very huge? We're looking at solutions that

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Speaker 2: have the potential to be more than half a gig

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Speaker 2: aten per year in carbon removal.

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Speaker 3: We also care a lot about permanence.

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Speaker 2: So when you emit a ton of CO two into

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Speaker 2: the atmosphere, that is permanently up there, and so we

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Speaker 2: want to take it out permanently as well. And then

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Speaker 2: you know, there's a whole host of other criteria that

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Speaker 2: we care about. But when we sat down to do

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Speaker 2: our initial million dollar spend for stripes that first blog post,

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Speaker 2: we spend a lot of time thinking about, you know,

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Speaker 2: how do we characterize the kinds of solutions that we

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Speaker 2: want to exist? And an important part of that characterization

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Speaker 2: is can we be specific enough that people understand what

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Speaker 2: it is that we want, but can we be broad

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Speaker 2: enough to invite a whole host of creative solutions to

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Speaker 2: the starting line, Because this entire field is basically, you know,

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Speaker 2: six years old. This started, you know, carbon removal. The

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Speaker 2: starting gun for carbon removal was a twenty eighteen ACCC

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Speaker 2: report and that was not very long ago. And so

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Speaker 2: maybe it's direct air capture. Maybe it's enhance rock weathering,

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Speaker 2: maybe it's ocean alkalinity enhancement. Maybe you know, there's all

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Speaker 2: these different solutions. Let it's too early to pick a horse.

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Speaker 2: Let's get a bunch of the best ideas to the

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Speaker 2: starting line, see how they do, and then some of

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Speaker 2: them won't work, but the ones that do, let's really

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Speaker 2: double down. So that's a long wooded way of saying

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Speaker 2: we were trying to define that this target criteria in

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Speaker 2: a way that sort of balanced the specificity needed to

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Speaker 2: guarantee this for suppliers, but also was broad enough to

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Speaker 2: invite the innovation that we think is necessary.

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Speaker 1: Yeah. I mean, well that's the market force part, right,

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Speaker 1: That's why it's a poll. If it's too specific, then

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Speaker 1: it's like, well, just give a grant to one company.

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Speaker 1: But that's what you're trying to avoid, right, You're trying

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Speaker 1: to avoid picking a winner, precisely. Is there one more criterion?

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Speaker 2: And there's one more criteria, which is essentially, once the

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Speaker 2: thing is invented, if you have the recipe for the thing,

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Speaker 2: our market force is going to scale it up on

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Speaker 2: its own. And in the case of carbon removal, somebody

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Speaker 2: could come up with the best possible solution and the

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Speaker 2: long term market for this isn't quite there yet.

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Speaker 1: It's the public good problem again, exactly. So yes, So

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Speaker 1: it's yes, yes, and yes to your three criteria for

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Speaker 1: advanced market commitment.

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Speaker 2: Yes, And I will say that, like, there's a few

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Speaker 2: differences in this in the frontier AMC and the initial

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Speaker 2: AMC for New maccacle. I think one of the things

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Speaker 2: that is challenging in carbon removal is that lack of

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Speaker 2: long term market. So like frontiers a billion dollars, it's

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Speaker 2: going to run out eventually, so we're sort of building

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Speaker 2: the plane while we're flying it. We have to make

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Speaker 2: sure that once these initial funds are out, that long

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Speaker 2: term market does exist.

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Speaker 3: So we can talk about what that looks like.

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Speaker 2: But I think that you know, in the case of

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Speaker 2: the new Maccacle vaccine for low middle income countries, there

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Speaker 2: was a point at which it made sense financial sense

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Speaker 2: once for pharma companies to continue to st reading the

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Speaker 2: vaccine on their own. In our case, you know, that

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Speaker 2: is only true if we can also put a sort

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Speaker 2: of semi state market in place.

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Speaker 1: If that makes sense, Yeah, I mean is it? Because

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Speaker 1: for the for the vaccine, most of the cost is

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Speaker 1: upfront exactly, and in fact there is marginal benefit for

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Speaker 1: people who can pay a very small amount or for

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Speaker 1: countries that can pay a very small amount, so there

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Speaker 1: is once the vaccine companies have recouped the R and

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Speaker 1: D cost, the marginal cost actually works in a market

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Speaker 1: based way, which will never be true for a carbon

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Speaker 1: capture because it's a public good, that's right. So I

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Speaker 1: was thinking, we get to this later. But whatever fundamentally,

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Speaker 1: there is a policy problem that somebody has to solve

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Speaker 1: before too long, because this isn't going to work forever,

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Speaker 1: you wrote, without government action. Frontier is building a bridge

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Speaker 1: to nowhere.

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Speaker 2: Yes, these private sector of voluntary commitments are a great

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Speaker 2: way to help this field get to first base, but

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Speaker 2: they are not going to get us all way there.

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Speaker 2: So you know, if we if we zoom all the

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Speaker 2: way out and think about to quick demand mouth, how

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Speaker 2: big does this market need to be in for how long?

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Speaker 2: So carbon removal roughly needs to scale to and this

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Speaker 2: is rough numbers ten billion tons per year by twenty fifty.

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Speaker 2: And if we say that, you know, for example, we

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Speaker 2: think we can do it at one hundred.

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Speaker 3: Dollars a time.

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Speaker 2: Okay, that is a trillion dollars per year okay, in

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Speaker 2: demand that is needed. And of course if we end

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Speaker 2: up needing less carbon removal, that numbers goes down, and

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Speaker 2: if we can do it for cheaper, that numbers go down.

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Speaker 1: But just back of the envelope, it's a trillion dollars

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Speaker 1: a year, which is a big number. Right.

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Speaker 3: Global GDP is about one hundred trillion.

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Speaker 1: Dollars, So one percent of global GDP is a tremendous,

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Speaker 1: a tremendously large number that it is dauntingly large.

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Speaker 3: In fact, it's dauntingly large.

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Speaker 1: Can you get another order of magnitude out of the price?

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Speaker 1: It's the first question I have for you.

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Speaker 2: So I think that that is why it really matters

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Speaker 2: that we are so hunting for a solution that can

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Speaker 2: be much cheaper, because you know, being able to get

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Speaker 2: down to seventy or fifty or thirty dollars a ton

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Speaker 2: does make a really big difference. Yeah, I would call

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Speaker 2: out though that like, is half a percent or a

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Speaker 2: percent of global GDP a lot? I mean, of course

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Speaker 2: the answer is in one sense yes, But of course

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Speaker 2: as a current moment a tough.

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Speaker 3: Time to be getting countries to coordinate on global public goods.

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Speaker 2: But it's not totally out of the realm of possibility,

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Speaker 2: especially if and as the world gets richer that percentage

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Speaker 2: goes down.

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Speaker 1: Well, So, okay, fine, we're saying all these numbers. It's

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Speaker 1: a lot of money, but what does it mean in

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Speaker 1: terms of policy? Right, it's fundamentally a public good. Public

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Speaker 1: goods we know the most basic economic way are not

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Speaker 1: provided by the market, So like, what do governments have

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Speaker 1: to do to sort of take the baton from Frontier.

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Speaker 2: I think that probably in practice, the collection of policies

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Speaker 2: that get to these hundreds of billions of dollars per

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Speaker 2: year ends up looking like a patchwork quilt of demand policies.

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Speaker 2: I think it is unlikely that there is sort of

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Speaker 2: one thing that ultimately gets us there.

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Speaker 3: We can talk about what the shape of.

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Speaker 2: Those things could look like, but at a high level

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Speaker 2: you can kind of imagine a couple of different worlds.

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Speaker 2: One world is that governments treat carbon removal like sanitation,

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Speaker 2: and they say, you know, going to We're going to

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Speaker 2: do this clean up on behalf of our citizens, and

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Speaker 2: we're going to coordinate with other countries to do that.

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Speaker 2: We could put that in the kind of category of

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Speaker 2: like direct government procurement. Governments are the ones that are

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Speaker 2: doing it themselves. There's another worldview, which is that governments

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Speaker 2: are essentially trying to quantify the negative externality of a

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Speaker 2: ton of emissions and then push that onto the players

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Speaker 2: that are emitting, private companies.

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Speaker 1: Some kind of carbon tax. Basically that is funding carbon removal.

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Speaker 3: Yes about the other thing, Yes, the dream, the dream.

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Speaker 1: Let's dream about a carbon tax for one moment, because

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Speaker 1: it makes so much.

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Speaker 2: Sense, and they are different, and there are different sort

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Speaker 2: of ways of implementing that that I think are sort

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Speaker 2: of further or closer to a traditional carbon taxing. So

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Speaker 2: that's a long winded way of saying there are a

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Speaker 2: whole host of bets I think that the world needs

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Speaker 2: to make, and some of them will pan out and

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Speaker 2: some of them won't. But it is very important to

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Speaker 2: start planning those seeds now so that the market is

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Speaker 2: where it needs to be when it needs to be there.

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Speaker 1: We'll be back in just a bit. Let's go back

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Speaker 1: to the recent past. So you have this idea for

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Speaker 1: big advanced market commitment for carbon capture and removal.

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Speaker 2: What do you do you know at the time AMC's there,

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Speaker 2: there only really been sort of one or one and

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Speaker 2: a half AMC's and they were all in the context

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Speaker 2: of health. So is this Initially mccaggo vaccine AMC GAVY

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Speaker 2: and then Operation Warp Speed incorporated some components of this

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Speaker 2: as well, for to.

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Speaker 1: Develop the coronavirus fix to great success, to great success, underrated,

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Speaker 1: so underrated operation like nobody wants to own it politically,

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Speaker 1: which is so sad. Like it was great, it worked,

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Speaker 1: it was amazing.

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Speaker 3: It was amazing.

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Speaker 1: So what is Frontier at launch in twenty twenty two.

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Speaker 2: What we wanted to do with Frontier, the spirit of

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Speaker 2: what we wanted to do was say, there is a

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Speaker 2: big market for carbon removal and what does that mean?

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Speaker 3: A big market? A billion dollars.

401
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Speaker 2: Was an imperfect number that we came up with that

402
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Speaker 2: was that both met the criteria of it. We thought

403
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Speaker 2: it would be big enough to get people's attention and

404
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Speaker 2: send a strong signal to entrepreneurs and investors that there

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Speaker 2: is a market, but it was still something we felt

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Speaker 2: was in the realm of possibility, Like we can't go

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Speaker 2: raise one hundred trill you know, a trillion dollars that

408
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Speaker 2: is that is not something we were able to do.

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Speaker 2: So a billion dollars was the number that we settled on.

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Speaker 2: I will sort of want to asterix and call out

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Speaker 2: the fact that like it is a sort of imperfect

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Speaker 2: number because it does not solve the whole problem.

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Speaker 1: Kind of the minimum viol both number in contact.

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Speaker 2: That's exactly right, Yeah, and that's different than the new

415
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Speaker 2: Macauga vaccine. Like you know, initially when they put together

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Speaker 2: the billion and a half dollars from countries and the

417
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Speaker 2: Gates Foundation that they thought it was enough to get

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Speaker 2: the vaccine to the point that they wanted to get to,

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Speaker 2: So I will sort of call out the flaw in that,

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Speaker 2: but we said, okay, a billion dollars Stripe can put

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Speaker 2: in some of that. We have now tens of thousands

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Speaker 2: of Strike Climate users that are giving money for carbon removal.

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Speaker 3: So in the context of Stripe.

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Speaker 2: We were actually able to underwrite a huge amount of

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Speaker 2: that initial billion dollars ourselves, but we weren't able to

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Speaker 2: get to that full billion. So we said, okay, how

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Speaker 2: can we find other like minded organizations that would be

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Speaker 2: interested in sort of this kind of wonky experiment that

429
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Speaker 2: we want to try and run. And so we ended

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Speaker 2: up in the spring of twenty twenty two launching with

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Speaker 2: Google and Shopify and McKenzie and since then have added

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Speaker 2: other folks like you know, JP Morgan and h and

433
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Speaker 2: M and Autodesk work Day and the numbers have grown.

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Speaker 3: But at the time it was.

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Speaker 2: Sort of, how do we get as close to that

436
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Speaker 2: billion dollars as number as we can, as fast as

437
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Speaker 2: we can, because these suppliers need as much time as

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Speaker 2: they as they could possibly get to build.

439
00:22:23,436 --> 00:22:26,876
Speaker 1: And so what everybody who puts money into that pot

440
00:22:26,916 --> 00:22:30,196
Speaker 1: is promising is we will buy this amount of money,

441
00:22:30,236 --> 00:22:33,236
Speaker 1: this number of millions or hundreds of millions of dollars

442
00:22:33,396 --> 00:22:38,156
Speaker 1: worth of carbon removal if it needs some set of

443
00:22:38,196 --> 00:22:42,956
Speaker 1: specifications some time between now and twenty thirty. That is

444
00:22:42,996 --> 00:22:46,836
Speaker 1: what everybody is promising, like contractually promising to do yes.

445
00:22:46,876 --> 00:22:48,316
Speaker 3: That is the spirit of what it is.

446
00:22:48,436 --> 00:22:53,156
Speaker 2: And in practice, most of those dollars get spent and

447
00:22:53,316 --> 00:22:56,956
Speaker 2: contracted through something called an off take agreement, and an

448
00:22:56,996 --> 00:23:00,156
Speaker 2: off take agreement is a legally binding contract between a

449
00:23:00,276 --> 00:23:02,876
Speaker 2: buyer and a supplier that the buyer is going to

450
00:23:03,156 --> 00:23:05,596
Speaker 2: buy a certain number of in our case tons at

451
00:23:05,596 --> 00:23:09,836
Speaker 2: a certain price if the supplier can deliver. So when

452
00:23:09,916 --> 00:23:13,876
Speaker 2: companies initially signed up to Frontier, they basically said, you know,

453
00:23:13,956 --> 00:23:16,356
Speaker 2: we're going to put in two hundred million dollars and

454
00:23:17,076 --> 00:23:19,036
Speaker 2: this is how we are sort of able to budget

455
00:23:19,116 --> 00:23:21,236
Speaker 2: that each year from twenty twenty two twenty thirty. And

456
00:23:21,236 --> 00:23:24,156
Speaker 2: at that point it's it's an intention. It's an intention

457
00:23:24,236 --> 00:23:26,916
Speaker 2: to spend, but it's not a legally binding contract. It

458
00:23:27,036 --> 00:23:30,076
Speaker 2: becomes a legally binding contract in these off take agreements

459
00:23:30,116 --> 00:23:33,636
Speaker 2: where buyers are prompting to buy a certain number.

460
00:23:33,436 --> 00:23:34,236
Speaker 3: Of tons of certain price.

461
00:23:34,636 --> 00:23:37,156
Speaker 2: And the reason that off take important contracts are really

462
00:23:37,196 --> 00:23:40,636
Speaker 2: important for carbon removal companies is because if you are

463
00:23:40,636 --> 00:23:42,396
Speaker 2: a carbon removal company and you want to build a

464
00:23:42,436 --> 00:23:44,716
Speaker 2: big new, say dock facility.

465
00:23:44,516 --> 00:23:46,716
Speaker 1: That's direct air catch direct air cash, and.

466
00:23:46,676 --> 00:23:48,436
Speaker 2: You go to a bank and you're like, I want

467
00:23:48,436 --> 00:23:50,876
Speaker 2: to loan to actually finance the bill. The first question

468
00:23:50,876 --> 00:23:53,316
Speaker 2: they're going to ask you is who's going to buy

469
00:23:53,356 --> 00:23:55,436
Speaker 2: the thing that comes off of this plant? Right?

470
00:23:55,716 --> 00:23:57,556
Speaker 1: If they if they take the time to talk to

471
00:23:57,556 --> 00:23:59,796
Speaker 1: you at all, yes, they're going to say, you want

472
00:23:59,836 --> 00:24:02,956
Speaker 1: to build this thing that nobody's ever built before, and

473
00:24:02,996 --> 00:24:04,516
Speaker 1: you don't know who's going to pay you for it,

474
00:24:04,596 --> 00:24:06,516
Speaker 1: and it's a public good, so why should anybody even

475
00:24:06,556 --> 00:24:09,116
Speaker 1: bother to pay for it? So basically a company gets

476
00:24:09,196 --> 00:24:11,156
Speaker 1: an off take agreement and then they can take that

477
00:24:11,316 --> 00:24:14,396
Speaker 1: literally to the bank and use it as collateral for.

478
00:24:14,396 --> 00:24:16,396
Speaker 2: A loan exactly. And there's a lot of other things

479
00:24:16,436 --> 00:24:18,356
Speaker 2: as you've called out, that have to go write in

480
00:24:18,476 --> 00:24:22,116
Speaker 2: order for that loan to actually happen. But one of

481
00:24:22,116 --> 00:24:25,276
Speaker 2: the things that this helps the risk is is the

482
00:24:25,316 --> 00:24:27,956
Speaker 2: demand side, is there a customer to buy the end

483
00:24:27,996 --> 00:24:28,796
Speaker 2: thing that we're doing.

484
00:24:29,076 --> 00:24:32,476
Speaker 1: That's the genius of the advanced market commitment fundamentally, right,

485
00:24:32,756 --> 00:24:35,476
Speaker 1: That's right. So how's it going. You're three years in

486
00:24:35,676 --> 00:24:39,596
Speaker 1: out of eight, right, so like things are happening. You're

487
00:24:39,676 --> 00:24:41,436
Speaker 1: kind of in the middle now of the project.

488
00:24:41,956 --> 00:24:44,796
Speaker 2: Yes, the goal, our goal at Frontier at a very

489
00:24:44,876 --> 00:24:48,076
Speaker 2: high level is to get carbon removal on its best

490
00:24:48,076 --> 00:24:51,276
Speaker 2: possible trajectory. We are sort of working on behalf of

491
00:24:51,276 --> 00:24:56,156
Speaker 2: the ecosystem, largely through these off take agreements. But our goal,

492
00:24:56,276 --> 00:24:58,596
Speaker 2: you know is sort of is very world first and

493
00:24:59,116 --> 00:25:01,676
Speaker 2: by the numbers. So we're, as you said, about three

494
00:25:01,716 --> 00:25:05,596
Speaker 2: years in. We have contracted now over five hundred million

495
00:25:05,676 --> 00:25:10,236
Speaker 2: dollars with several dozen carbon removal companies, and so much

496
00:25:10,236 --> 00:25:14,036
Speaker 2: of our time at Frontier is spent sourcing, getting to

497
00:25:14,156 --> 00:25:18,036
Speaker 2: know and diligencing and ultimately writing contracts with the best

498
00:25:18,036 --> 00:25:20,676
Speaker 2: carbon removal companies out there. And we're, you know, we

499
00:25:20,716 --> 00:25:24,356
Speaker 2: obsess over how to spend and how to contract each

500
00:25:24,396 --> 00:25:25,036
Speaker 2: of these dollars.

501
00:25:25,236 --> 00:25:27,636
Speaker 1: You've committed half of the pot so far.

502
00:25:27,956 --> 00:25:31,076
Speaker 2: We've committed half of the pot across several dozen companies.

503
00:25:31,196 --> 00:25:34,236
Speaker 2: And these companies cover lots of different pathways, some of

504
00:25:34,276 --> 00:25:39,116
Speaker 2: which we've talked about, and in some sense it's too

505
00:25:39,196 --> 00:25:43,596
Speaker 2: early to tell if things are quote unquote like definitely working.

506
00:25:43,636 --> 00:25:45,156
Speaker 3: But we look at some leading.

507
00:25:44,876 --> 00:25:48,676
Speaker 2: Indicators to tell us what to help us triangulate, like

508
00:25:48,996 --> 00:25:50,556
Speaker 2: is this doing the thing that we wanted it to

509
00:25:50,596 --> 00:25:53,556
Speaker 2: be doing. And one of those leading indicators is like,

510
00:25:53,596 --> 00:25:55,756
Speaker 2: what is the number of companies for whom sort of

511
00:25:55,836 --> 00:25:58,556
Speaker 2: Frontier was the first customer. And the reason that we

512
00:25:58,596 --> 00:26:01,876
Speaker 2: hear about that metric is we're trying to pull this

513
00:26:01,956 --> 00:26:05,796
Speaker 2: field forward, So like going early versus following on is

514
00:26:05,836 --> 00:26:09,076
Speaker 2: a good indicator that we're like, yeah, we're pulling companies forward.

515
00:26:09,236 --> 00:26:10,836
Speaker 1: And I mean, you want you want to be the

516
00:26:10,916 --> 00:26:13,396
Speaker 1: marginal buyer, right, you want to be the buyer that

517
00:26:13,436 --> 00:26:15,636
Speaker 1: they need if somebody else was going to buy it anyways,

518
00:26:15,676 --> 00:26:17,876
Speaker 1: that's not as useful, right at some level exactly.

519
00:26:17,916 --> 00:26:19,796
Speaker 2: And we because you know, we're not hunting for the

520
00:26:19,836 --> 00:26:22,596
Speaker 2: cheapest tons, We're looking long term at you know, our

521
00:26:23,276 --> 00:26:25,756
Speaker 2: we're looking for technologies that have the potential to be

522
00:26:25,796 --> 00:26:28,236
Speaker 2: really low cost and high volume in the future. We

523
00:26:28,356 --> 00:26:31,996
Speaker 2: are typically buying more expensive tons earlier on as the

524
00:26:31,996 --> 00:26:34,276
Speaker 2: first buyer, and we are the first ever customer for

525
00:26:34,316 --> 00:26:36,636
Speaker 2: seventy eight percent of companies and we're the first off

526
00:26:36,676 --> 00:26:39,476
Speaker 2: taker for as of you know, as of now eighty

527
00:26:39,516 --> 00:26:41,836
Speaker 2: two percent of them. So like you know, we're we're

528
00:26:41,836 --> 00:26:42,516
Speaker 2: coming in early.

529
00:26:42,916 --> 00:26:43,236
Speaker 1: Yes.

530
00:26:43,596 --> 00:26:47,116
Speaker 2: Another leading indicator that we look at is is basically like,

531
00:26:47,156 --> 00:26:49,756
Speaker 2: are are we picking companies that are actually starting to

532
00:26:49,796 --> 00:26:53,476
Speaker 2: deliver the tons? Like Vaulted, for example, delivered twelve thousand

533
00:26:53,676 --> 00:26:56,916
Speaker 2: tons of carbon removal last year. This is the most

534
00:26:56,916 --> 00:27:00,316
Speaker 2: of any company working on carbon removal, permanent carbon removal,

535
00:27:00,356 --> 00:27:04,596
Speaker 2: by a significant margin. You know, Chrum has injected and

536
00:27:05,276 --> 00:27:08,356
Speaker 2: several thousand tons last year. Lithos applied three hundred thousand

537
00:27:08,396 --> 00:27:11,396
Speaker 2: tons of rock this year, which is positioning them to

538
00:27:11,436 --> 00:27:14,356
Speaker 2: put in some pretty significant numbers in the coming couple

539
00:27:14,356 --> 00:27:16,756
Speaker 2: of years. So these numbers are still small, but they

540
00:27:16,756 --> 00:27:20,196
Speaker 2: are much larger than we've seen in previous years. And

541
00:27:20,236 --> 00:27:22,956
Speaker 2: I think that that is really promising. I think we

542
00:27:22,996 --> 00:27:25,396
Speaker 2: feel those are good early indicators. But you know, it's

543
00:27:25,396 --> 00:27:27,236
Speaker 2: going to take a decade or so, I think to

544
00:27:27,556 --> 00:27:29,196
Speaker 2: know if this really had the effect that we wanted to.

545
00:27:29,716 --> 00:27:31,556
Speaker 1: Let's talk a little bit about kind of the state

546
00:27:31,596 --> 00:27:34,156
Speaker 1: of the industry itself, right, because you are kind of

547
00:27:34,156 --> 00:27:37,836
Speaker 1: at the center of it. You have a nice perspective. Yeah,

548
00:27:37,916 --> 00:27:40,036
Speaker 1: I mean, let's just step through like a few companies

549
00:27:40,276 --> 00:27:42,956
Speaker 1: doing with a few different kinds of technologies, right, I

550
00:27:42,996 --> 00:27:45,636
Speaker 1: feel like the one the most people have heard of

551
00:27:46,276 --> 00:27:50,356
Speaker 1: is direct air capture. Right, is just fans and filters

552
00:27:50,356 --> 00:27:52,996
Speaker 1: and whatever, like, should we start there? What's happening with

553
00:27:53,036 --> 00:27:54,476
Speaker 1: direct air capture? Sure?

554
00:27:54,516 --> 00:27:57,436
Speaker 2: So direct air capture, Yeah, you've probably seen these big

555
00:27:57,476 --> 00:27:59,596
Speaker 2: fans kind of looks like a vacuum cleaner or something.

556
00:27:59,676 --> 00:28:02,996
Speaker 2: You're like, you're pulling an air You're finding the co

557
00:28:03,156 --> 00:28:05,956
Speaker 2: two particles from the other million air particles, You're compressing

558
00:28:05,956 --> 00:28:10,036
Speaker 2: those and then injecting that usually underground somewhere, and there

559
00:28:10,036 --> 00:28:13,156
Speaker 2: are a number of direct air capture companies out there.

560
00:28:13,436 --> 00:28:16,396
Speaker 2: I think direct air capture is a technology that has

561
00:28:17,436 --> 00:28:20,836
Speaker 2: high long term potential, but it's very capital intensive and

562
00:28:20,836 --> 00:28:24,556
Speaker 2: it's very energy intensive, especially early stage. And there's a

563
00:28:24,596 --> 00:28:27,756
Speaker 2: number of in our opinion, really promising approaches that have

564
00:28:27,836 --> 00:28:31,196
Speaker 2: the potential to be super low cost. And that is

565
00:28:31,196 --> 00:28:33,956
Speaker 2: both because of sort of cheap off the shelf capex

566
00:28:34,396 --> 00:28:39,116
Speaker 2: and because of their ability to do that process for

567
00:28:39,196 --> 00:28:41,676
Speaker 2: really low energy. But it's basically a game of capex

568
00:28:41,756 --> 00:28:46,356
Speaker 2: and energy for DAC that's really important. It's technically infinitely scalable, right,

569
00:28:46,676 --> 00:28:50,356
Speaker 2: but cost is the challenge for DAC. It's permanent, it's scalable.

570
00:28:50,476 --> 00:28:52,756
Speaker 2: The question is cost, which is a function of capex

571
00:28:52,796 --> 00:28:53,276
Speaker 2: and energy.

572
00:28:53,956 --> 00:28:56,916
Speaker 1: Okay, what do you want to do next? Should we

573
00:28:56,916 --> 00:28:58,436
Speaker 1: talk about plants next? What do you want to talk

574
00:28:58,436 --> 00:28:58,836
Speaker 1: about next?

575
00:28:58,916 --> 00:29:00,716
Speaker 3: Let's talk about plants. Then we're going to talk about rocks.

576
00:29:01,036 --> 00:29:02,876
Speaker 1: Okay, plants go.

577
00:29:03,236 --> 00:29:07,676
Speaker 2: So plants, of course, as we know, naturally sucks you

578
00:29:07,836 --> 00:29:11,396
Speaker 2: two out of the air. And they do this sort

579
00:29:11,436 --> 00:29:14,956
Speaker 2: of in a quote for free because they're using using

580
00:29:14,956 --> 00:29:16,316
Speaker 2: solim from the.

581
00:29:16,556 --> 00:29:19,356
Speaker 1: Least they use leaks, photos, sus.

582
00:29:19,836 --> 00:29:22,196
Speaker 2: The challenge with plants is when in the context of

583
00:29:22,196 --> 00:29:24,876
Speaker 2: carbon removal is two things. One, they take up a

584
00:29:24,876 --> 00:29:27,796
Speaker 2: lot of space and so at the scale that we're

585
00:29:27,836 --> 00:29:30,356
Speaker 2: talking they're sort of limits. The second thing that is

586
00:29:30,436 --> 00:29:33,316
Speaker 2: challenging about plants is they're not permanent. Trees can burn down.

587
00:29:33,596 --> 00:29:35,916
Speaker 1: Or just die, even right at the time scales we're

588
00:29:35,916 --> 00:29:38,316
Speaker 1: talking about, even if there is not a fire, they

589
00:29:38,356 --> 00:29:39,876
Speaker 1: will die and decompose. Right.

590
00:29:39,996 --> 00:29:42,636
Speaker 2: Plants are very important for many reasons, but in the

591
00:29:42,636 --> 00:29:46,236
Speaker 2: context of carbon removal, that the types of solutions that

592
00:29:46,276 --> 00:29:48,156
Speaker 2: we are looking at because we care about the permanence

593
00:29:48,196 --> 00:29:51,676
Speaker 2: piece A lot is how do you take what nature

594
00:29:51,716 --> 00:29:54,636
Speaker 2: does for free and make that sort of permanent. So

595
00:29:54,796 --> 00:29:57,156
Speaker 2: Charm Industrial is an example of a company that takes

596
00:29:57,196 --> 00:30:00,956
Speaker 2: waste biomass, so sort of leftover corn stover for example,

597
00:30:01,356 --> 00:30:04,636
Speaker 2: that farmers would you know, have from growing corn. They

598
00:30:04,716 --> 00:30:07,236
Speaker 2: take that, they pyalyze it, which basically just means they

599
00:30:07,236 --> 00:30:09,796
Speaker 2: heat it up without oxygen, and they turn it into

600
00:30:09,996 --> 00:30:13,156
Speaker 2: at oil that they can then direct back underground.

601
00:30:13,236 --> 00:30:15,396
Speaker 1: I talked to Sean Kinnetic who used to be there

602
00:30:15,516 --> 00:30:16,836
Speaker 1: on this show a couple of years ago.

603
00:30:16,916 --> 00:30:17,676
Speaker 3: Oh fabulous.

604
00:30:17,796 --> 00:30:20,036
Speaker 1: So why is that one promising and why is that one?

605
00:30:20,516 --> 00:30:21,196
Speaker 1: What are the limits?

606
00:30:21,236 --> 00:30:24,716
Speaker 2: It's promising because you get the capture part for free

607
00:30:24,756 --> 00:30:29,876
Speaker 2: from plants. It's challenging because there is a limited amount

608
00:30:29,916 --> 00:30:33,636
Speaker 2: of quote unquote waste biomass, So like there is a

609
00:30:33,756 --> 00:30:37,036
Speaker 2: sort of tap on probably how big that can be

610
00:30:37,036 --> 00:30:39,916
Speaker 2: because there is only so much waste biomass. And then

611
00:30:39,956 --> 00:30:41,716
Speaker 2: there's a question of like what is the best thing

612
00:30:41,756 --> 00:30:44,236
Speaker 2: to do with that waste in a given scenario based

613
00:30:44,276 --> 00:30:44,836
Speaker 2: on where it is.

614
00:30:45,396 --> 00:30:46,836
Speaker 1: And so just to be clear, like in the case

615
00:30:46,876 --> 00:30:49,036
Speaker 1: of Charm they go out to cornfields where after the

616
00:30:49,036 --> 00:30:51,436
Speaker 1: corn has been harvested. There's all this just like the

617
00:30:51,516 --> 00:30:53,676
Speaker 1: corn plant is just sitting there on the ground, right,

618
00:30:54,036 --> 00:30:56,396
Speaker 1: and that is essentially carbon that has been captured that's

619
00:30:56,396 --> 00:30:58,676
Speaker 1: about to go back into the atmosphere. But if they

620
00:30:58,676 --> 00:31:00,436
Speaker 1: can piraalize it and stick it in the ground for

621
00:31:00,476 --> 00:31:02,876
Speaker 1: ten thousand years, that's great. But it doesn't scale that

622
00:31:02,996 --> 00:31:06,196
Speaker 1: much because there's not that many corn stocks sitting on

623
00:31:06,196 --> 00:31:07,676
Speaker 1: the ground in various forms around the world.

624
00:31:07,756 --> 00:31:10,396
Speaker 2: It gets you to probably actively and you know, there

625
00:31:10,436 --> 00:31:12,516
Speaker 2: are different estimates for this, probably in the order of

626
00:31:12,596 --> 00:31:15,676
Speaker 2: like a gig a ton plus per year by twenty fifty,

627
00:31:15,716 --> 00:31:18,436
Speaker 2: so that's not nothing, okay, but it's probably not going

628
00:31:18,476 --> 00:31:20,796
Speaker 2: to get you to ten gigatons a year. So it's

629
00:31:20,996 --> 00:31:23,116
Speaker 2: by itself, it's not going to get you all the

630
00:31:23,116 --> 00:31:23,556
Speaker 2: way there.

631
00:31:23,756 --> 00:31:25,876
Speaker 1: But it's a non trivial chunk if it works, if

632
00:31:25,916 --> 00:31:28,156
Speaker 1: it comes cost effective, I mean presumably for all these

633
00:31:28,516 --> 00:31:31,476
Speaker 1: cost is still they're still quite expensive, and you have

634
00:31:31,476 --> 00:31:32,756
Speaker 1: to get the cost exactly.

635
00:31:32,836 --> 00:31:35,196
Speaker 2: And in the case of you know, some of there

636
00:31:35,196 --> 00:31:37,796
Speaker 2: are different biker's approaches, but there's case to the capex,

637
00:31:37,836 --> 00:31:41,436
Speaker 2: there's a case there's the cost of sometimes transporting the biomass,

638
00:31:41,476 --> 00:31:44,076
Speaker 2: but it's again it's very sort of case by case specific.

639
00:31:44,236 --> 00:31:46,276
Speaker 2: I would just call out that the waste biomass problem,

640
00:31:46,476 --> 00:31:49,316
Speaker 2: there's a real limit to how big it can be,

641
00:31:49,436 --> 00:31:50,876
Speaker 2: and so that's why we can't put.

642
00:31:50,756 --> 00:31:53,316
Speaker 3: All of our chips in that basket. Yeah, now we

643
00:31:53,356 --> 00:31:54,276
Speaker 3: can talk about rocks.

644
00:31:54,396 --> 00:31:57,916
Speaker 2: Most of the world's carbon actually is in rocks in

645
00:31:57,956 --> 00:32:01,476
Speaker 2: the lithosphere, and it just takes a really long time

646
00:32:01,516 --> 00:32:03,636
Speaker 2: to get there. A reactive rocks, if it's an alkaline rock,

647
00:32:03,676 --> 00:32:06,316
Speaker 2: will absorb carbon roughly proportional to a surface area.

648
00:32:06,316 --> 00:32:07,316
Speaker 3: It also cares about.

649
00:32:07,116 --> 00:32:08,796
Speaker 2: Other things like you know, it doesn't have access to

650
00:32:08,836 --> 00:32:12,156
Speaker 2: water and temperature, et cetera. But you can kind of

651
00:32:12,156 --> 00:32:15,676
Speaker 2: think about reactive rocks. Some rocks are like sponges for carbon.

652
00:32:15,756 --> 00:32:18,196
Speaker 2: So the question is is how do you find or

653
00:32:18,276 --> 00:32:21,156
Speaker 2: make alkaline rock which is very reactive rock that is

654
00:32:21,236 --> 00:32:25,556
Speaker 2: kind of in its most squeezed sponge form, and what

655
00:32:25,596 --> 00:32:28,796
Speaker 2: do you do with that to turn that into carbon

656
00:32:28,876 --> 00:32:32,196
Speaker 2: ruble to sort of get it to do this sponge activity.

657
00:32:32,716 --> 00:32:37,956
Speaker 2: And there are a number of different ways that we

658
00:32:38,076 --> 00:32:41,316
Speaker 2: are looking at. One of them is called enhanced rock weathering,

659
00:32:41,436 --> 00:32:44,276
Speaker 2: and this is taking sort of taking that reactive rock,

660
00:32:44,316 --> 00:32:47,836
Speaker 2: spreading it on fields where it has access to air

661
00:32:47,996 --> 00:32:50,796
Speaker 2: and it has access to sort of rain and water,

662
00:32:51,356 --> 00:32:53,596
Speaker 2: and eventually that makes its way into the ocean and

663
00:32:53,676 --> 00:32:56,636
Speaker 2: is stored as bicarbonate. But that is sort of one

664
00:32:56,836 --> 00:33:01,196
Speaker 2: use of a rock. There's another category called it doesn't

665
00:33:01,196 --> 00:33:03,596
Speaker 2: really have a good name yet. We talk about it

666
00:33:03,596 --> 00:33:07,596
Speaker 2: as like surficial mineralization. But essentially, yeah, taking this rock,

667
00:33:07,716 --> 00:33:11,556
Speaker 2: grinding it up to air and some water, it mineralizes,

668
00:33:11,676 --> 00:33:14,356
Speaker 2: it turns into a carbonate, and then you essentially put

669
00:33:14,356 --> 00:33:16,996
Speaker 2: it in these giant piles that are piles of carbon removal.

670
00:33:17,396 --> 00:33:19,676
Speaker 2: And you know, it sounds it sounds a little wild,

671
00:33:19,756 --> 00:33:22,956
Speaker 2: but it's quite interesting because.

672
00:33:22,636 --> 00:33:24,876
Speaker 1: I like how simple it is. If it works, it

673
00:33:24,956 --> 00:33:26,716
Speaker 1: sounds really simple, which seems good.

674
00:33:26,836 --> 00:33:29,316
Speaker 2: Yes, And you know, we know how to do things

675
00:33:29,356 --> 00:33:32,236
Speaker 2: like grind up rocks. We have an existing big mining industry.

676
00:33:33,156 --> 00:33:35,596
Speaker 2: In this case, the carbon removal actually stays in place,

677
00:33:35,636 --> 00:33:37,916
Speaker 2: so the monitoring and verification is quite easy.

678
00:33:38,156 --> 00:33:39,876
Speaker 1: You just go and look at the big rock and

679
00:33:39,916 --> 00:33:42,596
Speaker 1: you say, yeah, it's still there. Basically yeah.

680
00:33:42,676 --> 00:33:45,356
Speaker 2: You know, we're very excited about rocks in general, and

681
00:33:45,436 --> 00:33:47,956
Speaker 2: I think that this is this is a thing that

682
00:33:48,036 --> 00:33:49,676
Speaker 2: nature already knows how to do and if we can

683
00:33:49,716 --> 00:33:53,676
Speaker 2: find or make enough alkaline rock and that those are

684
00:33:53,796 --> 00:33:57,196
Speaker 2: you know, very scalable and sort of infinitely scalable sponges

685
00:33:57,236 --> 00:33:58,596
Speaker 2: that we can use to suck out a lot of

686
00:33:58,596 --> 00:33:59,996
Speaker 2: cotube from the atmosphere and oceans.

687
00:34:00,596 --> 00:34:03,796
Speaker 1: So it sounds like a direct air captured plants and rocks.

688
00:34:04,156 --> 00:34:06,036
Speaker 1: You seem particularly bullish on rocks.

689
00:34:06,876 --> 00:34:10,356
Speaker 2: I think that rocks are under explos relative to their potential,

690
00:34:10,516 --> 00:34:12,796
Speaker 2: is why I'm quite excited about it. You know, I

691
00:34:12,796 --> 00:34:14,716
Speaker 2: think that, you know, people ask us a lot like, well,

692
00:34:14,716 --> 00:34:18,836
Speaker 2: what's your favorite one? And I am always hesitant to

693
00:34:18,876 --> 00:34:20,196
Speaker 2: answer that question because.

694
00:34:19,956 --> 00:34:22,236
Speaker 1: I wasn't planning to ask you that, But it feels

695
00:34:22,316 --> 00:34:23,516
Speaker 1: like rocks are your favorite.

696
00:34:23,676 --> 00:34:26,556
Speaker 2: I'm excited about rocks currently because I think they are

697
00:34:26,636 --> 00:34:31,636
Speaker 2: under explored, and I think the combination of the scale potential,

698
00:34:31,676 --> 00:34:37,636
Speaker 2: which is functionally unlimited, the permanence and the simplicity of

699
00:34:38,356 --> 00:34:39,596
Speaker 2: rocks could be interesting.

700
00:34:39,676 --> 00:34:43,156
Speaker 1: Obviously, in terms of the whole field of carbon removal,

701
00:34:43,196 --> 00:34:45,396
Speaker 1: it's super early, right, But in terms of the life

702
00:34:45,396 --> 00:34:49,036
Speaker 1: of frontier, it's not that early, And so I'm curious

703
00:34:50,116 --> 00:34:52,316
Speaker 1: what has been different than you expected, Like what has

704
00:34:52,396 --> 00:34:53,756
Speaker 1: gone better, what has gone worse?

705
00:34:53,836 --> 00:34:53,876
Speaker 4: What?

706
00:34:54,356 --> 00:34:55,156
Speaker 1: What have you learned?

707
00:34:56,396 --> 00:35:00,316
Speaker 2: You know, I've been surprised by how at the time

708
00:35:00,356 --> 00:35:02,996
Speaker 2: when we launch Frontier, I wasn't sure for the reason

709
00:35:03,036 --> 00:35:06,196
Speaker 2: that we discussed that a billion dollars was going to

710
00:35:06,476 --> 00:35:10,156
Speaker 2: send an appropriately loud signal. I don't think that it can.

711
00:35:10,236 --> 00:35:13,156
Speaker 2: It didn't convince everyone, and that's fine, but I think

712
00:35:13,196 --> 00:35:19,196
Speaker 2: it convinced enough startups and entrepreneurs and investors that this

713
00:35:19,396 --> 00:35:24,116
Speaker 2: was a big enough market for them to try. And

714
00:35:24,196 --> 00:35:26,756
Speaker 2: so you know, the numbers that we talked about earlier

715
00:35:26,876 --> 00:35:29,676
Speaker 2: that surprised me. I think in that sense, it worked

716
00:35:29,716 --> 00:35:33,796
Speaker 2: better than expected. I think that a thing that is

717
00:35:33,836 --> 00:35:35,996
Speaker 2: also I don't know if we should be surprised by this,

718
00:35:36,116 --> 00:35:40,476
Speaker 2: but you know, carbon removal is still really early and

719
00:35:40,836 --> 00:35:44,956
Speaker 2: when companies start and not all approaches work, and that's

720
00:35:44,956 --> 00:35:47,916
Speaker 2: not because they weren't good ideas. It's because you got

721
00:35:47,916 --> 00:35:49,996
Speaker 2: to test your idea in the real world, and sometimes

722
00:35:49,996 --> 00:35:52,956
Speaker 2: they those don't pan out as you expect. I've been

723
00:35:53,076 --> 00:35:56,676
Speaker 2: also a little bit surprised by like how quick people

724
00:35:56,716 --> 00:36:00,036
Speaker 2: can be to sort of catastrophize what I think in

725
00:36:00,116 --> 00:36:03,036
Speaker 2: any other in any other field would just like look

726
00:36:03,156 --> 00:36:05,956
Speaker 2: like early innovation like there's a bajillion AI startups. Not

727
00:36:05,956 --> 00:36:07,196
Speaker 2: all of them are going to make it, but like

728
00:36:07,276 --> 00:36:09,476
Speaker 2: some of them will, and that's that is there's some

729
00:36:09,676 --> 00:36:12,556
Speaker 2: normal dynamics for an early ecosystem.

730
00:36:12,716 --> 00:36:16,636
Speaker 1: I feel like with carbon removal, there's haters on both sides, right,

731
00:36:16,676 --> 00:36:20,516
Speaker 1: because like, people who don't care about climate change of

732
00:36:20,556 --> 00:36:23,396
Speaker 1: course hate it. But the surprising one is that some

733
00:36:23,436 --> 00:36:26,036
Speaker 1: of the people who do care about climate change hate it. Right,

734
00:36:26,076 --> 00:36:28,676
Speaker 1: there's the it's just going to distract us from the

735
00:36:28,756 --> 00:36:33,436
Speaker 1: energy transition argument, right, So I do feel like you're

736
00:36:33,556 --> 00:36:34,676
Speaker 1: up against a lot of haters.

737
00:36:34,996 --> 00:36:35,996
Speaker 3: Yes, I think that's right.

738
00:36:36,036 --> 00:36:38,396
Speaker 2: And on that point, I think that, you know, the

739
00:36:38,436 --> 00:36:42,116
Speaker 2: moral hazard piece is an argument that people have been

740
00:36:42,116 --> 00:36:43,996
Speaker 2: talking about in the conducts of CARMEEU for a long time.

741
00:36:44,236 --> 00:36:46,756
Speaker 1: And just to be clear, moral hazard our second fund

742
00:36:46,756 --> 00:36:49,796
Speaker 1: econ term of the conversation, after public goods, is basically

743
00:36:49,876 --> 00:36:52,916
Speaker 1: the idea that like, oh, carbon removal will just let

744
00:36:52,916 --> 00:36:55,516
Speaker 1: people keep emitting. It'll it's a signal that oh, I

745
00:36:55,516 --> 00:36:57,836
Speaker 1: don't have to worry about it because they'll just suck

746
00:36:57,876 --> 00:36:58,636
Speaker 1: all the carbon out of this.

747
00:36:58,796 --> 00:37:01,276
Speaker 2: Yes, and you know, I think that, you know, our

748
00:37:01,316 --> 00:37:04,716
Speaker 2: perspective is like if we had done. As a world

749
00:37:04,836 --> 00:37:08,956
Speaker 2: a better job with emissions reduction earlier, we wouldn't have

750
00:37:09,036 --> 00:37:10,116
Speaker 2: to do the carbon removal.

751
00:37:10,276 --> 00:37:12,396
Speaker 1: It's a great world where we don't have to do. Really,

752
00:37:12,556 --> 00:37:14,236
Speaker 1: it's a dumb thing to have to spend money on.

753
00:37:14,316 --> 00:37:16,156
Speaker 1: If we'd have been smarter, we wouldn't have to spend

754
00:37:16,196 --> 00:37:16,676
Speaker 1: money totally.

755
00:37:16,716 --> 00:37:19,796
Speaker 2: And like ninety percent plus of the world's efforts should

756
00:37:20,156 --> 00:37:22,636
Speaker 2: stay focused on a miss introduction, because without that there

757
00:37:22,716 --> 00:37:25,556
Speaker 2: is no path to solving climate change full stop. But

758
00:37:25,876 --> 00:37:28,996
Speaker 2: the math also, unfortunately for all of us, doesn't work

759
00:37:29,036 --> 00:37:31,156
Speaker 2: without carbon removals, so like we have to learn to

760
00:37:31,196 --> 00:37:32,676
Speaker 2: walk and chew them at the same time.

761
00:37:32,876 --> 00:37:35,756
Speaker 1: So fun you were surprised by the haters. I'm sorry,

762
00:37:35,836 --> 00:37:37,076
Speaker 1: what else I.

763
00:37:36,996 --> 00:37:42,196
Speaker 2: Think that I am generally an impatient person, and I

764
00:37:42,356 --> 00:37:44,996
Speaker 2: have to you know, my team's already reminding me that

765
00:37:45,396 --> 00:37:48,196
Speaker 2: to build real things in the real world takes time.

766
00:37:48,396 --> 00:37:51,356
Speaker 1: Yea, this is physical hard tech, right, It's not software.

767
00:37:51,796 --> 00:37:54,076
Speaker 1: You can't just iterate every day and ship every day.

768
00:37:54,116 --> 00:37:57,676
Speaker 1: It's like physical things. It's rocks, right, It's rocks in

769
00:37:57,756 --> 00:37:59,756
Speaker 1: the world that take time to do the thing that

770
00:37:59,796 --> 00:38:00,636
Speaker 1: they do exactly.

771
00:38:00,676 --> 00:38:02,956
Speaker 2: And so we are sort of we as a team

772
00:38:03,156 --> 00:38:07,076
Speaker 2: talk a lot about sort of inhabiting different mindsets. It's

773
00:38:07,116 --> 00:38:09,996
Speaker 2: like we are rushed and we're we're sort of where

774
00:38:10,116 --> 00:38:13,236
Speaker 2: we are running to get, you know, our fund contracted

775
00:38:13,316 --> 00:38:16,876
Speaker 2: as robustly as possible, and at the same time, we're

776
00:38:16,876 --> 00:38:19,716
Speaker 2: playing the long game like this is going to take decades.

777
00:38:19,796 --> 00:38:22,476
Speaker 2: This this industry is going to take decades to really

778
00:38:22,916 --> 00:38:28,036
Speaker 2: materialize and form. And we are still you know, we're

779
00:38:28,156 --> 00:38:30,636
Speaker 2: We're closer to the starting line than any other place.

780
00:38:30,676 --> 00:38:34,036
Speaker 2: We're five six years into this. So I think that

781
00:38:34,156 --> 00:38:37,316
Speaker 2: trying to sort of both have that short term urgency

782
00:38:37,356 --> 00:38:40,556
Speaker 2: but also really realize that, like you know, climate and

783
00:38:40,596 --> 00:38:42,996
Speaker 2: carbon removal is more than one administration, It is more

784
00:38:43,036 --> 00:38:45,876
Speaker 2: than one country. The timeframes that we're talking about just

785
00:38:45,956 --> 00:38:50,116
Speaker 2: requires a sort of steadfastness that I should have appreciated

786
00:38:50,156 --> 00:38:51,996
Speaker 2: at the beginning, but that I don't think I really

787
00:38:52,036 --> 00:38:54,676
Speaker 2: internalized until probably like the last.

788
00:38:54,476 --> 00:38:54,996
Speaker 3: Year or two.

789
00:38:58,796 --> 00:39:09,676
Speaker 4: We'll be back in a minute with the lightning round.

790
00:39:10,436 --> 00:39:13,436
Speaker 1: Let's finish with the lightning round. Great, he is romanticism

791
00:39:13,476 --> 00:39:15,076
Speaker 1: making a comeback in San Francisco.

792
00:39:17,396 --> 00:39:18,636
Speaker 3: You know, I'm sort of.

793
00:39:20,196 --> 00:39:21,996
Speaker 2: I wrote that piece in part because I think the

794
00:39:22,036 --> 00:39:24,676
Speaker 2: answer is yes, and part because I'm trying to manifest it.

795
00:39:25,156 --> 00:39:25,796
Speaker 1: I love that.

796
00:39:26,076 --> 00:39:27,396
Speaker 3: I do see tells.

797
00:39:27,436 --> 00:39:29,316
Speaker 2: I've lived in San Francisco for a long time, and

798
00:39:29,396 --> 00:39:34,316
Speaker 2: I think that there are tells that San Francisco is

799
00:39:34,396 --> 00:39:40,836
Speaker 2: rediscovering it's humanism, we are rediscovering enjoyment, we are rediscovering

800
00:39:41,356 --> 00:39:43,676
Speaker 2: our sort of soul in a way that I think,

801
00:39:45,196 --> 00:39:48,116
Speaker 2: to me feels very exciting and a little bit different

802
00:39:48,156 --> 00:39:51,196
Speaker 2: and sort of zaggy from the past ten years in SF.

803
00:39:51,676 --> 00:39:52,316
Speaker 3: So I hope.

804
00:39:52,356 --> 00:39:52,436
Speaker 2: So.

805
00:39:53,276 --> 00:39:55,036
Speaker 1: I mean, you talk about it as this sort of

806
00:39:55,796 --> 00:39:58,196
Speaker 1: you know, reaction to the Enlightenment as it was the

807
00:39:58,236 --> 00:40:03,476
Speaker 1: first time, right, which is fun. Who's the byron? Is

808
00:40:03,476 --> 00:40:05,076
Speaker 1: there like a Byron of San Francisco.

809
00:40:05,636 --> 00:40:08,916
Speaker 2: That's a really good question. I don't know, but I

810
00:40:08,916 --> 00:40:11,236
Speaker 2: will think about that. I mean, I also like the

811
00:40:11,276 --> 00:40:13,116
Speaker 2: piece of it is the byron. I don't know you

812
00:40:13,276 --> 00:40:16,316
Speaker 2: live there, and like I'm not, I'm not in the mix.

813
00:40:16,316 --> 00:40:18,316
Speaker 2: I would love you to tell me somebody I should

814
00:40:18,316 --> 00:40:20,716
Speaker 2: listen to or read or watch or whatever.

815
00:40:21,276 --> 00:40:22,036
Speaker 3: I will think about that.

816
00:40:22,676 --> 00:40:24,156
Speaker 1: I do think. I mean, there's another piece of it

817
00:40:24,196 --> 00:40:28,116
Speaker 1: that you write about, right, which is particularly interesting right now,

818
00:40:28,316 --> 00:40:32,036
Speaker 1: which is a reaction to AI reductively right and more

819
00:40:32,076 --> 00:40:37,356
Speaker 1: specifically like this idea that if AI commodifies intelligence, what

820
00:40:37,396 --> 00:40:39,996
Speaker 1: does that mean? Right, Like that's a super There's like

821
00:40:40,116 --> 00:40:43,156
Speaker 1: all the sad Ai things, which fair enough, but there's

822
00:40:43,196 --> 00:40:49,516
Speaker 1: a kind of interesting, maybe happy version of like, you know, embodied.

823
00:40:49,516 --> 00:40:53,236
Speaker 1: I was talking to a guy at Anthropic the other week.

824
00:40:53,516 --> 00:40:55,316
Speaker 1: I said, if you weren't working there, what would you

825
00:40:55,356 --> 00:40:57,756
Speaker 1: be doing? And he said, I'd be a massage therapist.

826
00:40:57,956 --> 00:40:59,956
Speaker 1: And he's say it and he's like, I'm really into

827
00:40:59,996 --> 00:41:05,516
Speaker 1: embodied stuff, which is super romantic in the capital.

828
00:41:05,276 --> 00:41:07,236
Speaker 3: R sense, right, Yeah, I think that.

829
00:41:07,316 --> 00:41:10,596
Speaker 2: Yeah, there's there's sort of like this re emergent interest

830
00:41:10,796 --> 00:41:15,276
Speaker 2: in the physical world and in tactile things and beautiful

831
00:41:15,276 --> 00:41:18,716
Speaker 2: things and a beautiful built environment. I think that, And

832
00:41:18,716 --> 00:41:22,356
Speaker 2: it's just sort of aesthetic aesthetics generally, I think are

833
00:41:22,356 --> 00:41:25,116
Speaker 2: on the rise, and those all they're not all, you know,

834
00:41:25,196 --> 00:41:29,836
Speaker 2: definitionally I guess physical or or sort of analog non digital,

835
00:41:29,956 --> 00:41:31,996
Speaker 2: but I think a lot of them. I think a

836
00:41:32,036 --> 00:41:34,596
Speaker 2: lot of them, A lot of them are that.

837
00:41:34,596 --> 00:41:35,396
Speaker 3: That feels true to me.

838
00:41:36,116 --> 00:41:38,236
Speaker 1: What was the hardest thing about building a coffee table?

839
00:41:41,596 --> 00:41:43,116
Speaker 3: Well, you know, I didn't know how to how to

840
00:41:43,196 --> 00:41:43,676
Speaker 3: use a drill.

841
00:41:44,396 --> 00:41:48,036
Speaker 1: I awesome drills they are amazing.

842
00:41:48,756 --> 00:41:49,836
Speaker 3: I use a drill.

843
00:41:49,836 --> 00:41:52,836
Speaker 2: I didn't know how to use a sander, and I

844
00:41:52,836 --> 00:41:56,436
Speaker 2: I'd really never built anything before. I tweeted. I tweeted,

845
00:41:56,516 --> 00:41:59,676
Speaker 2: did anybody have these things? And a neighbor had had

846
00:41:59,716 --> 00:42:01,876
Speaker 2: all the tools, taught me to use them, and essentially,

847
00:42:01,916 --> 00:42:03,596
Speaker 2: you know, this coffee, this coffee I'm looking at it

848
00:42:03,676 --> 00:42:08,436
Speaker 2: right now, this coffee table is I love how it looks,

849
00:42:08,436 --> 00:42:10,356
Speaker 2: and I had a very specific thing that I wanted

850
00:42:10,356 --> 00:42:12,636
Speaker 2: it to look like. But I am pretty sure that

851
00:42:12,756 --> 00:42:14,996
Speaker 2: it is going to decompose by ever trying to move

852
00:42:15,036 --> 00:42:17,956
Speaker 2: it. It is not built very well, but it does serve

853
00:42:17,996 --> 00:42:20,756
Speaker 2: its purpose, at least at this at this moment.

854
00:42:20,956 --> 00:42:23,276
Speaker 1: I mean, maybe it's purpose was building it.

855
00:42:23,436 --> 00:42:23,636
Speaker 4: Right.

856
00:42:24,076 --> 00:42:31,436
Speaker 3: Oh, I love that. Yeah, No, you're probably right.

857
00:42:32,476 --> 00:42:36,036
Speaker 1: Man Ransoff is head of Climate at Stripe and Frontier.

858
00:42:36,756 --> 00:42:40,076
Speaker 1: Please email us at problem at Pushkin dot fm. We

859
00:42:40,156 --> 00:42:43,836
Speaker 1: are always looking for new guests for the show. Today's

860
00:42:43,876 --> 00:42:47,236
Speaker 1: show was produced by Trina Menino and Gabriel Hunter Chang.

861
00:42:47,636 --> 00:42:51,676
Speaker 1: It was edited by Alexander Garreton and engineered by Sarah Bruguier.

862
00:42:52,076 --> 00:42:54,196
Speaker 1: I'm Jacob Goldstein, and we'll be back next week with

863
00:42:54,276 --> 00:43:02,076
Speaker 1: another episode of What's your problem,