Getting to Gigatons with Direct Air Capture

Brinc empowers game-changing entrepreneurs focused on creating a more sustainable, equitable, and inclusive future. In preparation for the launch of a climate tech program that will run beginning early next year, we recognize carbon dioxide removal (CDR) as an area that can support this vision. However, further innovation and international adoption are necessary to achieve net zero targets.

Direct air capture (DAC), a technology that removes carbon dioxide from the air, is one approach among a portfolio of CDR solutions we are exploring.¹ DAC is promising as its limited resource requirements means plants can be sited almost anywhere. Furthermore, in terms of carbon credit quality, DAC can provide permanence alongside a relatively simple monitoring, reporting, and verification (MRV) process.

However, achieving annual gigaton-scale removal, even by 2050, is a daunting task. Due to the low concentration of carbon dioxide in the atmosphere, renewable energy input requirements are massive.² Furthermore, there are currently only 18 sites capturing around 10,000 tons per year.³ To reach net zero targets, assuming an S-curve-like growth trajectory, eight large-scale (1 MtCO2/year) plants need to be built per year during the current decade, increasing to 50 each year or thereabouts for the subsequent two decades. The most promising announcements aligned to this level of scale-up and investment are the recent US commitments of US$3.5 billion to build four DAC hubs, with the first proposed operational by 2025, and enhancements of the 45Q tax credit for DAC to US$180 per ton (among other provisions in the Inflation Reduction Act).

You may wonder whether carbon removal is an overhyped climate tech solution. Aren’t these investments a distraction from the core mission of reducing greenhouse gas emissions and potentially a pathway for complacency? Multiple sources, including the recent IPCC report, highlight that removal on the order of five to 10 gigatons per year by 2050 will be required to account for hard-to-abate sectors in addition to emissions reduction. Furthermore, in order to step back from the current state of the climate crisis and reach pre-industrial carbon dioxide levels, technologies such as DAC are necessary to pull down legacy carbon. If the scale of removal today doesn’t cement the reality that emissions reductions are still critical, hopefully policies which separate removal and reduction targets can minimize any potential moral hazard.

Taking a technology such as DAC from where it is today to a scale comparable to the auto industry will definitely be challenging, but it does present an opportunity to embed the principles of a just transition from the outset. Moreover, assuming a social cost of carbon at US$50 to 100 per ton, it’s also an enormous market opportunity.⁴ Building the required plants estimated above will require global collaboration. My research around the current projects and proposals for sites in new geographies (beyond the US, Europe, and Canada) highlights some of the broader questions and challenges the carbon removal industry will need to address.

“DAC is not just for the heartless tech billionaire, but there are co-benefits for economically balancing load on an underdeveloped renewables grid and using the technology to attract energy-intensive, high-value industries and skilled jobs.” James Mwangi, Dalberg Group

Critical Factors Influencing DAC Plant Locations

While DAC plants can in theory be located anywhere, there are a few critical constraints:

• Geological storage capacity for permanent removal — Global storage capacity should not be a limiter or the major cost driver (likely US$10 to US$35 per ton removed), but the timeline for permitting and validation of new storage sites could be an issue, as it can take up to 10 years if extensive data collection (such as geological surveys) is required. Transit infrastructure pipelines could be another expensive consideration, which begs the question of how much DAC development can occur in a vacuum from other planned point source carbon capture (carbon capture, CCUS, or CCS) projects.⁵

• Clean energy access and cost — Cheap clean energy inputs are necessary to ensure carbon negative operation and as a result of DAC’s high operational expense. To avoid moral hazard and minimize cost, these should be excess resources to avoid diverting renewables from emissions reduction opportunities. Discussions on DAC siting will likely also be closely tied to ensuring energy security.

• Appropriate legal and regulatory frameworks — Establishing appropriate policies is likely the first step, as, for example, governments would initiate geological surveys and establish renewables adoption targets. Relevant frameworks may exist around CCS projects or oil and gas and be modified to cover DAC, though provisions specifically for pilots could be another approach. Jason Hochman of DAC Coalition highlighted the importance of local stakeholders to ensure that projects benefit surrounding communities. Furthermore, Hochman argued that governments should promote public procurement at scale, recognizing carbon dioxide as a waste which must be managed.

While the cost of materials and labor would certainly differ widely based on siting, these represent second-order effects relative to the issues above (though some models have been developed). Hubs, as opposed to individual plants, offer potential for increased bankability, lower operational costs from shared infrastructure, and faster technology development and deployment from standardization. Meanwhile, location dependencies, such as the impact of humidity or arid conditions on operations, must be considered, while full lifecycle assessments are necessary to confirm that siting is environmentally responsible.

“Communities aren’t monoliths. There may be competing interests between job creation, NIMBY[not in my backyard]ism, and general disposition to carbon management.” Jason Hochman, DAC Coalition

Africa’s Great Carbon Valley

If DAC hubs only bring benefits such as job creation, then perhaps the Global South would be ideal for deployment. Furthering an environmental justice argument, the cost of these plants would need to be covered by the Global North, which has contributed the most to climate change.

Two local stakeholders and DAC supporters in Africa are James Mwangi (Co-Founder and Executive Director, Dalberg Group and Founder, Climate Action Platform for Africa (CAP-A)) and his colleague Fridah Kiboori (Senior Manager, Dalberg Advisors). Rather than waiting for idealists of the future, they hope to attract the capitalists of today by providing inexpensive waste heat and power from existing renewable sources, including geothermal assets, and leveraging the world’s youngest and fastest-growing workforce. Mwangi is primarily focused on generating interest from the voluntary markets based on “what they care about — getting the maximum amount of removal per unit of capital deployed.” Mwangi elaborated that “DAC is not just for the heartless tech billionaire, but there are co-benefits for economically balancing load on an underdeveloped renewables grid and using the technology to attract energy-intensive, high-value industries and skilled jobs.”

In terms of the three requirements, geothermal resources suggest siting in Kenya even as the relevant regulatory frameworks are still being established. Mwangi is working on assembling a subset of the key external parties: mineralization and DAC startups along with voluntary market support. The plan would be to remove 100 tons by next year and launch a scheme of 50 to 100 times that size by the following year, in line with expected scale-up of projects under development in other regions. There are several parties Mwangi is in conversation with around DAC and mineralization, but his biggest question relates to the voluntary markets: “If we build it, will they come?”.

In the long term, Mwangi envisions attracting additional startups to East Africa and helping companies deploy across the continent. In this capacity, he is currently an advisor for the DAC Coalition. In parallel, he is involved with strengthening and connecting local tech talent.

“International collaboration is necessary to accelerate commercial deployment.” Hiroshi Nambo, Global CCS Institute

Japan’s Vision for ASEAN Collaboration

Hiroshi Nambo, Japan’s branch representative at the Global CCS Institute, was more bearish on DAC given the current high costs. He noted that Japan’s 2050 roadmap currently prioritizes carbon capture, with a plan by the Ministry of Economy, Trade, and Industry (METI) to have 120 million to 240 million tons of carbon dioxide mitigated by CCS (roughly 15% to 20% of Japan’s emissions). Japan has also been instrumental in establishing the Asia CCUS Network, one of the few related coalitions in the region. Nonetheless, METI does include DAC in its recent roadmap for carbon recycling technologies. Japan has also invested some efforts around DAC through its moonshots R&D program. Meanwhile, large conglomerates such as Mitsubishi are pioneering carbon utilization efforts.

Japan has limited storage capacity onshore, so meeting these decarbonization targets means “international collaboration is necessary to accelerate commercial deployment.” Nambo discussed plans to capture within the country and ship to other suitable regional storage sites, such as in Australia or Indonesia. Such cross-border arrangements create regulatory challenges, largely falling under the London Protocol (in which Indonesia is not yet included). Furthermore, this plan requires appropriate emissions trading schemes (ETS) as incentives for Japan to claim these credits.

Additionally, Kristinn Ingi Lárusson, Head of Business Development and Commercial at the mineralization startup Carbfix, shared details on their activities. Currently, they have projects both in DAC and carbon capture storage in Iceland. Moving forward, Carbfix intends to simultaneously 1) use Iceland as a DAC hub for startups early in development, 2) increase global deployment efforts, and 3) expand into storage hubs.⁶

While Lárusson was not at liberty to share specific locations due to confidentiality, he did point to the mineral storage map on their website and noted that projects are already being planned in Asia (along with Europe and North America). Indonesia’s potential as a DAC hub given its geothermal resources has already been identified in recent IEA reports. The success of these efforts seems heavily linked to Japan’s push for regional collaboration, the establishment of key frameworks for carbon transit and ETS, and increased renewables adoption.

From Carbfix’s experience across global markets, Lárusson highlights differences he has seen so far in international policy efforts, from the EU relying on ETS and mandatory markets to North America’s focus on tax incentives and voluntary markets. He sees Asia as a dynamic region where Japan is proposing ideas and noted that China already has an ETS market.

“We are in the lucky position of being able to choose projects, and want to work with partners aligned to our mission and values.” Kristinn Ingi Lárusson, Carbfix

Opportunities in the Middle East?

44.01, another mineralization startup, is headquartered in Oman, which raises questions about how well-positioned the region is for broader deployment. The prevalence of oil and gas activity highlights a more open-ended question about the role of these companies in DAC deployment. In terms of Carbfix’s plans for the Middle East, Lárusson mentioned: “We are in the lucky position of being able to choose projects, and want to work with partners aligned to our mission and values.” Time will tell how tensions are resolved between the need for assets and expertise from these companies and concerns around motives and avoiding moral hazard.

What’s next?

Given how far into the future DAC at scale is, how might other seemingly parallel technological developments impact adoption pathways and timelines? Certainly DAC startups that develop breakthroughs decreasing energy intensity are needed. How much can the industry benefit from the success of startups such as Fervo enabling widespread, lower-cost geothermal energy? Excess wind and solar resources seem to have been prioritized for DAC deployment given their low levelized cost of energy (LCOE), but is matching demand for energy storage to counter intermittency being taken into account?

Broadly, whether the projects highlighted above will advance from one-off plants to hubs and the scale necessary for impact still begs the question “who pays?” Can corporates and the voluntary market continue to drive development, even with minimal local policy support? What about the global expertise and possibly ideal siting options of depleted reservoirs through support from oil and gas companies? The line between corporates, international financial institutions, and policymakers is often blurred depending on the timeline and scale of efforts.

Nonetheless, it is clear that further policy developments are necessary, in particular for legal frameworks around storage, guidelines around site closure, and long-term ownership and liability. Looking at cross-border deployment, international standards are needed around safe operation, MRV, and robust accounting frameworks. Multiple models for incentives to build the market by policy levers have been proposed and implemented, but these must be prefaced by increased inclusion of DAC in international mitigation targets and clearer guidelines on border adjustment policies such as carbon tariffs.

Finally, the role of local communities and any regional or cultural context cannot be ignored, and there are still unanswered technical questions around DAC air quality. The next step is education within local communities, including resources and frameworks to ensure environmental justice is appropriately considered in planning, and enabling community empowerment. As Hochman outlined, “It’s critical to recognize that communities aren’t monoliths. There may be competing interests between job creation, NIMBY[not in my backyard]ism, and general disposition to carbon management.”

There is still a lot to unpack around this topic, from deeper understanding of regional developments and the role of voluntary markets, to the potential for financial institutions and instruments to drive change. Given Brinc’s vision to protect our planet and inspire innovators to maximize their impact, we would love to hear from founders working in this space. Brinc also hopes to increase global dialogue around DAC, and we are actively engaging with like-minded investors and partners. Please visit our site or email us to find out more about what we have planned and how to get involved.

Notes

1. For a more detailed introduction into DAC and other CDR approaches, see here and here.
2. Theoretical estimates give energy demand on the order of hundreds of gigawatts to terawatts. Detailed techno-economic estimates suggest energy requirements of 1500 kWh/ton carbon dioxide removed is achievable in the future based on experience curves, though some seed startups today claim <500 kWh/ton will be possible with their breakthrough approaches.
3. Tracker of CDR progress towards the 10 Gt goal (includes other approaches in addition to DAC)
4. If all of this sounds too expensive, for context in 2018 US$1.85 trillion was invested into energy by the private sector.
5. This article distinguishes between point source carbon capture (reducing emissions at the source, which is technically more feasible than DAC given higher carbon dioxide concentrations, but more problematic from a moral hazard perspective), predominantly referred to as “carbon capture,” and carbon removal (net carbon negative processes such as DAC), following the Oxford principles.
6. Storage hubs, similar to DAC hubs, would be sites where multiple projects could share infrastructure (in this case, access to storage which has already approved by relevant regulatory bodies and validated) to lower costs, increase bankability, and otherwise decrease barriers to entry.