Companies such as Microsoft, Shopify, H&M, and payments company Stripe are investing millions in carbon removal, the process of extracting carbon dioxide from the atmosphere to limit the impact of climate change. It’s an effort that continues to attract investment from companies eager to show they are addressing climate issues while simultaneously lowering the cost of such efforts through rapidly evolving technologies.
Key Takeaways
- Companies including Microsoft, H&M, Shopify, and Stripe have spent millions on carbon capture technologies and partnered with sustainability-focused startups.
- Carbon capture, or carbon removal, is the process of removing carbon dioxide from the atmosphere and trapping it in some form.
- It can be achieved through natural means, such as reforestation and soil management, or through man-made techniques like carbon air capture.
- Carbon capture is among many strategies that could reduce the impact of climate change, and keep temperature rise limited to 1.5 degrees Celsius as outlined in the Paris Climate Agreement.
Carbon capture is among many strategies that could reduce the impact of climate change, and keep temperate rise limited to 1.5 degrees Celsius, as outlined in the 2015 Paris Climate Accord.
Corporate support for carbon capture technologies has been growing. Frontier, a nine-year carbon capture initiative founded in 2021 by Alphabet (GOOGL), Meta (META), McKinsey, Shopify (SHOP) and Stripe, has raised more than $1 billion in funding to help lower the cost per-metric-ton of carbon capture.
“With Frontier, we want to send a loud demand signal to entrepreneurs, researchers, and investors that there is a market for permanent carbon removal: build and we will buy,” said Nan Ransohoff, head of climate at Stripe.
Members Stripe, Shopify, and H&M on Thursday committed to another $7 million in carbon removal technologies from 12 sustainability-focused startups: Airhive, Alkali Earth, Banyu Carbon, Carbon Atlantis, CarbonBlue, CarbonRun, EDAC Labs, Holocene, Mati, Planetary Technologies, Spiritus Technologies, and Vaulted Deep. Based on their own estimates, these companies could collectively remove up to half a million tons of carbon dioxide annually by 2026.
Microsoft and Heirloom
Those aren’t the only companies investing heavily in carbon capture. Microsoft (MSFT) has partnered with Heirloom, an industrial design startup, purchasing up to 315,000 metric tons of the former’s direct air capture technology—a carbon removal process that extracts carbon dioxide directly from the atmosphere.
The decision comes a month after Heirloom was chosen as one of two firms awarded by the Energy Department for $1.2 billion in funding for the construction of air capture facilities. Heirloom is slated to receive half this amount for a direct air capture hub in Louisiana.
How It Works
Carbon capture, or carbon removal, is the process of removing carbon dioxide from the atmosphere and trapping it in some form, whether in trees, rocks, soil, water, or man-made structures such as buildings and concrete. Once entrapped, carbon dioxide can be locked away for centuries if not millennia. Strategies for implementing carbon removal are often called negative emissions technologies (NETs).
The direct air capture costs are more than 50 times the cost per metric ton of most natural climate solutions, according to Microsoft. To cover costs, direct air capture companies sell the byproduct, CO2, to other companies, such as oil companies that put that byproduct to use pumping more oil out of older wells.
Carbon capture can occur through natural means, such as reforestation and agricultural soil management, or via man-made techniques like carbon air capture, which directly extracts carbon dioxide from the atmosphere. Hybrid strategies also exist, including using bioenergy with carbon capture and storage, and ocean-based carbon removal.
Government Support
Government involvement will be necessary to achieve the goals outlined in the Paris Climate Accord. Some 40 countries have carbon pricing mechanisms, with more planning to implement them in the future.
In 2021, the White House pledged up to $11 billion a year dedicated to climate support for developing nations. And in April, President Biden announced the U.S. is providing an additional $1 billion to the U.N.-backed Green Climate Fund (GCF), bringing the U.S. commitment to $2 billion. The GCF funds projects to accelerate clean energy transitions and encourage private investment.
This content was originally published here.
