Carbon tech (2024)

Some startups want to prove we can take as many emissions out of the atmosphere as we’ve been putting in. They’re using futuristic machines to yank carbon from the air or smokestacks and then bury it underground. Others are repurposing carbon for commercial use. For example, French-American startup Dioxycle raised $17m in 2023 for what it calls a “world-first” attempt to extract ethylene, used widely in the production of textiles and plastics, from CO2. It’s not all land-based: the UK’s Seabound is helping to clean one of our biggest polluters, ships, by trapping their emissions and converting them into calcium carbonate — also called limestone.

So far, the carbon tech sector — a wide group of capturers, removers, storers and recyclers — is bigger on promise than success. The various methods being attempted are all unique, which makes them expensive (many projects have been shelved due to cost). The downturn doesn’t help. European carbon tech startups had a relatively quiet 2023, raising just $376m, a sharp decline from the $1.4bn disbursed to the sector in 2022 (the main culprit: fewer $100m+ “megarounds”). The late-stage scene was drier in 2023 too but things could pick up this year, as the companies that raised mega bucks in 2022 look for a capital refill.

Time is running out for carbon technologies to catch up to the challenge of limiting dangerous global warming. One of the most ambitious undertakings is “direct air capture”, which aims to hoover carbon out of the sky. It’s extremely expensive: Zurich-based Climeworks, the world’s biggest DAC effort, has raised some $800m from VCs. Around two dozen DAC plants have been commissioned globally but their efforts are small-scale, capturing just 0.01 metric tonnes of CO2 a year. The world needs to be capturing about 100x this amount — aka 1 gigaton of C02 a year — by 2030, the International Energy Agency estimates.

Another less-intensive idea is to grow more forests, which act like carbon sinks. Afforestation is when you plant trees on non-forested land while reforestation involves replanting trees in a recently deforested area. As simple as these ideas sound, environmentalists warn that expanding forests should not come at the expense of grasslands or farmlands used for the supply of food, or materials such as timber. Some young startups are helping to guide these efforts. Paris-based Morfo has raised more than $4m for its use of drones to capture imagery of forests across Latin America and Africa. Startups are also looking at the feasibility of enlisting the natural world for other types of carbon removal: Icelandic startup Carbfix, for example, is turning CO2 into stone and burying it underground.