In talks with 'one of the largest fizzy-drinks companies', Swiss company likely to be first profitable carbon remover...
Climeworks AG is not the first company to figure out how to suck carbon dioxide out of the air. It may become the first to make money from it at an industrial scale.
The Swiss company plans to remove 1,000 metric tons a year of the greenhouse gas from the atmosphere when its first commercial plant starts working this summer near its headquarters in Zurich. That’s about the same as the carbon footprint of 200 British residents.
“Our units are actually pretty low tech,” Christoph Gebald, co-founder at Climeworks, said in an interview. “They are steel boxes with two openings and a fan that pulls air through a filter. The CO2 stays on the surface of the filter material.”
The dream of sequestering the most widespread climate-damaging gas from the air cheaply and at a commercial scale has eluded the energy industry for decades. Technology like it, known as carbon capture and storage, is at the heart of the International Energy Agency’s scenarios for how the world can defeat global warming.
Other ideas including greenhouse gas-absorbing rocks, planting forests and storing charcoal in soil haven’t taken off because they would be expensive to implement or because the technology is difficult make at a scale that would matter.
“It’s prohibitively costly to remove CO2 from the atmosphere and there are no financial incentives in place to cover those costs, even marginally,” said Nathan Serota, analyst at Bloomberg New Energy Finance.
Carbon capture and storage plants have been working for years at the scale of demonstrator projects, and some larger ones exist where the gas is used to enhance oil recovery. What’s elusive is a way to make money from the technology on a big scale while preventing further damage to the atmosphere.
Climeworks is one of the few identified as having a plausible way forward. It was among 11 finalists named by Richard Branson’s Virgin Earth Challenge, a contest the billionaire announced in 2007 to award $25 million to the developer of technology that can remove 2 billion tons a year of greenhouse gases from the atmosphere. Branson’s Virgin Group Ltd. has yet to select a winner or pay the prize.
The Swiss company’s technology has a crack because it has customers and a business model that could make money. Its first client is a greenhouse in Zurich, which needs to boost the concentration of carbon dioxide around the plants it’s growing to optimize the photosynthesis process. Climeworks will produce the gas for about 100 Swiss francs ($100) per ton and selling it for about 200 francs to 300 francs.
Other potential markets are carbonated drinks, food preservation and hospitals, Gebald said. These industries are normally supplied by the chemicals industry, which usually derives its flows of carbon dioxide from fossil fuels.
Climeworks is in talks with “the biggest fizzy-drinks company in the world” and expects to sign a deal in the first half of the year. The Coca-Cola Co did not respond to requests for comment, and PepsiCo Inc. declined to be interviewed.
The upside for the drinks-makers is that the air-filtering units can be installed next to factories to produce carbon dioxide on-site. This could make a difference for beverage plants on islands and in countries with low levels of infrastructure such as in Africa, which can disrupt the supply chain and drive up prices for the greenhouse gas.
While the carbon dioxide Climeworks removes from the air returns to the atmosphere when someone pulls the tab on the can of Coke, the company says it’s still helping the planet because its product has half the carbon footprint of what comes from the chemical industry.
“For every liter of CO2 that we suck out of the atmosphere, fossil fuels can stay in the ground,” Gebald said.