My last blog commented on the UK’s Government’s Energy White Paper. While only released in December 2020, so much has changed since then.
The pace of the net zero transition has increased – by early 2021 70% of the world economy will have made ambitious commitments to carbon neutrality. Local to us, the UK Government followed November’s Ten Point Plan with its Industrial Decarbonisation Strategy, reaffirming the Government’s commitments to carbon capture.
Every major emitter I speak to across the cement, refining, steel, energy from waste and biogas sectors, has a carbon capture strategy in place. Interest in CCUS has grown significantly outside of the energy sector – Microsoft, Shopify and even Elon Musk have committed to various carbon capture projects.
We always knew carbon capture would be a multi-billion-dollar market; current IEA projections consider the market opportunity to exceed $1 trillion. We know carbon capture is essential to mitigating climate change; it’s 2021 and the world isn’t getting cooler – I’m glad the technology is finally getting the recognition it deserves.
At Carbon Clean, we’ve felt the huge uptick in interest. Over the past three months, in collaboration with Veolia, we’ve launched a joint venture in India and announced the first energy recovery facility carbon capture trials in the UK. We’ve continued to secure governmental support, having received grant funding from the US Department of Energy to deliver a breakthrough carbon capture project with CEMEX. And lastly, we’ve progressed two notable partnerships with Marubeni and Equinor, using our ‘CCUS as a Service’ to help companies capture and store their emissions.
Most recently we entered into an exciting agreement with portfolio company Liquid Wind to supply carbon capture to its eMethanol site in Sweden. I am particularly proud of this project – eMethanol is a carbon neutral fuel made by combining our captured carbon dioxide emissions with renewable hydrogen. We’re showing how carbon capture can be a source of value creation, as well as a means to cutting emissions – providing value while accelerating the transition to net zero.
With companies realising the need to develop their roadmaps to 2030 and beyond, demand for carbon capture has never been stronger – we saw our project pipeline grow 7-fold last financial year. I don’t expect this growth to slow. The European Union’s benchmark for carbon permits rose to an all-time high of €43.77 per tonne on March 18th and emitting carbon dioxide will only become more expensive – it’s vital emitters adopt low-cost technologies that can decarbonise industrial operations.
Significantly, last quarter our next-gen technology, CycloneCC has moved to the commercial demonstration stage. We’ll be capturing 10 tonnes of CO₂ per day with select partners in the UK, wider European continent and the US – we are on track for full product roll-out by summer 2022. Encouragingly, we are seeing early signs that we can capture carbon at $30 per tonne on average – notably lower than most carbon taxes.
Naturally, with so much activity in the first three months of the year, we have made further hires – bringing our headcount to 38 employees in total, a 153% increase on this time last year. I plan to double the team size within the next 12 months and can say we’ve become well-versed in virtual onboarding by now!
It has been a whirlwind few months but, I’m excited for the next quarter. In the words of Alok Sharma, UK president for COP26, “we cannot afford another decade of deliberation. This needs to be the decade of delivery”. We are working with more companies than ever. Our carbon capture solution has a crucial role to play in helping hard-to-abate sectors decarbonise and more broadly, keep average temperature rises to below 1.5 degrees Celsius.