Why we’re in a business we wish didn’t need to exist

Cipher is proud to make our journalism free for all to read and republish. Unless otherwise noted, you may republish our articles for free as long as you abide by our Creative Commons license and the following terms: 

  • Credit Cipher and any co-reporting partners. In the byline, we prefer “Author Name, Publication(s).” At the top of the text of your story, include a line that reads: “This story was originally published by Cipher.” You must link the word “Cipher” to the original URL of the story.
  • If you’re republishing online, you must link to the URL of this story on ciphernews.com, include all of the links from our story and use our PixelPing tag.
  • If you use canonical metadata, please use the Cipher URL. For more information about canonical metadata, refer to this Google SEO link.
  • You can’t edit our material, except to reflect relative changes in time, location and editorial style. (For example, “yesterday” can be changed to “last week,” and “Portland, Ore.” to “Portland” or “here.”
  • For questions or help, please email news@ciphernews.com with the subject line: “Republishing.”
<header><h1>Why we’re in a business we wish didn’t need to exist</h1><a href="/guest-author/" rel="author"></a><span class="title">Guest Author</span><time rel="pubdate" datetime="2023-05-10T00:00:00-04:00">May 10</time></header><p>It’s odd to work every day developing an industry we wish didn’t have to exist. But that’s exactly what we’re doing. Each morning, we wake up and consider the different ways to pull carbon dioxide from the atmosphere—and the technical and economic feasibility of those methods.</p><p>One of the most promising approaches is direct air capture (DAC), <a href="https://t.yesware.com/tt/a48a569fab35e28297891922ba3eb298d4012611/4937ea5b31f0ec729ad5c247d5b667a1/0ade0b9bd62641e4b87c38487f7a7ee2/static1.squarespace.com/static/5b9362d89d5abb8c51d474f8/t/619d471698163e211764c434/1637697304674/DirectAirCapture+ENG+FactSheet.pdf?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">a suite of technologies</a> that use materials such as specially engineered sorbents or limestone rocks to suck already-emitted CO2 from the atmosphere. Pairing this technology with permanent storage locks that carbon away so it no longer contributes to warming.</p><p>Some experts argue DAC is distracting from the need to quickly and rapidly decarbonize every sector of our economy. Thirty years ago, we would have agreed with them.</p><p>But over the last three decades, we’ve released half of all the CO2 emitted <a href="https://t.yesware.com/tt/a48a569fab35e28297891922ba3eb298d4012611/4937ea5b31f0ec729ad5c247d5b667a1/81a0cd9a053788bce917958ca66b270b/ieep.eu/news/co2-emissions-need-to-be-reduced-twice-as-fast-as-the-rate-they-have-gone-up-since-1990?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">since 1750</a> and we continue to emit over 35 billion tons of the gas each year. Carbon removal will be required to pull us back from the brink of climate disaster.</p><p>Under best-case emissions reductions scenarios, we’ll still need to <a href="https://nap.nationalacademies.org/read/25259/chapter/2?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep#8)" target="_blank" rel="noopener" data-hs-link-id="0">remove</a> six to 10 billion tons of already-emitted CO2 per year to keep warming below 1.5°C and to compensate for hard-to-abate emissions from industries like agriculture and aviation.</p><p>We’ve backed ourselves into a corner—we need to stop emitting CO2 and take it out of the atmosphere.</p><p>Deploying DAC at the scale needed to meaningfully address climate change will only be possible if the technologies are economically viable. In the industry, $100 per ton of CO2 removed from the atmosphere is widely considered the <a href="https://www.protocol.com/bulletins/carbon-removal-cost-per-ton?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">threshold</a> for economic viability.</p><p>Some DAC systems currently <a href="https://www.iea.org/reports/direct-air-capture?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">report</a> costs near $1,000 per ton of CO2 removed. This price tag is well above both the threshold and the cost of many other kinds of decarbonization, like replacing emissions-intensive coal plants with renewable electricity.</p><p>Operating a DAC system involves many costs, including equipment, materials and labor. One of the largest cost drivers, however, is the energy required to pull CO2 from the atmosphere. Theoretically, the minimum amount of energy required to remove one metric ton of CO2 from the air is 125 kilowatt hours (kWh), about the same amount of energy as it takes to power a 50-watt light bulb for the better part of a year.</p><p>No DAC technology is 100% efficient (meaning the technology uses the same amount of energy as the minimum 125 kWh to pull carbon from the air). But a system with 10% efficiency is possible. Many energy sources today are much more efficient; wind turbines, for <a href="https://enggcyclopedia.com/2011/12/efficiency-of-power-plant/?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">example</a>, can be 30 to 45% efficient.</p><p>At 10% efficiency, the expected amount of energy required to remove a ton of CO2 is 1,250 kWh. If we assume an electricity price of roughly $0.045/kWh—<a href="https://www.utilitydive.com/news/ppa-prices-supply-chain-interconnection-levelten/634320/?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">consistent</a> with average U.S. renewable electricity prices in the third quarter of 2022—the minimum cost to remove one ton of CO2 is $56. That’s at today’s price, which does not factor in the <a href="https://www.washingtonpost.com/politics/2022/09/16/clean-energy-just-got-lot-more-cost-competitive-report-says/?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">predicted</a> continued decline <a href="https://t.yesware.com/tt/a48a569fab35e28297891922ba3eb298d4012611/4937ea5b31f0ec729ad5c247d5b667a1/026933c4a3b7c12644d49918fc6b482d/rameznaam.com/2020/05/14/solars-future-is-insanely-cheap-2020/?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">in the cost</a> of renewable energy.</p><p>With declining electricity costs, reasonable carbon removal costs are more than possible.</p><p>The math (and existing <a href="https://iopscience.iop.org/article/10.1088/1748-9326/aabf9f?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep#erlaabf9fs4." target="_blank" rel="noopener" data-hs-link-id="0">literature</a>) suggests the cost of DAC could drop from today’s prices by a factor of 10. Industry precedent also supports this assertion. For example, in 1976, <a href="https://ourworldindata.org/grapher/solar-pv-prices?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">solar photovoltaic</a> modules cost over $106 per watt. In 2019, the cost dropped to around $0.4/W. This more than 99% drop is one of many examples.</p><p>With every ton of CO2 we remove from the atmosphere, we are learning how to do it even better. Many <a href="https://carboncurve.substack.com/p/reducing-cdr-costs?utm_source=hs_email&amp;utm_medium=email&amp;_hsenc=p2ANqtz-97j-7u-RB85mxLrrLZmQUQxC6g7MPxJHo2vWZLWC1HPb09_dFRehYiNUWmYOHuk6MGhvep" target="_blank" rel="noopener" data-hs-link-id="0">factors</a> will determine how cost changes as the technology scales: investing in research and development, implementing manufacturing improvements and achieving economies of scale.</p><p>If the time comes when greenhouse gas emissions have been reduced to zero and enough CO2 has been pulled from the atmosphere to restore balance to our climate, we’ll happily cheer as DAC technologies are relegated to the history books.</p><p>Until then, direct air capture will be a key part of saving our planet.</p><p><em>Editor’s note: Heirloom’s investors include Breakthrough Energy Ventures, a program of Breakthrough Energy, which also supports Cipher.</em></p>
Why we’re in a business we wish didn’t need to exist

by  - Guest Author

May 10, 2023


It’s odd to work every day developing an industry we wish didn’t have to exist. But that’s exactly what we’re doing. Each morning, we wake up and consider the different ways to pull carbon dioxide from the atmosphere—and the technical and economic feasibility of those methods.
One of the most promising approaches is direct air capture (DAC), a suite of technologies that use materials such as specially engineered sorbents or limestone rocks to suck already-emitted CO2 from the atmosphere. Pairing this technology with permanent storage locks that carbon away so it no longer contributes to warming.
Some experts argue DAC is distracting from the need to quickly and rapidly decarbonize every sector of our economy. Thirty years ago, we would have agreed with them.
But over the last three decades, we’ve released half of all the CO2 emitted since 1750 and we continue to emit over 35 billion tons of the gas each year. Carbon removal will be required to pull us back from the brink of climate disaster.
Under best-case emissions reductions scenarios, we’ll still need to remove six to 10 billion tons of already-emitted CO2 per year to keep warming below 1.5°C and to compensate for hard-to-abate emissions from industries like agriculture and aviation.
We’ve backed ourselves into a corner—we need to stop emitting CO2 and take it out of the atmosphere.
Deploying DAC at the scale needed to meaningfully address climate change will only be possible if the technologies are economically viable. In the industry, $100 per ton of CO2 removed from the atmosphere is widely considered the threshold for economic viability.
Some DAC systems currently report costs near $1,000 per ton of CO2 removed. This price tag is well above both the threshold and the cost of many other kinds of decarbonization, like replacing emissions-intensive coal plants with renewable electricity.
Operating a DAC system involves many costs, including equipment, materials and labor. One of the largest cost drivers, however, is the energy required to pull CO2 from the atmosphere. Theoretically, the minimum amount of energy required to remove one metric ton of CO2 from the air is 125 kilowatt hours (kWh), about the same amount of energy as it takes to power a 50-watt light bulb for the better part of a year.
No DAC technology is 100% efficient (meaning the technology uses the same amount of energy as the minimum 125 kWh to pull carbon from the air). But a system with 10% efficiency is possible. Many energy sources today are much more efficient; wind turbines, for example, can be 30 to 45% efficient.
At 10% efficiency, the expected amount of energy required to remove a ton of CO2 is 1,250 kWh. If we assume an electricity price of roughly $0.045/kWh—consistent with average U.S. renewable electricity prices in the third quarter of 2022—the minimum cost to remove one ton of CO2 is $56. That’s at today’s price, which does not factor in the predicted continued decline in the cost of renewable energy.
With declining electricity costs, reasonable carbon removal costs are more than possible.
The math (and existing literature) suggests the cost of DAC could drop from today’s prices by a factor of 10. Industry precedent also supports this assertion. For example, in 1976, solar photovoltaic modules cost over $106 per watt. In 2019, the cost dropped to around $0.4/W. This more than 99% drop is one of many examples.
With every ton of CO2 we remove from the atmosphere, we are learning how to do it even better. Many factors will determine how cost changes as the technology scales: investing in research and development, implementing manufacturing improvements and achieving economies of scale.
If the time comes when greenhouse gas emissions have been reduced to zero and enough CO2 has been pulled from the atmosphere to restore balance to our climate, we’ll happily cheer as DAC technologies are relegated to the history books.
Until then, direct air capture will be a key part of saving our planet.
Editor’s note: Heirloom’s investors include Breakthrough Energy Ventures, a program of Breakthrough Energy, which also supports Cipher.