Background — Direct Air Capture

We need to stay near the 1.5°C goal to solve the global climate crisis. To achieve this, we must adopt a combination of climate adaptation and mitigation measures.

Adaptation can be understood as adjusting to the effects of climate change, such as building resilient homes or building up water barriers. Mitigation means preventing or reducing the emission of greenhouse gases into the atmosphere; it is a human intervention that reduces the sources of greenhouse gas (GHG) emissions and enhances their sinks (anything that absorbs more carbon from the atmosphere than it releases).

Strategies for climate mitigation include renewable energies or carbon dioxide removal (CDR) technologies. Nature-based solutions of CDR include afforestation and change of land use; human-made innovation is taking place, especially in direct air capture (DAC).

DAC, in short, extracts CO2 from ambient air. Industrial-scale fans capture the ambient air and transmit it through a filter. The CO2 can then be permanently stored in deep geological formations or used for commercial use, such as in food processing or for the production of synthetic fuels. Currently, 19 DAC plants are operating worldwide, with Climeworks, Carbon Engineering, and Global Thermostat leading the way in DAC plant development.

Climeworks carbon capture plant in Hinwil, Switzerland (1)

Market Size

While market value remains uncertain, some estimates point to upwards of $100bn in potential value by 2030 (!). Based on an estimated possible deployment of 0.5–5bn tons of CO2 captured each year by 2050, the DAC market could exceed US$500bn per year (assuming a carbon price of US$100 per ton — requiring between $40–750bn in related infrastructure investments each year by 2050. By comparison, global clean energy investment in 2019 was $363bn (3).

This presents a massive opportunity for targeted investment. From the chemistry level to sequestration optimization, we see various companies tackling this important space from different angles.

Both private capital and government spending are needed to advance these technologies to a mitigation level where tangible progress can be seen.

Different Approaches

DAC ​can be seen as the next innovation following carbon capture and storage (CCS). CCS is an emission reduction solution, helping to capture fossil CO2 from point sources and thereby preventing it from entering the atmosphere. DAC, or DAC+S (direct air capture + storage), is a carbon removal solution that captures CO2 directly from the air and stores it permanently.

Whereas CCS requires massive industrial plants tethered to CO2 emission points, DAC, by contrast, can be deployed anywhere as CO2 gets distributed evenly within the atmosphere (4).

Today, two tech approaches are being used for DAC: liquid solvent-based and solid sorbent-based carbon capture systems. Liquid systems pass air through aqueous chemical solutions like hydroxide solutions, thereby removing the CO2. When applying heat, the system reintegrates the chemicals back into the process while returning the rest of the air to the environment. In turn, solid systems use sorbent filters that chemically bind with CO2; when the filters are heated and placed under a vacuum, they release the concentrated CO2 for storage or use (9).

There are different advantages and disadvantages to both approaches. On the one hand, it can be said that solvent-based DAC achieves the highest sequestration efficiency as biomethane is used as a heat source, and thereby an adverse CO2 emission profile is created. On the other hand, the solvent-based approach shows a higher water use than the solid-based one due to the aqueous hydroxide solution, which evaporates during the operation.

Players

The three most prominent and most well-known DAC companies are:

• Climeworks — Switzerland est. 2009, spun out of ETH Zurich, raised $800M to date. Investors include GFC, Microsoft Climate Fund, Carbon Removal Partners, & GIC.

• Carbon Engineering — Canada est. 2009, raised $110M to date, including from BHP Ventures, Chevron Tech Investors, First Round Cap, Incite Ventures, Lowercarbon Capital, Lowercase Capital, Oxy Low Carbon Ventures, Starlight Ventures, and Bill Gates.

• Global Thermostat — the US, est. 2010. Raised ca. $150M, including from Plug and Play, ExxonMobil, and Valhalla Ventures.

Climeworks and Global Thermostat use solid sorbent-based DAC; Carbon Engineering uses liquid solvent-based DAC in a plant whose captured CO2 is then employed for synfuel production (8).

Image Credits: Third Derivative (6)

Other players in the space are trying to develop DAC further as well, including synbio innovation methods. See below some examples:

• RepAir Carbon (Israel) — DAC solution based on electrochemistry

• Carbon Collect/Mechanical Trees (Ireland/US) — energy-efficient DAC tech

• Carbon Capture (US) — solid sorbent DAC process

• NeoCarbon (Germany) — DAC off cooling towers

• Noya (US) — DAC off cooling towers + carbon credit system

• Verdox (US) — electric carbon removal

• Heirloom (US) — carbon mineralisation

• Seabound (UK) — capturing CO2 emissions from ships

• Ucaneo (Germany) — cell-free DAC using synbio

What Happens Once Carbon Dioxide is Captured?

Once the CO2 is captured, it can either be permanently stored in deep geological formations or used for commercial applications such as in food processing (e.g., beverage carbonation) or, combined with hydrogen, to produce synthetic fuels (9). The sequestration method would achieve negative emissions as the carbon is stored; see below:

Schematic illustration of Climeworks DAC process — CO2 turned into carbonate minerals (5)

While re-releasing the captured CO2 in commercial applications, such as burned synthetic fuel, would not create negative emissions, it still generates climate benefits as opposed to conventional fossil fuels.

Schematic illustration of the Climeworks-CarbFix injection at Hellisheidi, Iceland — CO2 captured for commercial use (5)

An illustrative analogy here can be recycled plastic bottles. Single-use plastic bottles are, needless to say, less sustainable than reusable bottles. However, using recycled plastic rather than virgin plastic for the single-use bottles will make them incrementally more sustainable. Indeed, suppose all bottles were produced using recycled plastic and re-used multiple times. In that case, there can be a more significant benefit than reusable bottles such as made of glass (which have a greater energy need for production and transport).

The same principle essentially applies to the captured CO2 of DAC. The CO2 captured needs to be handled in a resource and energy-efficient way to truly create a “circulair” process.

Concluding Thoughts

Although DAC is an up-and-coming technology, it is still in its nascent phase.

The three biggest challenges DAC faces are:

1. It is expensive to build and run;

2. It can pose certain environmental risks, and

3. An unclear commercial use case.

To elaborate on each challenge:

To start with, DAC is still an expensive technology: Because it uses ambient air rather than directly at the point of emissions (e.g., a factory stack), the concentration of CO2 is far lower, which makes separating the CO2 more energy intensive. It is crucial to take into consideration that DAC requires carbon-free electricity sources. Using fossil-fuel-generated energy would release more CO2 into the atmosphere than it would capture. Furthermore, more research needs to be put into the geological storage of CO2 as this increases operational and capital costs further due to the compressor and energy required for injection (8;9).

DAC may also face certain environmental risks: Transporting and injecting CO2 into geological reservoirs for storage can raise concerns about pipelines, CO2 leakage, seismic activity, and water pollution. While companies such as Carbfix (Climeworks Iceland) have developed technologies to reduce the risks of CO2 storage, regulations and continued R&D will be necessary to ensure safe CO2 storage (7).

The commercial strategy around DAC is yet to be shaped: It becomes clear that sequestering captured carbon is the only emission-negative post-capture solution. Yet, there is currently no carbon price anywhere in the world large enough to make sequestration financially viable (7). This problem needs to be addressed for 1250 DAC plants to become a reality (the number of plants needed to remove 25 GtCO2 by 2030 (with a capacity of one MtCO2/year each)) (1). There are currently only 19 DAC plants operating worldwide.

Thus, the public and private sectors need to work not only on DAC tech but also on its infrastructure and financial models to make this promising approach to fighting climate change a viable and sustainable solution.

For more information on the carbon capture space, have a look at the CCS 2021 report on the global status of CCS; or visit Third Derivative’s Report on DAC.

Sources

1. National Geographic, Photograph by Gaetan Bally, Keystone/Redux.

2. Ozkan et al. 2022. Current status and pillars of direct air capture technologies. iScience 25(4).

3. The Economist. Direct Air Capture: Leveraging technological innovation to safely remove carbon dioxide from ambient air.

4. Singularity Hub. 2019. The Promise of Direct Air Capture: Making Stuff Out of Thin Air.

5. Beuttler et al. 2019. The Role of Direct Air Capture in Mitigation of Anthropogenic Greenhouse Gas Emissions. Front.Clim.

6. Third Derivative. Direct Air Capture Insight Brief.

7. Wharton. 2021. Risk Management and Decision; Direct Air Capture: Costs, Benefits, and the Future.

8. ESADE. 2020. Technologies of the energy transition: Direct air capture.

9. IEA. 2021. Direct Air Capture. Tracking Report.