Sylvera, a leading carbon data provider, has secured $57 million in Series B funding round to incentivize companies to invest in real climate impact with carbon credits and expand in the U.S.
Balderton Capital led the round along with other new investors Bain & Company, Fidelity Strategic Ventures and 9Yards Capital, with participation from existing investors Index Ventures, Insight Partners, Salesforce Ventures, Speedinvest, Seedcamp, and LocalGlobe.
Achieving Net Zero Goals with Confidence
Meeting the net zero by 2050 goal is critical if the world has to prevent catastrophic climate-related disasters. But without ramping up emissions reduction efforts, at least doubling the pace by 2030, achieving net zero targets is impossible.
The world also has to remove about 10 Gigatonnes of CO2 from the atmosphere annually by 2050. Reaching net zero calls for capital investment of about $3.5 trillion each year over the next 3 decades. This funding is necessary to build infrastructure and scale up technologies crucial for a zero-carbon economy, including carbon credits.
High-quality credits are important in keeping projects around the world running, such as reforestation and renewable energy deployment. The credits offer one of the most scalable ways to drive climate finance where it’s most needed.
Unfortunately, both climate actions and funding aren’t enough to keep pace with the net zero deadline. What more, tracking progress against climate targets and measuring the climate impact of investments are difficult because of insufficient data.
This is what Sylvera is changing, for the better, as asserted by the company’s CEO and co-founder, Allister Furey, saying:
“Our technology ensures funding is going to the projects, companies, and countries having maximum climate impact to get the world on track for net zero. In time, this data will create much-needed financial incentives, such as higher share prices and cheaper borrowing, for organisations taking serious net zero action.”
The London-based carbon rating agency is helping companies and governments to invest in carbon credits and confidently report on their impact since 2020. With its cutting-edge technology and carbon measurement methodologies, Sylvera assesses climate action investments, including carbon credits, and rates them.
Sylvera’s data infrastructure and carbon intelligence enables companies to confidently reach their net zero goals and deliver global net zero.
Last week, the carbon credit rating firm, along with Pachama, published their carbon market trend report. It sums up the most significant trends that experts foresee shaping the carbon market landscape in 2023 and beyond.
Funding Sylvera’s Growth and Building Its Platform
Sylvera builds software to impartially and accurately assess carbon projects that capture, remove, or avoid emissions to help organizations ensure that they’re investing effectively in real climate impact.
The carbon ratings company uses technology and climate science to develop and test rigorous methodologies to rate projects and produce data. Its unique platform that leverages machine learning facilitates the creation of new sustainable investment products while educating investors about the quality of carbon credits.
Highlighting the role of Sylvera and its innovative carbon rating, Daniel Waterhouse, Partner, Balderton Capital, noted that:
“Sylvera has proven to be the market leader in this emerging field and we are excited to be joining them on the next phase of the journey and their work in accelerating the roll-out of data, tools and software in order to steer a path to reducing damaging climate change.”
Moody’s ratings are to bond credits, Sylvera’s ratings are to carbon credits. Its rating is a combination of these core scoring pillars – carbon, additionality, permanence, and co-benefits. The carbon rating process takes between 60-120 hours, but it depends on the complexity of the project.
Generally, it involves the following steps:
The $57 million investment will help Sylvera further develop its platform and technology to produce the most robust data crucial in climate action investment decisions. The funding will also help the company scale its teams and product offerings as it expands into the US.
Having a new office in New York, a global hub for financial services, will help Sylvera grow its network. The company has 12 new employees in the U.S. right now and will double this team by year-end.
Since its Series A announcement in January last year, Sylvera’s customer base has grown 7x, adding more Fortune 500 clients. This Series B round brings its total fundraising to over $96 million.
Sylvera is serving major financial services providers, governments, and infrastructure suppliers while partnering with large companies like S&P Global.
Once considered as a niche segment of the clean energy industry, the renewable energy sector has now become a significant source of power in the U.S. and around the world.
As companies strive to achieve Net Zero by transitioning away from fossil fuels, they’re relying more on renewable energy sources. Renewable energy plays a crucial role in US, Europe and other wealthy nations’ energy security and sustainability pathways.
It is, therefore, not surprising that businesses and governments are incorporating renewables in their environmental or climate change strategies.
So, why are entities intensifying efforts and investing heavily on renewables in their quest to a cleaner and greener future?
This article will explain everything you need to know about renewable energy, what are its benefits and major sources or technologies. It will also identify the top companies dominating the sector and their renewable energy technologies propelling the net zero transition.
What is Renewable Energy and Why Is It Important?
Renewable energy is energy from natural sources that replenish more than they’re consumed. Solar and wind are the common sources of renewable energy; they’re abundant and are present around us.
On the other hand, non-renewable energy like fossil fuels are finite and takes millions of years to replenish. Coal, oil, and gas are non-renewable sources of energy that once burned, generate large amounts of planet-warming greenhouse gas emissions.
These GHG blankets the planet and trap the sun’s heat, heating up the Earth.
Producing renewable energy releases far lower emissions than burning fossil fuels. Moving away from fossil fuels, which currently account for the lion’s share of emissions, to renewable energy is key to addressing the climate crisis.
This sustainable energy also helps companies reduce reliance on fossil fuels and thus, cut carbon emissions significantly.
So, to avoid the worst effects of climate change, the world has to drastically reduce its GHG emissions. Clean and renewable energy can help us get us there… and it comes with plenty of benefits.
Benefits of Using Renewable and Sustainable Energy
Powering up with renewables brings a range of benefits, the major one is providing a freely available source of power.
As the sector continues to grow, it also creates a surge in job opportunities in developing and installing renewable technologies. Plus, renewables offer better and more affordable access to energy in emerging economies. Renewables are now cheaper in most countries and generate 3x more jobs than fossil fuels.
And of course, one of the biggest benefits of sourcing energy from renewables is the fact that they’re mostly clean and sustainable.
The diagram shows the major difference between renewables and fossil fuels in key aspects, including carbon content, cost, and supply. Moreover, rain or shine, the most abundant of renewable resources – solar energy – can be harnessed even in cloudy weather.
And did you know that the rate at which solar energy strikes the Earth is 10,000x more than the rate at which humans consume energy? That means it’s impossible for us to exhaust the energy that the sun provides.
It’s just that the world must invest $4 trillion annually in renewable energy by 2030 to reach net zero emissions by 2050. Still, the return on this investment will be more than 6-fold – $26 trillion!
In sum, here are the environmental and economic benefits of using renewable energy:
Producing energy that releases less or no GHG emissions from fossil fuels and reduces air pollution
Diversifying the energy mix and cutting reliance on imported fuels
Creating more jobs in manufacturing, installation, maintenance, etc.
However, these benefits are not only possible with renewable sources. Nuclear power, too, is dubbed as a clean, zero-carbon energy source; it emits much lower carbon. Some favor nuclear over renewables like solar and wind because it’s a stable source that doesn’t rely on weather conditions.
Still, the pros of renewable and sustainable power sources outweigh their cons and their consumption will continue to increase sharply.
So, what are the common renewable energy sources or technologies available right now? Let’s talk about the top five ones.
What Are the Main Sources of Renewable Energy?
There are different technologies that can be used to generate renewable power but the most common ones are the following.
Solar Energy
Rain or shine, solar energy remains the single most abundant source of renewable power. It can be harvested during cloudy weather.
Moreover, the cost of producing solar panels has gone down substantially in the last 10 years. This makes renewable energy from the sun both affordable and often the cheapest. Not to mention that solar panels can stay up to about 30 years.
That could be longer as better materials and technologies are becoming available that make them even 1,000x more powerful. This breakthrough is courtesy of the researchers at Martin Luther University Halle-Wittenberg (MLU).
Solar technologies convert sunlight into electrical energy through photovoltaic (PV) panels or mirrors that concentrate solar radiation. While not all nations have equal access to sunlight, a considerable share to the energy mix from solar is still possible for every country.
Wind Energy
This type of renewable energy is infinite as long as the air moves that turns the large wind turbines. It has been around for thousands or even millions of years, even longer than solar energy.
But it has evolved and improved in generating electricity with both onshore and offshore wind energy technologies getting better. Their turbines become taller and the rotor turns bigger.
And like solar, the potential to generate power through the wind goes far more than the world’s demand for electricity. Most regions of the world are capable of deploying renewable wind energy, with offshore capacity offering huge potential.
Hydropower
You might be surprised to know that power from water is the largest share of renewable energy in the power sector. Hydropower can be produced either from running rivers or reservoirs of stored water.
Reservoirs of hydropower also provide drinking water, irrigation, navigation, drought control, and more. But it depends largely on stable rainfall patterns, so climate-related events like droughts can negatively impact its power generation. Small-scale hydropower is best in remote communities.
Geothermal/Hydrothermal Energy
Another renewable source of power comes from the inner part of the Earth – heat or geothermal reservoirs. It can be harnessed through wells or any other means.
Two kinds of this energy reservoirs are available: hydrothermal, naturally hot enough to create power, and geothermal, hot but needs improvement using hydraulic stimulation. Hot fluids that get on the surface are useful in producing power.
Generating electricity from hydrothermal reservoirs has been going on for over a century.
Bioenergy
This technology is quite different because it needs more processing to convert to energy. It can be produced from various organic materials known as biomass such as agricultural waste, wood, charcoal, and animal manure.
Compared to burning fossil fuels, burning biomass releases lower GHG levels. However, bioenergy won’t be good for most energy applications because large-scale use may involve significant land-use changes like deforestation. Popular applications would be in aviation as green fuels.
Current State and Outlook for Renewables
As we scramble on our feet to decarbonize the global economy, we need a new energy system that does away with fossil fuels. And clean, sustainable, and renewable sources are the key to it.
The current state of renewables tells us that this new energy is our future. In fact, renewables will account for 90%+ of global electricity capacity expansion from 2022-2027, according to the International Energy Agency.
The global energy crisis is pushing the accelerator on this renewable energy expansion. The Russian-Ukraine conflict has particularly sparked great momentum for renewables.
Moreover, disruptions in fossil fuel supply underlined the benefits of generating domestic energy from renewable sources. It alleviates energy security issues many countries face in relying on fossil fuels. Thus, national governments have and are strengthening policies that boost renewable energy like the case of China, India, the U.S., and the EU.
Higher fossil fuel prices also bolster the competitiveness of renewables, especially solar PVs and wind power against other fuels.
All these factors drive the growth in renewable energy capacity additions as seen in the chart below. Historical data shows rising new renewables capacity from 2017 to 2024.
Net RE Capacity Additions by Technology, 2017-2024
Recently, the United Arab Emirates (UAE) revealed plans to invest $54 billion in renewables over the next 7 years. The largest oil-producing country hopes to achieve 14GW capacity of clean energy by 2030.
Earlier this year, the retail giant Amazon received a go signal from Indian authorities to start trading renewable energy sources in the country. The company has signed a total of 720 MW worth of energy purchasing agreements in India from different renewable sources, solar and wind.
These supports for clean and sustainable sources could be driven by the promising outlook for renewables. The IEA projections show continuous growth for this clean energy sector.
The agency estimated that renewables will become the biggest source of global electricity generation by early 2025, exceeding coal. Annual renewable capacity additions are forecast to increase continuously, hitting a record 460 GW in 2027. In an accelerated case, this capacity goes up to almost 600 GW in the same year as shown below.
In Europe, which is the second largest market after China, renewable electricity expansion will double by 2027 as energy security issues become part of the bloc’s climate ambitions.
The same trend is forecasted in other developed regions and this seems to be the way forward as the world decarbonizes even more. So, who are the major players in this sector?
Four names stand out in the list of top renewable energy companies.
What Are the Top Renewable Energy Companies?
1. General Electric Co. (GE)
As a Fortune 500 company and one of the largest American corporations with an $89 billion market cap, General Electric (GE) is widely recognized for its innovations in power and renewable energy. The company has made huge strides in developing green energy solutions and became a key player in the industry.
GE has been at the forefront of wind energy technology, consistently enhancing turbine designs and improving efficiency. Here is GE in numbers when it comes to its wind energy solutions.
As one of the world’s leading wind turbine suppliers, GE has installed over 49,000 units that generate wind electricity across the globe.
In addition to wind power, GE has also invested in other renewable energy technologies, such as solar power, hydroelectricity, and hybrid.
More remarkably, the top renewable energy company offers data-driven insights, expert recommendations, and advanced field services – all integrated into a single software platform. This capacity drives more revenue up, costs down, and risks lower in providing wind energy systems.
2. NextEra Energy, Inc.
Making it to the second spot is Florida-based energy solution provider NextEra Energy.
Running with a whopping $147 billion market cap, NextEra has been investing billions in developing renewable energy sources. As one of the largest renewable energy producers in the world, the company leads the charge in solar and wind energy production.
NextEra currently generates a capacity of about 30,000 megawatts from both sources. Its clients are retail and municipal electricity providers, industrial companies, and power cooperatives. With $135 billion in total assets, NextEra is indeed a leader in electricity generated from wind and solar with this coverage.
Map represents areas where NextEra Energy has a presence, operations or development projects. Locations with more than one facility are illustrated with a single dot. Data as of December 2021.
The company aims to invest up to $95 billion in American renewable energy infrastructure through 2025. It’s the same year that the firm plans to reduce its own CO2 emissions by 67% from 2005 levels.
With the slogan “a real plan for a real zero”, NextEra is helping ensure that the next energy to bring America to net zero will be clean, renewable energy.
3. Iberdrola SA
With a market cap of over $72 billion, Spain-based multinational electric utility company Iberdrola SA has more than 170 years of history. The company is a global leader in the generation, distribution, and trading of clean energy.
Iberdrola specializes in onshore and offshore wind, hydro, solar PV, and battery storage solutions. Aside from Spain, it also operates in the U.S., U.K., Mexico, Brazil, and many more countries, over 40 countries, in fact.
Its huge global operations footprint makes it one of the largest renewable energy providers worldwide. The company also covers other clean energy sources like nuclear and natural gas, boasting a diverse energy portfolio.
4. Orsted A/S
Renewable energy company Orsted A/S excels in developing, building, and operation of offshore wind farms. The Danish firm currently owns the prestigious title of being the world’s biggest offshore wind power developer, with a total capacity of over 7.5 GW.
Standing tall at a $36 billion market cap, Orsted A/S has established offshore wind farms in different countries, including the UK, the US, Germany, and Taiwan.
The top renewable energy company visualizes a world that runs entirely on green and renewable energy to limit climate change and power the world sustainably. With that, the company aims to achieve a 99% renewable share of its energy production by 2025.
Renewable Energy Share of Power Production
Overall, it aims is to build 50GW of energy generation capacity across all green energy technologies by 2030. 30 GW is for offshore wind capacity.
The Future Lies in Clean and Renewable Energy
Renewable energy will continue to rise unstoppably, slashing greenhouse gas emissions as it edges out fossil fuels.
Now is the pivotal time for cleaner, greener, and renewable sources of energy. Renewables are at the heart of transformations happening in the global energy system. Their growing deployment is vital for efforts to fight climate change, bring down global temperatures, and save our only planet.
The voluntary carbon market is gaining momentum in Africa, with Tanzania revealing that it will receive over $20 billion investment in carbon offset credits from more than 20 companies
Dr. Selemani Jafo, Minister of State in the Vice President’s Office, Union and Environment, emphasized that the adoption of legislation on carbon trading in the African nation last year brought in over $1 billion investment. This money will be used to fund carbon trading activities across Tanzania.
Dr. Jafo further noted that carbon credit trading will help the country’s Nationally Determined Contributions (NDCs). The nation aims to cut GHG emissions by 30% -35 % by 2030. The minister said that:
“We need to establish further cooperation between Tanzania and carbon credit investors and partners for our economy and future generations…We are committed to supporting all investors and stakeholders in carbon trading in our country.”
Investing in Forest Carbon Credits in Tanzania
Carbon credits are market-based financial instruments that represent a reduction in carbon emissions certified by independent international bodies or governments. As businesses and organizations look for viable ways to curb their CO2 emissions, carbon credit markets become their turn-to solution.
The credits are from various projects or initiatives that reduce greenhouse gas emissions. In Tanzania, carbon credits play a crucial role in preserving forests and protecting the way of life of local communities.
The carbon market presents an opportunity for the country to generate funds and address deforestation and forest degradation. The East African nation has 48 million hectares of reserved forests, which offers significant opportunities for carbon trading.
With the $20+ billion investment, the carbon market in Tanzania will experience a revolution. Each credit is equal to one metric ton of CO2, or its equivalent, reduction or removal.
The 20 companies that committed to investing in carbon credit projects in the country are from the U.S., Canada, Switzerland, Russia, Italy, Singapore, Estonia, UAE, and Kenya. Their applications were received by different agencies and institutions in Tanzania. Their investment will protect reserve forests and village forests, as well as game reserves and community-based wildlife management areas.
The country is also working on the biggest carbon credit project in Africa. It’s under the partnership of the Tanzania Wildlife Management Authority and GreenCop Development PTE, a Singapore-based company. Their collaboration seeks to develop carbon projects in Tanzania.
The Increasing Value of Carbon Credits in Africa
Africa has been grabbing the spotlight in the carbon credit market. Last May, the 3rd-largest credit producer in the continent accounting for 13% of Africa’s total revenue, Zimbabwe, required that half of the sales go to the nation’s treasury. Zambia, the 5th biggest producer of carbon credits, also has plans to do the same.
Recently, the former South African president, Jacob Zuma, unveiled that the Belarus African Foreign Trade Association will list the first carbon credits on a newly created exchange in Zimbabwe. He further stated that 2 million credits will begin to trade on the African voluntary carbon market.
Meanwhile, Africa’s largest supplier of carbon credits, Kenya, is in the process of regulating its carbon market. Malawi has also formed a dedicated agency to take on this matter.
Apparently, governments in African developing nations are positioning themselves strategically in the emerging carbon markets. They are developing mechanisms and frameworks to ensure that carbon credit projects in their respective territories are reliable in attracting investors and innovating nature-based solutions to climate change.
ExxonMobil buys Denbury Resources for ~$5 billion to boost its carbon capture, utilization, and storage (CCUS) capacity and ramp up its low-carbon energy strategy.
Denbury Resources is an oil and gas producer, specializing in running an extensive CO2 pipeline transport network. It runs across the U.S. Gulf Coast, which includes major oil extraction facilities in Texas, Louisiana, and Mississippi.
Why Exxon Buys a Small-Scale Oil Business?
It’s all about carbon.
The major oil company’s move to acquire Denbury for $5 billion is for its existing CCUS infrastructure.
Carbon capture and storage is a booming industry that’s becoming more important in the US. Thanks to President Biden’s Inflation Reduction Act which provides tax credits for companies that operate it.
The infrastructure needed for CCUS on a large scale is expensive while building new pipelines is often opposed.
Thus, Denbury’s existing pipeline infrastructure stretching 1,300 miles is highly valuable. The small oil company has been using CO2 for enhanced oil recovery (EOR). This process injects the gas into oilfields to boost oil production.
Denbury is using carbon captured from industrial sources and injects 4 million tons of CO2 every year.
By buying Denbury, Exxon will own the largest operating carbon pipeline network in the country. The Gulf Coast region, in particular, is one of the biggest markets for CCUS in the U.S. Denbury also runs 10 onshore carbon sequestration sites represented in the following map.
Source: ExxonMobil
Boosting Low-Carbon Energy Strategy
Exxon believes that its acquisition of Denbury will help in its lower-carbon energy strategy through a cost-effective CCUS system that it can integrate with its existing carbon solutions.
As shown in the map, the combined Exxon-Denbury system can potentially reduce CO2 emissions in the region by over 100 million metric tons per year.
The oil major considers CCUS a significant business, estimating that it will be a $4 trillion global market by 2050. This presents a multibillion-dollar income opportunity for Exxon and a revenue stream that will be more valuable and stable than oil and gas.
This strategy builds on the foundation of long-term contracts that can provide Exxon with a more predictable cash flow stream. The oil company had inked commercial deals to capture and sequester CO2 from various industrial polluters underpinning sequestration hubs it’s building on the Gulf Coast.
Over the past months, Exxon has partnered with fertilizer company CF Industries, steel manufacturer Nucor and gas producer Linde to capture CO2 from their factories, and transport and store it.
Integrating Denbury’s infrastructure will strengthen Exxon’s ability to capture more CCUS opportunities plus carbon credits.
Carbon capture and carbon credits have been the craze recently in an emerging carbon market. More and more companies are showing huge interest in the market as legislation accelerates worldwide.
Betting on the Carbon Credit Market
Buying Denbury will allow Exxon not only to deliver on its various CCUS deals but gives it a great potential revenue source as the carbon credit market matures.
While still in its early market stage, carbon credits enable companies and industries that can’t easily cut their carbon pollution to offset their carbon emissions.
Heavy emitters that have no viable alternatives to significantly reduce reliance on fossil fuels turn to carbon offset credits. The cash from the credits will fund or technically support carbon reduction projects and initiatives.
Each credit equals one tonne of carbon reduced or removed (with CCUS) from the atmosphere.
It’s not only Exxon that’s betting on carbon capture and the credits it generates. Other big oil companies are also putting their money into it such as Occidental, Chevron, and Shell.
There are also other carbon capture approaches designed to draw CO2 directly from the air instead of industrial plants. The captured CO2 is also transported toward its destination, either deep underground or for further application.
The CCUS, same with other carbon market segments, also comes with critics. Some think that the sector won’t be feasible while others believe it doesn’t cut dependence on fossil fuels.
Still, the upward trend and positive outlook of the market show that carbon credits serve a significant purpose in cutting down carbon emissions. Be it for providing alternatives to fossil fuel reliance or promoting sustainable business practices, the carbon credit market is projected to grow strongly.
Exxon’s $5 billion purchase of Denbury sees them placing a flag in the carbon market space. The strategic acquisition will allow the oil producer to scale up its low-carbon business. Their deal will close in the fourth quarter of this year.
Overall, Exxon plans to invest a total of $17 billion on low-carbon projects and cutting down its own carbon emissions.
The U.S. Department of Agriculture (USDA) announced that it will invest $300 million to improve the measurement and reporting of greenhouse gas emissions and carbon sequestration by the country’s agriculture and forestry sectors.
The fund will be from the country’s climate law, the Inflation Reduction Act (IRA). The Act provided about $20 billion in total investments to boost climate-smart agriculture and forestry practices.
The money will be used for creating a rigorous research system for monitoring carbon levels in soil – a key to understanding how CO2 is stored in the ground. It will further help the department in enhancing its data management capacity and improving the methods it uses in quantifying and analyzing GHGs.
Slashing Carbon Emissions and Earning From It
As per the Environmental Protection Agency, agriculture is responsible for emitting 10% of the country’s GHG in 2021. With that, the USDA’s $300 million investment will give farmers and ranchers opportunities to earn more by adopting climate-friendly practices.
There are various carbon emission reduction strategies that farmers can employ and earn more from doing them.
Common examples are no-till agriculture and planting cover crops, which both can make the soil healthier and less erosive. These and more practices are often called regenerative farming.
More importantly, the soil may be able to capture and store more carbon dioxide than conventional farming practices. If farmers can quantify and monitor how much their new practice sequesters CO2 in the soil, they become eligible for earning carbon credits.
One credit represents one tonne of carbon reduced or removed from the atmosphere.
When it comes to their potential to help soil capture more CO2, here’s how different carbon farming practices could slash agriculture’s emissions by 2050.
Better Data for a Robust Carbon Market
While soil carbon storage has been around for a long time, scientists warn that there are uncertainties on the exact amount of carbon emission reduction it delivers.
Last month, a team of researchers found that carbon stocks stored underground in soil forests are vulnerable to global warming. More heating of the earth causes significant loss in carbon stored in deep soils, at over 30cm depth (12 inches).
Their findings pose challenges to how the sector used to measure carbon stored in soil and its climate impact. Add to this the fact that the process of measuring CO2 deep underground is highly technical and time-consuming.
And switching to new carbon farming techniques may not be convincing for some farmers, especially if it means more expenses.
This is why the Agriculture Department will heavily invest in finding more and better data on carbon sequestration. Better monitoring and reporting on soil carbon capture and storage data is crucial for a more robust carbon market. These markets can help incentivize farmers and ranchers to engage in carbon reducing practices.
Remarking on this matter, John Podesta, Senior Advisor to the President for Clean Energy Innovation and Implementation said that:
“One of the big remaining technological challenges for tackling the climate crisis is ensuring that natural solutions in agriculture and forestry are working well… Today’s USDA announcement of $300 million from the Inflation Reduction Act to measure and verify emissions from those sectors is a big step in the right direction.”
The ultimate goal is to bring confidence in farmers and foresters to embrace climate-friendly practices, compensating their efforts while protecting them from any risks that may come in shifting to new technologies. Making this a national concern through a policy is indeed a good thing, both for America and the planet.
USDA is engaging with stakeholders and technical experts to help inform its effort in finalizing the strategy. The Department will hold a webinar for those interested to learn more about it or contribute insights on July 21.
L.A.-based carbon capture startup Avnos signed strategic investment deals worth over $80 million with big oil companies, Shell and ConocoPhillips, and JetBlue to ramp up commercialization of its novel Hybrid Direct Air Capture (HDAC) technology.
Founded in 2020, Avnos focuses on developing and deploying scalable, flexible, and cost-effective technology in the DAC market.
The company has been awarded multi-million-dollar projects from the U.S. Department of Energy to demonstrate its HDAC solution. It also got awards from the U.S. Office of Naval Research to pilot carbon capture and e-fuel production.
Avnos’ Hybrid DAC Technology is a “Twofer”
Global greenhouse gas emissions hit record high in 2021 and projection shows the figures will continue to increase without rapid climate actions done. This year’s record-breaking wildfires, storms, floods, and heat events are the proofs.
To prevent those disasters from getting worse, reducing carbon emissions and removing what’s already in the air are critical. Climate experts highlighted the need for billions of tons of annual CO2 removal (CDR) capacity to significantly reduce emissions.
That gave rise to the birth of different startups with the aim to remove carbon dioxide. Popular existing DAC companies include Climeworks, Global Thermostat, Charm Industrial, and Equatic among others. They’re taking different approaches to directly removing CO2 from the air and water.
But what Avnos is offering to the market is unique and innovative: capturing carbon and producing water anywhere there’s air.
The carbon capture company said that its novel HDAC tech is a “twofer” for tackling the climate crises. Its pioneering moisture-responsive carbon adsorbent tech directly sucks in CO2 from the air and produces water as a byproduct.
In a sense, it’s addressing global warming and water scarcity. Plus, it doesn’t use heat as an input but employs a moisture swing adsorbent instead, which significantly lowers energy consumption.
In comparison, existing DAC approaches consume large quantities of water while Avnos HDAC produces water. The water byproduct is then used to drive the company’s carbon capture operations.
According to the startup, its HDAC performs best in four major areas versus other DAC systems in place. These include total energy use, thermal energy use, water consumption/production, and costs. The video shows how Avnos hybrid direct air capture technology works.
Last week, a similar carbon capture technology by another California-based startup, Capture6, secured a grant of over $8 million from the California Energy Commission. The company also produces freshwater in removing carbon but uses brine, a byproduct of water treatment facilities, to produce a solvent that captures CO2.
Removing Carbon and Selling Credits
Avnos HDAC system uses modules about the size of a 20-foot shipping container. It pulls in air and runs it in a series of filters and condensed water is then collected, pumped out, and stored. The captured carbon goes into the storage tank.
The company said there’s a 5-to-1 ratio of water produced for each ton of captured CO2. This water may create more revenue streams for Avnos while the big oil backers can convert the CO2 into e-fuels.
The $80+ million investment is a huge bet on engineered or technological solutions for mitigating climate change.
ConocoPhillips finds Avnos carbon capture technology a promising solution that “reduces carbon emissions crucial to enable an orderly energy transition”.
What captures Shell Ventures’ interest is the “potential of Avnos’ technology to reduce energy demand in capturing CO2”. JetBlue believes that the HDAC system plays an important role in e-fuels production.
Remarking on their strategic partnerships, Will Kain, CEO of Avnos, said:
“Adding blue-chip strategic partners such as ConocoPhillips, JetBlue Ventures, and Shell provides us with an incredible opportunity to access more resources, know-how, and global reach to meaningfully accelerate our deployment schedule. Ultimately, we will be able to remove more atmospheric carbon, faster, and at lower costs than we would have been able to on our own.”
The amount of carbon removed by Avnos generates corresponding carbon credits that it can use to offset its own emissions. Each credit equals one tonne of carbon removal. Or the startup can turn it into an income source by selling them to other companies looking for carbon offsets.
A pilot version of the Avnos HDAC facility will open later this year in Bakersfield, California. It can remove 30 tons of CO2a year and produce 150 tons of water.
A bigger, commercial-grade system can increase this capacity by 100x – 300 tons of carbon and 1,500 tons of water. The modules are stackable to increase the capacity even more but would need larger renewable power installations.
Avnos will use the funding to supply commercial-ready HDAC systems by the end of 2025.
At the recent Carbon Markets Summit, research firm Sylvera along with Pachama convened a global assembly of thought leaders to delve into the present complexities and future potential of the carbon market.
This comprehensive guide, a collaborative effort between Sylvera and Pachama, sums up the ten most significant trends that these experts foresee shaping the carbon market landscape in 2023 and beyond.
One of the key areas where this is happening is in the carbon credit market. It is where accurate and in-depth ratings and analytics are essential for effective decision-making.
Five Key Points from the Pachama and Sylvera Report
Delving into the report, five key points emerge that summarize the current state and future trajectory of this critical sector.
Market in Flux: The voluntary carbon market is undergoing significant changes due to new climate disclosure regulations, guidance from market bodies, and increased media attention. This has caused some confusion and hesitation among potential buyers. Still, the need for carbon project funding is more critical than ever.
Flight to Quality: Corporate buyers are participating in a ‘flight to quality‘. They are becoming involved earlier in projects and focusing on contribution over ‘offsetting’. This trend will continue in 2023 and beyond.
Technology and High-Quality Projects: Technology is unlocking greater supplies of high-quality projects. Companies like Sylvera and Pachama are using data and artificial intelligence to help companies invest confidently in high-quality carbon credits.
Carbon Credits – ‘Last, but not Later’: The mitigation hierarchy encourages emission reductions first and carbon credits last. However, ‘last’ does not have to mean ‘later’. Companies can purchase carbon credits throughout their decarbonization journeys, as long as these purchases do not replace actual emissions reductions across the value chain.
Voluntary Carbon Market Growth: Despite challenges with legacy credits, limited high-quality supply, and ongoing work on official guidance, the corporate demand for carbon credits is strong. The voluntary carbon market is still growing, and the overall trajectory for the VCM looks positive.
Voluntary credit retirements remained strong in 2022 at 184 million and are on track to beat records in 2023.
These insights paint a vivid picture of the market’s present dynamics and future potential. The report underscores the pivotal role of carbon credits in steering corporate strategies towards decarbonization.
It also champions the cause of investing in high-quality projects, a move that promises both environmental and economic dividends. It also highlights the ongoing growth and evolution of the voluntary carbon market.
A lot of insights on carbon market trend were shared during the summit, but here are the ones that are worth sharing.
3 Meaningful Insights That Stand Out…
1. “Companies leading on climate are demonstrating the difference between hierarchy and chronology: ‘last’ does not have to mean ‘later’.”
While carbon credits are often seen as the last step in a company’s decarbonization journey, they don’t have to be the final action taken. Companies can and should invest in carbon credits throughout their decarbonization process. But as long as these purchases are not used as a substitute for actual emissions reductions.
The report warns that critical carbon sinks, such as the Amazon Rainforest, are reaching a tipping point. Also, the need for funding for conservation and reforestation efforts is critical.
Companies are encouraged to invest in carbon credits as soon as they set science-based targets with clear plans for achieving them, not just once they have reached their decarbonization targets.
2. “Organizations that invest in carbon credits are cutting emissions at twice the rate of their non-credit-buying peers.”
3. “We’re seeing more and more people move upstream to secure these future optics of quality credits that they can’t find on the spot market today. So really, quality is front of mind, even in the upstream space.”
This highlights a trend in the carbon market where corporate buyers are moving upstream. It means they’re investing in early-stage carbon projects to secure future supplies of high-quality credits.
This shift is driven by the understanding that investing early not only shows commitment to the market but also allows for some control over the project’s development.
Mercedes-Benz announced that they sold 56,300 electric vehicles (EVs) in Q2, up 123% from the same quarter in previous year. This affirms the German luxury carmaker’s commitment to reducing its carbon emissions and bringing its new fleet to net zero across the value chain by 2039.
Fully EVs now account for 11% of Mercedes-Benz overall sales year-to-date that’s also up by 6% in Q2. The sales were bolstered by strong demand for EVs particularly in Germany and the U.S.
Increasing this percentage is crucial for the company to continuously reduce and eliminate its carbon emissions.
Mercedes-Benz’s Carbon Footprint
The luxury carmaker has been accounting for its carbon emissions – Scope 1 and Scope 2 – in accordance with standard protocols.
In 2022, Mercedes-Benz has the following carbon emissions, which don’t include Scope 3 accounting. The first table is for its entire operations while the second is specific CO2 emissions per vehicle type.
Total carbon footprint from energy use in 2022 is 663 tons (market-based), down by 42% compared to 2021 (1,148 tons). The same trend can be observed for the CO2 emissions specifically from each vehicle type shown below. Total pollution from cars was down by over 51% while emissions from vans also went down by 43%.
The company’s goal is to cut by at least 50% the emissions per passenger car by the end of this decade, compared to 2020. The goal of cutting the carbon emissions of its new car fleet by 40% compared to 2018 in relation to the use phase (well-to-wheel) has been approved by the Science Based Targets initiative (SBTi).
Mercedes-Benz Climate Pledge and Transform to Net Zero
The luxury car brand aims to go all electric by 2030 as part of its ambitious electrification and decarbonization goals. In detail, here are the company’s climate targets and its progress as of 2022.
Achieving these requires various means, including renewable energy, charging with green electricity, improving battery technology, among other emission elimination strategies.
The German automaker joined Amazon’s initiative “The Climate Pledge” aimed at contributing to meeting the Paris goals ten years earlier. In signing the agreement, Mercedes-Benz agrees to:
Measure and report GHG emissions regularly,
Implement decarbonization strategies in line with the Paris Agreement, and
Invest in initiatives that compensate unavoidable emissions with real, additional, permanent, and quantifiable carbon offset credits.
The carmaker joined the Amazon and Global Optimism climate pact in 2020, supporting it with its own decarbonization initiative – the Ambition 2039. This ambition means making the entire new vehicle fleet of the company carbon neutral across the value chain by 2039.
In the same year, Mercedes-Benz Vans and Amazon revealed the largest order by Amazon for EVs from the German carmaker. The giant retailer ordered over 1,800 battery-electric vehicles for use across Europe.
About ⅕ of total GHG emissions in Europe are a result of transporting people and goods. The Stuttgart-based carmaker is taking actions to address this trend and integrate climate change mitigation into its core business strategy.
Hence, Mercedes-Benz is also a founding member of “Transform to Net Zero“, a climate initiative of nine large companies and launched by Microsoft. Its goal is to pool the companies’ expertise to create positive conditions for a broader decarbonization of the economy and society.
Emphasizing the importance of this net zero transformation, the company’s COO Markus Schäfer said that:
“With Ambition 2039, we have marked out a way for Mercedes-Benz to bring our new car fleet to “net zero CO2” within less than 20 years – and not only in driving operations, but along the entire value chain. Starting in 2022, our passenger cars and vans will be produced CO2-neutrally in the more than 30 plants of Mercedes-Benz AG worldwide.”
Directly Sourcing Lithium for Sustainable Electrification
One big part of turning those ambitions into reality is by securing high-quality lithium for EV battery production. Directly sourcing this mineral is vital for Mercedes-Benz to scale up its fully EV production.
Lithium hydroxide is needed for the production of lithium-ion batteries used in the German carmaker’s EVs.
Last year, the automaker inked a supply deal with Canadian-German-start-up Rock Tech Lithium for the supply of battery-grade lithium hydroxide. The deal provides that both companies work together to create a roadmap to achieving carbon neutral lithium production by 2030.
Their partnership was revealed after the signing of agreement between Mercedes-Benz AG and Canada to explore more cooperation across the automotive value chain, focusing on natural resources development. Responsibly mined and processed materials like lithium are key for achieving a sustainable electrification of Mercedes-Benz entire vehicle fleet.
The U.S. is also in desperate need of a massive supply of domestic lithium to get to net zero. American Lithium Corporation, which has two of the largest lithium deposits in the Americas, aims to fill in the huge gap in supply and demand for this critical mineral.
And as demand for luxury electric vehicles continues to rise, so too is Mercedes-Benz’s need for more lithium. In choosing resource sourcing partners, the German automaker decides based on protection of human rights and the environment.
Ultimately, Mercedes-Benz never stops working on finding ways to further cut down its CO₂ emissions as well as the amount of rare metals needed for each electric vehicle it manufactures.
CarbonCure Technologies closes more than $80 million in a new equity round led by Blue Earth Capital to bolster the company’s global scale of carbon removal technologies and supply of carbon credits.
Nova Scotia-based CarbonCure Technologies is a leader in CO2 removal technologies for the concrete industry and a provider of high-quality carbon credits. The new funding will help strengthen the company’s carbon removal technology while expanding its supply of high-quality carbon credits.
Blue Earth Capital is a mission-driven, global investment firm advocating for sustainability through its growth investments. Through its Climate Growth Strategy, it supports companies that significantly contribute to global energy transition and decarbonize major economic sectors.
In addition to Blue Earth Capital, other serial investors of the round include Amazon’s Climate Pledge Fund, Microsoft Climate Innovation Fund, Breakthrough Energy Ventures, Taronga Ventures, and 2150. New investors participating in the round are Samsung Ventures and BH3 Growth Equity.
Doubling Down Efforts in Cutting Concrete’s Emissions
Buildings are responsible for about 40% of global greenhouse gas emissions annually, making them a major source of carbon pollution.
The embodied carbon – CO2 released in creating building materials – accounts for almost 50% of carbon emissions from new construction. Of that, about 8% is courtesy of producing cement, a key material in making concrete.
Emissions from producing cement stood at 1.7 billion metric tons of CO2 in 2021. Here’s how its carbon emissions grow for decades.
Each 1,000 kg of cement production generates more than 900 kg of carbon emissions.
This is particularly what CarbonCure targets, to reduce the emissions of carbon-intensive concrete with its unique carbon removal technology. It injects captured carbon into fresh concrete, locking up the gas so it doesn’t return back into the atmosphere. As the process lowers the amount of cement needed in every mix, the concrete’s carbon emissions also decrease.
The climate tech company said that its technologies have already produced about 5 million truckloads of low-carbon concrete. This results in saving around 290,000 metric tons of CO2, or removing 64,000+ gas-powered cars off the road in one year.
The $80 million investment will allow CarbonCure to scale up its CO2 removal technology and remove millions of tonnes of carbon emissions annually. It will also support the company in ramping up its product roadmap and reaching its growth plans. To date, it operates in thirty countries.
The majority of the new investment will be for expansions in Europe, the Middle East, Latin America and Southeast Asia.
Overall, it will allow CarbonCure’s platform to provide more sustainability value to concrete producers while contributing to global climate goals. The company’s Chair and CEO, Robert Niven, asserts how important this new funding is to CarbonCure, saying:
“With more than 750 systems sold, this latest investment will drive CarbonCure’s deployment across the global concrete industry as the private sector doubles down on sustainability in new construction and as federal, state and even municipal procurement policies requiring green building materials continue to multiply.”
Carbon Removal and High-Quality Carbon Credits
Niven further noted the investment’s role in advancing decarbonization efforts and accelerating “immediate, permanent and verifiable” carbon removal pathways.
It promotes CarbonCure’s solution for low embodied carbon concrete. The company’s carbon removal technology also tracks and measures carbon from the point of capture to mineralization in concrete mixes.
This method allows carbon credit buyers to track the precise date and location of CO2 storage.
Other carbon removal solutions focus on removing CO2 and storing it deep underground. But CarbonCure’s tech brings more value to captured CO2 – use it for making low-carbon concrete.
Thus, the carbon credits they create are of high quality as they don’t just remove CO2 but help the concrete industry in reducing its carbon footprint, too.
CarbonCure’s cutting-edge innovations have attracted global recognition and prestigious awards, including Musk’s Carbon XPRIZE Grand Prize Winner. The company also won the Cleantech 100 Hall of Fame Company and the 2022 CNBC Disruptor 50 List Company awards.
Further acknowledging its decarbonization efforts, Citi served as a financial advisor to CarbonCure during this latest round.
With its innovative technology, the carbon removal company is enabling the concrete sector to use captured CO2 to make low-carbon concrete mixes. This is crucial for the sector to stay competitive as stakeholders demand greener building materials to mitigate climate change.
When discussing the reduction of global carbon emissions, the focus often falls on heavy-emitting sectors, with glass-making frequently overlooked. However, the manufacturing of glass contributes approximately 86 million tonnes of carbon each year. A new type of glass, however, could halve these emissions and is ten times more resistant to damage.
Researchers at Pennsylvania State University have created LionGlass, a glass that’s much stronger and has lower emissions than conventional glass. The researchers had requested for patent approval as the first step in bringing the new glass to market.
A New Approach to Glass Manufacturing with Lower Emissions
The glass industry is well-established, yet it is capital- and energy-intensive, heavily reliant on durable raw materials. Glass is a ubiquitous material, found in everyday items ranging from smartphones to cars, but its production requires extremely high temperatures.
The primary components used in glass production are quartz sand, soda ash, and limestone. The melting of soda ash and limestone releases CO2, a significant contributor to climate change. Limestone, in particular, is a major reason why the cement industry emits large amounts of carbon.
Glass production is both sand and energy-intensive. It contributes around 86 milliontonnes of CO2 annually, a significant contribution to global warming.
For context, consider the energy use and carbon emissions of a glass bottle compared to other materials like cans and plastic.
Source: Han et al., (2020).
The majority of these emissions come from the energy required to heat furnaces to the high temperatures needed to melt glass.
A research team at Penn State University has introduced a new glass product that is 10 times more resistant to damage and emits about half the CO2 of the current manufacturing process using soda lime.
The lead researcher and professor at the University highlighted the importance of their discovery in making glass production sustainable, stating:
“During the glass melting process, the carbonates decompose into oxides and produce carbon dioxide, which gets released into the atmosphere… Our goal is to make glass manufacturing sustainable for the long term. LionGlass eliminates the use of carbon containing batch materials and significantly lowers the melting temperature of glass.”
With LionGlass, the melting temperatures are reduced to about 300°C to 400°C. This reduction decreases the amount of energy needed to process glass by about 30% compared to soda lime glass.
Thinner and Lighter, yet Unbreakable
The researchers also noted that they can reduce the glass thickness without compromising its strength, making the new product lighter than conventional glass.
This is even more environmentally friendly because less material means less energy is required to process and transport the glass.
Surprisingly, scientists discovered that LionGlass has much higher damage resistance, ten times more than soda lime glass. It can resist cracks even under a 1-kilo-force load of a diamond indenter machine. In comparison, conventional glass can crack under just 0.1 kilo of force.
Resistance to damage or cracking is a crucial quality of glass to ensure its longevity. Glass that is resistant to forming micro-cracks is highly valuable.
LionGlass also comes in various compositions, each offering unique properties and uses. However, the team is still studying how the glass would react to different chemical environments. Their findings will help them better understand how their new discovery can be used worldwide.
Importantly, with improved performance, glass can help address not just environmental issues but also healthcare and urban development. The team aims to make a significant contribution to these areas.
The U.S. glass industry is a global leader in glass production and technology. Many valuable industries rely on glass for various products, including solar equipment, vehicle parts, building materials, consumer electronics, and semiconductor devices.
LionGlass’ Potential Industrial Applications
Given the impressive properties of the new glass, it offers a wide range of potential uses across industries.
For example, it could improve the efficiency of solar panels, which use a sheet of glass to protect their inner components against harsh elements. Lighter panels could lead to lower solar installation costs.
Car manufacturers could use LionGlass to create unbreakable glass roofs using lighter but stronger materials. This could reduce the cost of manufacturing electric vehicles as well as consumer devices made with glass.
This breakthrough is remarkable because it signifies the glass industry’s participation in the global race to reduce carbon emissions. New scientific discoveries can improve products and make them in a way that’s less damaging to the Earth. Lighter but stronger glass with reduced emissions is one such innovation.
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