CTC #82 - Canadians make XPRIZE Carbon Removal finals

Hey there,

Welcome to this week’s issue of Climate Tech Canada, where we break down the latest in climate tech.

ICYMI - our latest podcast episode is out, featuring Lite-1 co-founders Roya Aghighi and Sarah Graham! They’re on a mission to transform the colour industry with sustainable dyes grown from microbes. It was a great conversation diving into sustainability in fashion, biomanufacturing, and building a hardtech company in Canada.

🎧 Listen on Apple Podcasts, Spotify or wherever you listen to podcasts.

This week in climate tech:

• The three Canadian startups in the XPRIZE Carbon Removal finals

• Shell’s “phantom” carbon capture credits

• Eavor secures €45 million loan for commercial geothermal

Let’s go!

🏅 Three Canadian startups make XPRIZE finals

Three Canadian climate tech startups are finalists for the $50M XPRIZE Carbon Removal competition. The finalists were picked for their performance in operations, sustainability and cost.

The XPRIZE Carbon Removal competition is a four-year long competition backed by the Musk Foundation to develop solutions that can capture and sequester CO2. Over 1,300 teams have participated across four tracks for different capture methods: air, ocean, land and rocks. 

Here’s a look at the Canadian finalists:

🌊 Planetary Technologies: Planetary enhances the ocean’s natural ability to absorb carbon from the air through ocean alkalinity enhancement (OAE). The process adds antacids to seawater which neutralizes acidity. This creates a deficit of CO2 in surface water, allowing more CO2 to be absorbed and speeding up the ocean’s natural carbon cycle.

💨 Skyrenu: Skyrenu is developing a system that combines direct air capture with a rock carbonation process that treats tailings from asbestos mines and locks away carbon. Their modular systems can be installed directly at carbon sequestration sites, avoiding the need to transport CO2. 

🪨 Arca: Arca’s solution accelerates carbon mineralization (where CO2 reacts with minerals, becoming permanently trapped) in mine tailings and waste rock. Arca is essentially turning mine waste into a massive carbon sink.

Why it matters: removing carbon is a key component to hitting our climate targets. According to the IPCC, we need ~10 gigatonnes of CO2 removed per year by 2050. But the technology is still early, often operating at a small scale and with a high price per tonne removed. Efforts like XPRIZE help the industry move forward by providing funding for new methods and supporting technologies with the potential to scale.

What’s next: The 20 finalists will now have to demonstrate that they can remove 1,000 net tonnes of CO2 in the final year of the contest. Solutions will also be judged on their potential to scale to megatonne-level capture in the short term and gigaton-level by 2050. The winner will receive $50M and $30M will be distributed to the three runners up.

💰 Climate capital

🌋 Eavor secured a €45 million loan for a geothermal heating project in Germany from the European Investment Bank and EU Innovation Fund. Eavor is building out its first commercial-scale project using its closed loop geothermal tech.

💵 Climate-focused investment manager Power Sustainable announced a strategic partnership with Great-West Lifeco. Great-West becomes a minority shareholder, and will invest in funds across the portfolio. Power Sustainable has $3.8B in assets under management to catalyze investment in clean solutions.

📈 Milestones & Product

💨 Deep Sky will develop its first carbon capture site in Alberta to leverage existing seismic mapping and regulatory frameworks for storing CO2. Later phases are planned for Quebec.

🔋 E3 Lithium will expand its lab operations to manufacture battery products like lithium carbonate in addition to its direct lithium extraction technologies.

☀️ uOttawa researchers found that adding reflectors on the ground under solar arrays could boost energy output by as much as 4.5%.

🚌 BC Transit will purchase 66 battery electric buses, with half coming from Winnipeg’s New Flyer and the rest from Quebec-based Nova Bus.

👩🏻‍🔬 The New Brunswick Innovation Foundation backed four climate research projects across vehicle-to-grid readiness, assessing carbon storage in wetlands, and monitoring agricultural emissions.

🪙 Carbon capture two-fer

Shell is under fire from environmental groups for selling credits under a two-for-one carbon credit deal with the Alberta government. The agreement gave Shell two tonnes worth of credits for each tonne it actually captured and stored at its Quest carbon capture utilization and storage (CCUS) project. 

Greenpeace described the resulting credits as “phantom credits” because half of the value wasn’t tied to actual emissions reductions. 

In context: Alberta runs an industrial carbon pricing and emissions trading system for large industrial emitters. Emitters have an allotted amount of emissions they can produce. If they exceed that limit, they can either pay the carbon price to the government or buy credits to offset those emissions. 

While the credits generated weren’t directly tied to emissions reductions, the Alberta government defended the deal as a way to incentivize CCUS investments and develop the technology. 

The bottom line: The question comes down to policy choices around how governments should incentivize new technologies like CCUS while making sure emissions are actually reduced. Subsidies like the carbon credit deal are one tactic to improve the economics of projects, but could undermine the efficacy of carbon pricing. Other approaches like increasing the price of carbon in Alberta’s market could also encourage investment by making carbon capture more economical than paying to emit. 

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🗞️ In the news

🏛️ Greenwashing?: Lululemon is being investigated by Canada’s Competition Bureau for their climate claims. Environmental groups claim the athleisure company is misleading customers about its climate impact. The company has used slogans like “Be Planet” while emissions doubled.

🌳 New forest management protocol: Canada has a new protocol for generating forestry-based carbon credits on private land. The protocol focuses on efforts that go beyond business as usual to increase the amount of carbon stored and allows stakeholders to earn credits under Canada’s Greenhouse Gas Offset Credit System. Other frameworks for direct air capture, soil, and methane from agriculture in the works. 

🏡 Heat pumps: The federal and B.C. governments announced more than $250M to help people with low- and middle-incomes in B.C. switch to low-carbon heating and cooling options. British Columbians can get grants to ditch oil, propane or natural gas systems. Depending on the extend of upgrades, applicants could receive up to$24,000 to cover the upgrades.

🌎 Big picture

Renewables generated a record 30% of global electricity last year, with fossil fuel generation expected to drop 2% this year.

Chinese EV maker Zeekr went public on the NYSE - an important test for IPO appetite and confidence in climate tech.

The UK cancelled its third pilot to use hydrogen for household heating.

Nuclear had a big week with multiple green lights from regulators and two IPOs from advanced nuclear startups

The world’s largest direct air capture plant came online last week.

The DOE’s wishlist for AI-enabled clean energy.

📣 What’s going on

🗓️ Toronto Happy Hour with Clean Creatives: Join Clean Creatives for their first Toronto meetup in 2024 to meet other people from creative agencies working on climate solutions. May 15th, Toronto.

🗓️ Climate Careers & Community: Join the Montreal climate community to meet others who are passionate about climate solutions or explore new career paths. May 21st, Montreal.

🗓️ C2 Montreal: Bringing together business leaders, entrepreneurs, innovators and creatives, this conference features a day dedicated to sustainable innovation. May 22nd, Montreal.

🗓️ Climate North - Rolling Towards Sustainability: exploring the world of micro-mobility and its impact on climate change and society. May 22nd, Toronto.

🗓️ What could an Ottawa Climate Week look like?: Join the Climate Leap crew as we debrief on SF Climate Week and explore what we’d want to see from an Ottawa Climate Week. May 30th, Ottawa.

📌 Jobs

Check out the job board for newly posted roles from Canadian climate tech companies working on building retrofits, hydrogen energy, low-carbon concrete and more!

➡️ Hiring? List your posting here.

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Thanks for reading,

Justin

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