Svante lands $137M to scale carbon capture

TECH

Svante lands $137M to take on first-of-a-kind projects

What happened: Svante closed $137 million from the Canada Growth Fund to cross the first-of-a-kind chasm. The capital enables Svante to take equity stakes in carbon capture projects as a co-developer. 

Svante develops carbon capture technology for industrial emissions, capturing CO2 from vents and exhaust systems at steel mills, bioenergy plants, and pulp and paper mills. 

The tech: Svante’s system uses filters made of metal-organic frameworks that capture CO2 from the air while allowing other molecules to pass through. These solid filters are more energy efficient, easier to handle, and lower cost than the typical wet, solvent filters used in carbon capture.

The company has four pilot plants across North America and is building a new facility that will be able to produce enough filters to capture 10 million tonnes of CO2 annually. In addition to manufacturing the filters, Svante also has an in-house services business for project development.

Crossing the chasm: Expanding into project financing sets the company up to accelerate first-of-a-kind projects that often struggle to secure financing. 

First-of-a-kind projects are critical for technologies to move from pilot to commercial stages. But they’re also capital intensive - carbon capture projects in the oil sands regularly have multi-billion dollar price tags.

VC funding often isn’t a fit due to the amount of equity a startup would give up and the level of commitment to a single portfolio company. On the other hand, the technology risk is still significant enough that typical project finance and banks won’t participate. 

Why it matters: Investing in projects enables Svante to distribute the financial risks of the project and make it more appealing for traditional financing to participate. At the same time, Svante gets to participate in the financial returns on projects while also tapping into the learnings and expertise of the project team.

What’s next: The first $69 million tranche from CGF will be used to accelerate and de-risk projects already underway. The remainder can be tapped into for developing future carbon capture projects with a focus on Canadian projects.

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Book a free 15 minute consultation here to learn more.

CLIMATE CAPITAL

🪨 Arca Climate Technologies secured an investment from InBC, B.C.’s strategic investment fund, for an undisclosed amount. Arca is developing carbon removal technology using mineralization, locking up CO2 from the atmosphere in rocks for permanent storage.

⚛️ Aalo Atomics raised $27 million in Series A funding for their small nuclear reactors gigafactories. Based in Austin, TX, Aalo was started by Canadian and former Humi co-founder Matt Loszak. Aalo aims to drive down the cost and timelines for small modular nuclear reactors.

⚒️ E3 Lithium closed $5 million from Emissions Reduction Alberta for their lithium extraction tech. E3 extracts lithium from industrial brines produced by the fossil fuel industry, turning waste into resources. The funding will be used to demonstrate E3’s extraction tech and a closed-loop water recycling system.

🔋 Nano One received $2.8 million from industry group Next Generation Manufacturing Canada (NGen) to commercialize their cathode active materials production technology. 

🔋 Green Graphite Technologies also secured funding from NGen to recycle graphite for lithium-ion batteries, while Ionomr Innovations received funding to develop high-performance fuel cells. 

💧 Next Hydrogen received a $2 million repayable investment from the feds to develop new manufacturing processes for its green hydrogen electrolyzer modules.

NEWS

In it to win it

Canada needs to take a more strategic approach to building out its battery value chain if it wants to compete, according to a new report from Accelerate, Canada’s zero-emissions vehicle alliance.

What happened: The alliance released the Canadian Battery Innovation Roadmap, a strategy to establish Canada as a global leader in battery technology by 2035.

The roadmap sets five major targets for Canada to increase its competitiveness, including a $3 billion investment in battery innovation, training 10,000 skilled professionals, and securing 1,000 battery technology patents. The recommendations focus on ramping up innovation infrastructure like public and private investment, R&D centres, and skilled workers, and industrial policy that will take a more targeted approach to growing startups, building IP and keeping companies in Canada.

What's the context: Canada has a history of battery innovation dating back to the 70s, but only recently has started to ramp back up. Since 2019, Canada has catalyzed over $46 billion in battery value chain investments and ranked #2 in value chain potential by Bloomberg.

Not so simple: Canada isn’t alone in its battery ambitions. China, the US, Japan, Korea and the European Union all want a piece of the market and have set goals to capture both domestic and global demand. 

The bottom line: The report is a welcome addition to the conversation around Canada’s emerging battery industry. It adds a helpful look back at Canada’s history and a look forward to best practices from around the world. A shift away from ad-hoc funding, hyper-focus on foreign direct investment, and tying our battery efforts to specific targets could help create more leverage for the industry.

IN THE NEWS

🔥 Up in smoke: The wildfires that blanketed the country last year produced as much greenhouse gas emissions as 10 years of wildfires under normal conditions. Those fires were 3x as likely because of climate change and contributed ¼ of global wildfire emissions. Wildfires are a growing risk to human life but are also making climate change worse by contributing more CO2. Wildfires emitted 8.6 gigatonnes last year, more than all US emissions combined. 

🛢️ Hydrogen storage potential: Salt caverns deep below Newfoundland’s west coast could be a key piece of Canada’s green hydrogen ambitions. Companies are exploring underground salt formations that can be dissolved and hollowed out, creating caverns to store millions of tonnes of hydrogen. These formations have been used for decades to storage fossil fuels with more than 100 in use in Alberta. Repurposing these naturally-occurring formations could unlock huge amounts of low-cost, high-capacity storage for clean hydrogen located near several wind-to-hydrogen projects being developed in Atlantic Canada. Meanwhile, a study found that Canada could be one of the best regions in the world for green hydrogen production.

🔬 Bioproducts boost: The federal government announced close to $6.6 million in funding for Bioindustrial Innovation Canada (BIC) to support a bioproducts innovation cluster. The cluster focused on developing technology to turn renewable resources like agricultural waste into useful bioenergy, biofuels, and biomaterials like ethanol and biodegradable plastics. Elsewhere on the R&D front, UBC received $3.8 million to establish a Food and Beverage Innovation Centre focusing on packaging, processing and innovative products.

🔧 Heat pump skills: The feds are aiming to close an important gap in driving heat pump adoption. The Heating, Refrigeration and Air Conditioning Institute of Canada will receive $500K to address heat pump proficiency in the HVAC workforce. The institute will benchmark current heat pump skills and knowledge in the workforce and then build college training programs to close the gaps. Better awareness and proficiency with heat pumps can help shift the thousands of conversations HVAC technicians are having with homeowners - often a make or break factor in deciding to switch.

BIG PICTURE

For battery makers, an EV slowdown is being offset by a boom in energy storage.

A major shift: the US plans to back a global treaty calling for a reduction in plastic production.

Egypt launched the first carbon market in Africa to support climate-positive investments.

US emissions could drop 34% by 2030 according to a Princeton-led project. It’s significant, but short of Biden’s 50% target. Thread-ified version of the report here.

The pace of global warming could be slowing as government policies start to take effect.

In a boost for human health and the climate, India is testing 109 high-yielding, climate-resilient seed varieties.

What if you could retrofit an apartment building without disrupting tenants?

Banks are way off course on climate, with zero or weak targets and portfolios that don’t line up with 1.5C pathways

COMMUNITY

🗓️ Green for Green: Financial Models to Accelerate Impact. Hosted by Climate North, this event explores how our financial choices can accelerate the impactful economy. August 22nd in Toronto.

➡️ Discover more climate events.

💻️ Jouleia is hiring a Chief Operating Officer to build out their Home Expert Service. For more on Jouleia, check out our interview with co-founder Paul Sehr.

➡️ Find more open roles.

🚀 Invest Together in Climate Innovation. Hosted by Spring in partnership with RBC, this initiative prepares Canada's Top 15 climate ventures for capital raising while equipping 20-25 investors with the essentials of early-stage impact investing. Both cohorts will collaborate on investment evaluation, impact measurement, due diligence, and more, culminating in a pitch event offering a minimum $100,000 investment.

➡️ Founders apply by Aug 30th. Investors apply by Sept 27th.