Can carbon capture startup Carbon Clean deliver on its cost claims?

Startup Carbon Clean announced earlier this week that it raised $150 million in a Series C that provides it with a sizable war chest to continue the development of its modular carbon capture system.

Update: This article has been updated to reflect which industries Carbon Cure’s cost forecasts include.

Carbon Clean has won its share of admirers, most recently Chevron, which led the round, and BloombergNEF, which named it a BNEF Pioneer last month in part because of the startup’s small-scale approach to carbon capture and sequestration (CCS). 

Typically, the technology is a large-scale affair. After all, the world needs to eliminate emissions on a vast scale, and the technology benefits from a certain amount of scale. That’s why CCS is usually envisioned attached to massive coal- or gas-fired power plants. 

But there are still many smaller sites, from cement kilns to chemical plants, that are currently wedded to fossil fuels but still need to be decarbonized. These are the sorts of companies that Carbon Clean pitches itself to, and the startup says that its modular approach can help polluters deal with their carbon emissions incrementally as regulations ratchet up.

Fundamentally, Carbon Clean relies on a tried-and-true process to strip carbon dioxide from exhaust streams. Exhaust containing carbon dioxide is sent through a filter that is wetted with an amine-based solvent. At lower temperatures (around 50 degrees Celsius, or 122 degrees Fahrenheit), carbon dioxide will bind to the amines. The CO₂-laden solvent is then pumped to another container, where it’s heated to 110 to 120 degrees C (230 to 248 degrees F) to release the gas, which is then compressed and sent elsewhere to be used or stored. Each company has its own amine solvent with different properties, and the details of the process may vary, but that’s the gist of it.

Carbon Clean CEO Aniruddha Sharma said his company’s amine solvents can reduce costs compared with a commonly used amine by requiring less energy to heat and by reducing corrosion in the system. Until the company releases more data, such claims will be hard to judge. But based on the general type of amine it’s using, Carbon Clean is likely to see at least a small improvement in energy use.

Sharma said that by coupling the proprietary amine solvent with mass-produced modular units, his company can bring carbon capture costs down to $30 per metric ton by 2025. (Update: Carbon Clean confirmed for TechCrunch that that figure would be an average across all industries and that it was derived by “a cost analysis undertaken by an independent third party.”) If that’s an average across all industries the company is targeting, it would be an impressive achievement. (Carbon Clean wouldn’t confirm.) CCS costs vary widely, but in many cases, they’re higher: Steel mills, for example, may capture carbon anywhere between $8 and $133 per metric ton, ammonia plants might do it at $22 to $32 per metric ton and cement kilns between $19 and $205 per metric ton. 

The U.S. government provides tax credits for CCS, which today are $24 or $36 per metric ton, respectively depending on whether it’s used to make oil fields more productive or simply stored below ground. By 2026, those numbers will rise to $35 and $50 per metric ton — and even higher if pending legislation is passed. If Carbon Clean can deliver on its promises, then CCS would no longer cost companies money, but become a potential profit center.

Based on data released by Carbon Clean, its carbon capture costs aren’t bad, but they’re also not below the norm. “[C]ommercial references such as Tuticorin Alkali Chemicals and Fertilizers Limited (TFL) have proven commercially viable operations with a consistent cost of $40 per metric tonne of CO₂ captured,” the company said on its website, a figure that Sharma confirmed for TechCrunch. That’s a decent number, but not quite a breakthrough — according to the International Energy Agency, fertilizer plants were capturing carbon dioxide at a cost of $25 to $35 per metric ton in 2019.

Of course, that figure may drop as the company begins to mass produce its modular CCS equipment. Carbon Clean’s CycloneCC units can fit in the space of a shipping container, making transportation and installation relatively easy. Sharma also said that the rotating discs at the heart of Carbon Clean’s units have “exactly the same amount of power and efficiency as 35 meter tall towers” used at Petra Nova, what was once the world’s largest commercial CCS facility.

Many CCS installations like Petra Nova are large, bespoke efforts, which are, of course, expensive. Yet that same scale can also bring down the cost per metric ton. For example, a big installation only needs one sizable pipe to transport the CO₂ for use or storage, which is cheaper than building dozens of small ones or operating a fleet of trucks. In other words, what might be lost due to a lack of modularity can probably be offset by other economies of scale.

Carbon Clean appears to be occupying the other side of that equation. Its customers will have to figure out what to do with the carbon once captured, but they’ll at least benefit from efficiencies wrought by mass production. Whether Carbon Clean can hit its $30 per metric ton target across a range of diverse industries remains to be seen. Yet even if it doesn’t, the company may still have an opening. 

“Most of my customers, if you go to our cement site or industrial site or a chemical plant and you say, ‘Who’s your decarbonization team?’ They say, ‘Well, [our] energy efficiency manager,’” Sharma said. “OK, so you’ve got one guy responsible for selecting the strategy, selecting the technology, selecting the [engineering, procurement and construction company], building it and ensuring someone who works with the board to raise the finance then operating it as well liaising with the government? Not going to happen.” 

Part of Carbon Clean’s pitch is its simplicity, Sharma said. “We’ll bring the technology, we have partnerships with [engineering, procurement and construction companies] … and then we will operate it over a period of time.”

If regulators start to pressure smaller operations to reduce their carbon emissions, then a set-it-and-forget-it approach may find buyers, even if it’s at a slightly higher price.