Three Lessons Carbon Removal Can Learn from the Low Carbon Energy Investor Forum

Summary:

  • The state of carbon removal technologies in investment today is akin to the beginnings of other now well-known mitigation technologies like solar, wind, and energy efficiency.

  • Scaled demonstration projects, industry and policy support, and an open dialogue on the potential for carbon removal technologies is imperative to preventing climate change

 

Kicking off the Low Carbon Energy Investor Forum in San Francisco, Ira Ehrenpreis from DBL Technology Partners opened with a promise of innovation from Henry Ford: “If I had asked people what they wanted, they would have said faster horses.” Similarly, solving the climate problem requires that we start thinking about more solutions than the “faster horses” we have today.  One such path-bending innovation is the idea of removing carbon from the atmosphere on large scales. This idea may seem as futuristic today as the automobile did in the 1879, but carbon removal likely will play a large role in preventing the adverse effects of climate change in the near future.

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On May 19-20, 2015, the Low Carbon Energy Investor Forum convened in San Francisco to discuss how institutional investors were accessing a wide range of low carbon energy investments. The conference emphasized the numerous opportunities today for investors to enable the to transition to a cleaner, lower carbon economy through projects with market rates of return. While the conference kept largely to discussions of traditional mitigation techniques (e.g. wind, solar, energy efficiency), there are a number of meaningful lessons for carbon removal technologies to be learned from traditional mitigation options.  

1.  Carbon removal projects need to learn to scale without carbon pricing.

According to data from Bloomberg New Energy Finance, global cleantech investments grew by 16% to $310 billion in 2014. This extreme growth shows that low carbon projects can stand on their own two feet, becoming mainstream investment options with strong business cases without any internalization of environmental values.

2. Decades of industry and policy support have been critical to the proliferation of renewable and energy efficiency technologies.

This proliferation of clean energy investments did not develop overnight. Traditional mitigation techniques, like renewable energy and energy efficiency, have had decades of regulatory support and technology development to get to this point.  Since panelists at the conference stressed the importance of safer, later stage technologies, it is no surprise that there is a lack of investment in the carbon removal field that simply isn’t developed enough to warrant this later stage investment. For example, Daniel Matross and Mike Carr, from U.S. DOE and the Consulate of Canada respectively, both mentioned the potential for bio-CCS to be an important medium term play of a larger portfolio approach in the fight against climate change, but that demonstration projects were critical before investors would be willing to scale these types of investments.


3. We need more dialogue on carbon removal.

It will take more conversations about the potential for negative emission technologies to create the funding in research and development necessary to make carbon removal a serious player in the investment sector. The relative lack of discussion on carbon removal technologies at the Low Carbon Energy Investor Forum in comparison to other GHG mitigation techniques was representative of the field as a whole. The transition to a low carbon or carbon neutral energy system will be lengthy, implying that carbon removal will only grow in importance in carbon removal can aid in achieving this by removing legacy emissions from the atmosphere. So what to do? Discussions, development, and deployment of carbon removal begin now.