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Three important things, plus one very unimportant thing

Hello from Dubai, where the United Nations’ annual climate conference — that is, COP28 — officially began today.
This was an enormous day for climate and environmental news around the world. Not only did COP28 begin with a surprising (and important) accomplishment, but the Environmental Protection Agency proposed cracking down on lead pipes, one of the biggest remaining sources of water pollution in the United States. Tesla is also set to release — and announce a price for — its gargantuan Cybertruck today, one of the most contentious electric vehicles launches in history.
So let’s get down to it.
1. COP28 officially began. This afternoon, the 28th Conference of the Parties to the United Nations Framework Convention on Climate Change — or COP28 — officially began. It will run here at Expo City at the southern end of Dubai until December 12.
It was not, technically, the only climate conference that started in Dubai today: Technically, three conferences kicked off. That is because since the world adopted the Framework Convention on Climate Change in 1992 — which is the big, arching UN treaty to do something about climate change— countries have stacked other agreements on top of it. So today was also the beginning of CMP18 (the 18th Meeting of the Parties to the Kyoto Protocol) and CMA5 (the fifth Meeting of the Parties to the Paris Agreement).
2. The conference launched the loss and damage fund. This was a welcome surprise. For years, countries have debated over “loss and damage” — essentially, what richer countries that are responsible for most global warming so far owe to poorer countries that are dealing with its consequences. Last year at the COP in Sharm el-Sheikh, Egypt, countries agreed to establish a loss and damage fund for the first time. They’ve been hammering out the details over the past year — at the insistence of the U.S. and Europe, the fund will be hosted first by the World Bank — and today the fund was officially launched, or in UN parlance, operationalized.
Germany, Japan, the United States, the United Kingdom, and the United Arab Emirates all gave money to the fund. The U.S. donated the second smallest amount, after Japan.
3. The World Meteorological Organization confirmed that 2023 will be the hottest year in human history. Since temperatures in July, August, and September destroyed all-time records, this sad milestone has been more or less expected. But today the World Meteorological Organization, a UN-associated weather body, confirmed that 2023 will be the hottest year ever measured.
Tomorrow, a subsection of COP — the World Climate Action Summit (!) — will begin. This is the part of COP where various world leaders come and speak to the negotiators.
This year sports a perhaps underwhelming set of world leaders. Neither President Joe Biden nor President Xi Jinping will be attending. The highest profile elected leaders will probably be President Luiz Inácio Lula da Silva of Brazil and Prime Minister Rishi Sunak of the United Kingdom. King Charles III is also coming.
Following this event, but also overlapping with it, will be a period with lots of big announcements. Investors will announce new projects and investments. Companies will announce new voluntary climate-action coalitions. Countries and cities will announce new coalitions of voluntary action. It will be fairly hard to tell which of these actually matter in the moment, but some of them probably will.
Then there will probably be a news lull for a few days. Finally, at the end of the conference, negotiators will hash out the details of this year’s joint statement.
Even though COP officially starts today, it was largely uneventful here in Dubai. No world leaders spoke; the only big news was the loss and damage fund. Many news articles heralded that COP has begun in Dubai!, without saying what, exactly, that means or how people are spending their time.
Let me decipher it for you. While COP is an international media spectacle, it’s also an enormous in-person conference — and it is subject to some irreducible geometric challenges. This year, those challenges exist on a new scale: With more than 80,000 people attending the Dubai proceedings, this is by far the largest COP ever. (For comparison, about 50,000 people attended the Paris COP in 2015, when the Paris Agreement was adopted.)
Here is what I mean: Today, everyone had to pick up their conference badges and lanyards. That is what happened at COP today. A small suburb’s worth of people — including me —waited in a line to go through security and show a chipper UN employee our registration papers and get our photo taken. The line was about 1.2 kilometers long (literally— I corroborated that with my Apple Health data) but it was run efficiently and cheerfully.
According to a forensic reconstruction of my activities, compiled chiefly from an Uber receipt and the timestamp on some iPhone photos, I arrived at the conference center at 12:25pm and had a name badge almost exactly two hours later. I began keeping a journal when I realized that I was unlikely to get to the front of the line any time soon.
12:25 p.m. I arrive at Expo 2020, the nearest dropoff to the conference center. A man with a UN badge tells me to join a line without providing any details. I decide to follow the late Soviet rule that if you see a long line, you should just get in it.
12:35 p.m. A quasi-status system immediately makes itself clear. Some people have green lanyards, which entitle them to enter the Green Zone, the “trade show” part of the COP, which is governed by the U.A.E. Others have blue lanyards, which let them the Blue Zone, the official UN part of the conference.
1:14 p.m. We are handed aluminum Aquafina cans, a thoughtful gesture. Many of the people near me in line seem to be in their 50s and 60s, and the subtropical sun is hot and unrelenting. They must be starting to lose it out here.
1:18 p.m. Studying the can, I notice it is labeled “Still Drinking Water.” I find the “still” to be ontologically reassuring. It is good to know that this is still drinking water. Thank goodness I am not losing it like all these middle-aged people around me.
1:35 p.m. A 30-something man in line is wearing a t-shirt with the words “Dinosaur Facts” on it. Highlight of my COP so far.
1:46 p.m. I dimly realize that Sydney, Australia, (where it is 8:46pm) is closer to Dubai time than New York is.
1:51p.m. It strikes me that COP and Disney World are plagued by the same problem: very long lines. But if this were Disney World, we would have encountered several entertaining animatronics by now.
2:19 p.m. I finally reach through security and waiting in the final room: to receive my pass. As soon as I get through, I realize I have been silently standing in line next to a very famous environmental justice academic for an hour. With that opportunity already squandered, my COP begins.
Read Robinson Meyer’s last dispatch from COP28:
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Current conditions: The powerful earthquake that killed at least 61 people in the Philippines last week raised the seabed by as much as 7 feet • Raja Ampat, the archipelago off Indonesia’s Southwest Papua province, is enduring days of intense thunderstorms • The Gulf Coast of Texas is bracing for what could become a tropical cyclone set to dump heavy rain across the region.

On Tuesday, the Financial Times reported that ConocoPhillips was on the brink of announcing a deal to become the first U.S. oil company to reenter Syria since President Ahmed al-Sharaa officially took office last year. The deal, expected to be formalized this week, would be a sign of regrowth after 14 years of brutal civil war that finally ended with the surrender of longtime president and de facto dictator Bashar al-Assad. The Syrian government said last year that a potential deal could increase output of gas by up to 5 million cubic meters per day within a year, a major leap toward restoring an industry that once produced a prewar high of 30 million cubic meters per day in 2011.
When Frontier launched in 2022 as a vehicle for those who want to fund carbon removal from the atmosphere, there were barely a dozen companies working to crack the technology. Now there are hundreds of startups taking nearly two dozen different approaches. And Frontier is pulling in more money to spread among them. The company said Wednesday that its buyers committed $915 million to invest in carbon removal companies. Anthropic, one of the leading developers of artificial intelligence models, is among the new buyers. Neither Anthropic nor OpenAI, Anthropic’s peer and rival, has made any kind of public climate-related commitment, making the AI giant’s entry into the group particularly notable.
It’s a sign, perhaps, that the old way of thinking about corporate climate actions — a single-minded focus on carbon accounting — is giving way to more substantive solutions.
As Heatmap’s Emily Pontecorvo put it this week, a growing chorus of experts says that carbon accounting is “not just inadequate, but actively harmful to bringing about the systems-level change required to decarbonize the economy.”
The Department of Justice has officially weighed in to defend Elon Musk’s artificial intelligence startup against a lawsuit in which the NAACP accused the company of building its Colossus Gas Plant in mostly Black neighborhoods between Tennessee and Mississippi. In court papers filed Monday and covered by E&E News and Wired, the Justice Department said the civil rights group’s litigation threatened the U.S. military’s ability to “meet its national security mission and keep pace with adversaries” using xAI’s Grok chatbot. Grok’s ability to operate “is a matter of paramount national security” because it is one of only four cutting-edge AI models that can support national security applications, and one of just three suitable for “mission-critical operations across Secret and Top-Secret classified networks,” the agency told U.S. District Judge Debra Brown, who is presiding over the lawsuit in federal court in Mississippi.
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Regular readers of this newsletter know that I like to cover the major steps in any reactor’s construction, but especially those in China. When I think back to previous newsletters and the specific updates in them, I struggle to pinpoint exactly when I wrote what, given how frequently the basic facts of the stories repeat themselves. The effect of this, I hope, is to leave you with the accurate impression that China is building a lot of reactors very quickly and efficiently — and to give you pause about how seldom you hear about similar milestones coming out of any other countries. Well, in that spirit, here’s the latest. On Monday, World Nuclear News reported that China General Nuclear Power, the country’s biggest state-owned reactor firm, just lifted the outer dome into place at its fifth reactor at the Ningde Nuclear Power Plant in Fujian province. The 270-metric-ton dome will cap off the containment vessel for the latest Hualong One, China’s flagship reactor with a domestic design.
Last month, Hawaii passed a law that slashed tax credits for both utility-scale and residential solar projects, limiting the amount available each year until a phase-out in 2030. Those changes were set to apply retroactively to projects built in 2026. But Governor Josh Green, a Democrat, just signed an executive order preserving the solar tax credit throughout the end of the year. “Distributed solar energy has been, and will continue to be, a leading contributor to the state’s sustainability and resiliency goals,” the executive order states, according to KHON-2, a local TV station.
Tesla is expanding its VPP efforts. The company said Tuesday that its Powerwall battery leasing program would now include a built-in participation in a virtual power plant. That’s without any additional enrollment or management by the customer. The pilot is rolling out first in Massachusetts and Connecticut.
Rob talks with Hannah Bebbington Valori, head of Frontier Climate, about the group’s new $915 million fund.
One of the most interesting projects in carbon removal is doubling down on the industry. Frontier — a coalition of tech, finance, and fashion firms that buy carbon removal credits to support the crucial technology — has secured another $915 million to power its next round of buying. The artificial intelligence giant Anthropic has also joined the coalition alongside its existing members, including Stripe, Google, JPMorganChase, and others.
On this episode of Shift Key, Rob is joined by Hannah Bebbington Valori, who leads Frontier. They discuss the health of the carbon removal industry after a tough few years, how Frontier is changing its buying strategy for its newest round, and why Anthropic entered the coalition.
Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap News.
Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, or wherever you get your podcasts.
You can also add the show’s RSS feed to your podcast app to follow us directly.
Here is an excerpt from their conversation:
Robinson Meyer: I do think there are people who are going to see Anthropic join and say, Anthropic, complicated company. Because on the one hand, I think it’s been the most ... if there’s any company, I think, that’s kind of pledged most among the frontier AI labs to uphold, let’s say, liberal democratic values, I think Anthropic obviously has to be top of the list. At the same time, they’ve partnered with xAI. They seem to be using a lot of compute at this Colossus Data Center, which is particularly carbon intensive in Tennessee. I think there are people who say carbon removal is kind of a delayist technology. It allows companies to keep emitting fossil fuels, to keep burning carbon and kind of promising to clean it up later, but not doing anything to reduce emissions in the near term. And Anthropic would be a great maybe example of this. What would be your response to that?
Hannah Bebbington Valori: Well, I think my response to that would be a couple of things. One is the moral hazard around carbon removal has really not come to fruition. This concept that companies buy carbon removal as kind of a way to get out of corporate climate commitments or other climate activity is like really not borne out in the data for a couple of reasons. One, the people who care about carbon removal are the people who care about the climate, and so those folks are often building broader programs that include carbon removal and other things.
Two, these are all voluntary activities today, and I think — they’re very, very expensive ones at that. Buying carbon removal today costs hundreds of dollars a ton. If you wanted a sort of get out of jail free card, Frontier and carbon removal is not that. There are many other ways to have a climate program or maybe have a broader sort of civic responsibility program that are much cheaper than what we do.
And I think this is borne out sort of generally in the data, like how much money we spend on carbon removal versus how much money we spend on decarbonization efforts, rightly so, is a fraction. And so the world as it stands is not replacing carbon removal with other decarbonization activities. Rather, buying carbon removal today is recognizing that this market will not turn on like a light switch in 2050 when we want it if we don’t invest today. And so folks who buy carbon removal now are really sort of playing that long game thinking into the future about what we want to exist and investing today to make that happen.
And then, you know, the other way to answer this question is like we should hold folks’ feet to the fire on this. So people who buy carbon removal ... Honestly, people who don’t buy carbon removal should be thinking about decarbonizing their emissions.
Meyer: Where is OpenAI? They should be a Frontier …
Bebbington Valori: Totally. You can call them and tell them that. We should be banging on the doors of these companies and many other companies to be asking them, what are you doing to decarbonize? And that is not just Anthropic. That is everyone.
You can find a full transcript of the episode here.
Mentioned:
AI IPOs Could Create a Wave of New Funding for Climate Tech
Rob’s most recent story on carbon removal: Carbon Removal After Microsoft
Rob’s original story about Frontier: We’ve Never Seen a Carbon-Removal Plan Like This Before
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Music for Shift Key is by Adam Kromelow.
This transcript has been automatically generated.
Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, or wherever you get your podcasts.
You can also add the show’s RSS feed to your podcast app to follow us directly.
Robinson Meyer:
Hello, it is Wednesday, June 17, and one of the most interesting experiments in carbon removal announced a big new project this morning. Frontier is a coalition of tech, finance, and fashion companies that provides what’s called an Advanced Market Commitment, or AMC, for carbon removal. It is a very interesting format. It commits to buy carbon removal credits from companies that are still building out their infrastructure, working on their technology, in order to make sure that carbon removal will exist in the future. It’s like a private version of Operation Warp Speed just for carbon removal. Its members include a lot of firms you’ve heard of, Stripe, Google, McKinsey, H&M, JPMorgan Chase, Salesforce, and others. Well, as of this morning, Frontier has raised a new round of more than $900 million to go into the market and keep supporting carbon removal that effectively doubles the amount of money it has on hand. It calls this new round a growth advanced market commitment or growth AMC, but it’s an invented term, but it says it will focus its next stage of buying on just a handful of companies who it thinks have the potential to remove billions of tons of carbon from the atmosphere. And there’s other news too. The AI lab Anthropic, who we haven’t seen a lot of climate commitments from, has now joined Frontier as well, joining Google and Shopify and all those other firms I just listed.
Robinson Meyer:
Now, Frontier, some of you may remember, launched back in 2022. I wrote about them at the time for The Atlantic. At the time, there weren’t a lot of sources of demand for carbon removal. And so when they committed about a billion dollars to do it, it was a big deal. They’ve since used that money to buy just under 2 million tons of carbon removal credits. Since then, as we’ve also covered at Heatmap, a whale in the market has come and gone. I reported earlier this year that Microsoft, which is the world’s largest historic buyer of carbon removal, they bought about 70 million tons of it, paused its purchases. Which is a big deal for the industry. It cuts off the primary source of demand, the primary customer for future carbon removal. So Frontier re-upping at this moment is a really big deal. To discuss that news and more, I’m excited to welcome the head of Frontier, Hannah Bebbington Valori. She was on Frontier’s founding team and joins us from the United Kingdom. We talk about this announcement, the future of carbon removal technology, and how to interpret Anthropic’s membership in the coalition, always a company people want to hear about. I’m Robinson Meyer, the founding executive editor of Heatmap News, and it’s all coming up on Shift Key. Hannah Bebbington Valori, welcome to Shift Key.
Hannah Bebbington Valori:
Ah, thanks for having me.
Robinson Meyer:
So... Today, this morning, Frontier announced a new $900 million raise. Can you just start off by telling us what you’re going to do with it?
Hannah Bebbington Valori:
Yeah. So today we launched what we’re calling the Frontier Growth AMC, which is an additional $900 million committed to bicarbon removal between now and 2040. So the buyers in this AMC are Stripe, Google, Shopify, Salesforce, H&M, and Anthropic. And this funding takes us to about $1.8 billion total committed across both of our AMCs. And I think what is important to note about this is really the question on everyone’s mind in carbon removal today is, is demand going to keep pace with the technology development? And even more than that, is demand going to scale to what the market needs to stabilize global temperatures or sort of gigaton scale, hundreds of billions of dollars a year?
Hannah Bebbington Valori:
So this growth AMC is really designed to, in part, answer that question and bring corporate buyers to market to keep buying carbon removal at scale and at pace. We’re going to, on the supply side, focus on a narrower set of portfolio companies, those who are highest potential, most promising, and sort of ideally get them to commercial scale. And then perhaps even more unique is really on the demand side, we’re thinking about prioritizing projects that have line of sight to robust long-term government-driven demand. So thinking about how do we as corporate buyers use what is still sort of a relatively small amount of money to really catalyze this space and pull forward that policy that is required to get the market to gigaton scale.
Robinson Meyer:
It sounds like as you go through these projects and technologies that you have some candidates already in mind. Are like the companies that will benefit from this purchase already kind of lined up and in the system? Or is this still open to other carbon removal companies?
Hannah Bebbington Valori:
The short answer to that is we’re still totally open. And what we want to do is spend this money most effectively. So on the best ideas, on the best projects, on the best teams. I think, though, the Frontier team has diligenced over 500 carbon removal companies. We have a portfolio of 60 companies today. And so we do know this space relatively well. As we think about the deployment strategy for this growth AMC, it’s really going to be likely a combination of, really high-performing, existing portfolio companies and new companies, larger, longer bets, and sort of across a diversity of pathways. And I should perhaps say that $900 million is at once a small and large number. So it is both a great step forward, meaningful for the carbon removal market, especially in this moment. And there will likely be projects that we cannot buy from who are also great and very high potential. So over the next couple of years.
Robinson Meyer:
Can you give us a sense of the technology landscape as you see it at the moment? Because I think one thing that’s notable about this announcement is that you kind of go through the technologies that you think are going to be able to deliver gigatonscale. And I do think this is something that’s changed from like the beginning of Frontier, and it was more of a wide open space. It seems like you have narrowed in on some of the technological options that will actually be able to remove carbon on the scale that will be necessary to actually meet our alleged global temperature targets. What are those technological options as you see them?
Hannah Bebbington Valori:
I mean, I think what has been really remarkable is the pace of technology development and carbon removal. So when we launched Frontier back in 2022, fewer than 10,000 tons of permanent carbon removal had been done to date. Most of carbon removal was really like an idea in someone’s head or in an academic paper. And we now have hundreds of companies building. We have real world data across most major pathways. And so, yeah, we are so much more opinionated today. We have so much more information about what that gigaton scale portfolio will look like. And at the same time, there are still so, so many questions about realistically how big and how cheap can these technologies get. But sort of with those caveats, we think of this market as having about five pathways that are on a spectrum and the spectrum being of sort of how relatively well understood and sort of well-bounded is this technology. And when I say relatively, everything in carbon removal is still pretty nascent compared to some other climate tech industries, but sort of within carbon removal. So on the one hand, we have things like biomass-based approaches, or often abbreviated to something like bikers, so BECCS and other biomass-based technologies.
Hannah Bebbington Valori:
You know, these are technologies that today are delivering tens of thousands of tons of removal. They’re relatively well understood. We have facilities that are building capacity on the hundreds of thousands of tons. They enjoy a lot of existing policy support. We have many different biomass-based approaches in our portfolio, Vaulted, Charm, Exergi, Hafslund Celsio.
Robinson Meyer:
This kind of ranges from like burning biomass, capturing the carbon, injecting the carbon below the ground, to the Charm approach where you create this bio oil from biological material that’s photosynthesized. And then you would just inject that deep below the ground. Lots of injection of biomaterial, but it kind of ranges from traditional bioenergy to...
Hannah Bebbington Valori:
More experimental like charm. Yeah, bioenergy with carbon capture obviously generating a stream of CO2, and then other biomass approaches, Charm and Vaulted, injecting some form of either bio oil or biomass flurry. This pathway is constrained by the amount of sustainable waste biomass that the world has and can aggregate and access in an economical way. And so we think, while very compelling, so likely to be cheap, likely to have a lot of political support, is going to deliver part of our gigaton scale portfolio. And sort of on this end of the spectrum, I would also put enhanced rock weathering and direct air capture, technologies that are relatively well understood being deployed in the field, but are capped in some way. Enhanced rock weathering, relatively capped in scale at the single digit gigatons, direct air capture likely capped by its total potential cost. So all three potential to be part of the gigaton portfolio, but not a winner takes all technology.
Hannah Bebbington Valori:
On the other hand of the spectrum, we have things like surficial mineralization, ocean alkalinity enhancement. These are technologies that we are super bullish about, have enormous potential, enormous scale potential, could deliver more than 10 gigatons a year at relatively affordable prices, less than $100 a ton, but have relatively less real world data. So these are still more in the conceptual phases. And a lot of the work that we are doing at Frontier is how do we get more startups working on these ideas, testing and refining these ideas in the field so that we can better understand what the true potential is here. So superficial mineralization, taking reactive rock either from waste rock piles at mines or mining it where you find a deposit, exposing that to air, likely piling it on a heat bleach pad. This is something that we think very, very high potential and yet we don’t know enough yet.
Robinson Meyer:
It seems like Frontier is approaching this round a little differently than the first round. I mean, I think when Frontier launched, it was like a classic advanced market commitment. I think the term I used in, I was working at The Atlantic at the time, but it was like buyer of first resort. You were going out into the market. You were supporting a lot of being the first customer for a lot of interesting technologies. What’s interesting over those intervening years is that Frontier has been in the market for a long time. I think you guys have bought, what, 1.8 million tons, maybe around there. Since 2022, an enormous buyer entered the market in the form of Microsoft. It bought 70 million tons, give or take like 5 million on each side. And now, as we recently reported here at Heatmap, it has paused its buying for the moment. And so it kind of was this enormous anchor buyer in the market, but now it’s gone. And so it’s a market that’s gone through a lot of convulsions. There’s a lot of good companies sitting out there that maybe were planning on a customer that has gone away. How is that shaping this round? And how are you thinking about Frontier’s role given that kind of, in some ways, we’re in this weird moment where it’s like we don’t need an advanced market commitment anymore. The market existed, but then the market kind of went away. And so how are you thinking about structuring Frontier’s market activity to support demand through the next several years.
Hannah Bebbington Valori:
Yeah, I think we think a lot about what is the role of the corporate buyer in carbon removal, especially the corporate buyer sort of at the Frontier scale, so buying millions of tons of removal today. And really the way that we answer that question is we think, okay, where does the carbon removal market need to be? Or what is the end goal for carbon removal? And how do we get there? And what needs to happen next to be on the right trajectory to scale. So when we think of carbon removal at gigaton scale, we are really looking at hundreds of billions of dollars of annual procurement spend. And that scale of market is unlikely to be delivered by the voluntary carbon market. That has actually always been true. The voluntary carbon market is sort of unlikely to get to that point. And so then you imagine that this market at gigaton scale is going to have to be government driven. Now, government driven can take a lot of different flavors and form factors. So it doesn’t necessarily mean government pays. What it means is ...
Robinson Meyer:
And this is true of all waste markets. I mean, if you think of carbon removal as a type of waste market, what happens is the government, I mean, we as taxpayers or the public in some kind of broad sense pays to remove the waste, but like the government comes and picks up our trash. For instance, the government does remove the waste from the water. You know, like if you think about this as a form of waste management, then it would be very natural for the government to take it over. Of course, it is different from other forms of waste management. Management, let’s say, in that it’s maybe thermodynamically and scientifically a little more ambitious than trash pickup.
Hannah Bebbington Valori:
Yeah. There’s a stat actually that we love that the world spends $1.4 trillion on waste management. And so as we think about hundreds of billions spent on carbon removal, it’s not unprecedented. It’s large, but we can see a path.
Hannah Bebbington Valori:
If we’re moving to government-driven demand, what that looks like to us is sort of likely one of three things. One is we have compliance markets or emissions trading schemes of some form. So really, corporates are paying for carbon removal to neutralize their residual emissions, but they are mandated to do so.
Hannah Bebbington Valori:
We can write carbon removal into existing industrial regs. So, for example, we could mandate that wastewater treatment plants use limestone to manage their pH, which actually might be better and easier and cheaper than existing chemicals that are used today. Or you could imagine direct funding of removal activity, and that could be direct procurement, direct buying of tons, and it could be things like tax credits and subsidies and so on. But the government can’t use taxpayer dollars to pay for stuff that is unproven or very risky. And similarly, it can’t mandate the use of technology that’s super expensive. And so before we get to that government-driven future, we really need to de-risk the technology. We need to pull it to commercial scale. And we need to make sure that it’s affordable and predictable and reliable. And that is the role of corporate buyers. So this is a long-winded way of answering your question. But really, we think of this growth AMC as saying, OK, what can we as corporate buyers do to pull that future into being? So to ensure that we are de-risking the most promising technologies, we are helping those technologies go to scale, and we are actively partnering with governments around the world to make sure that we are setting up this baton pass or even a public-private partnership whereby there is sustained and robust long-term demand for these projects once our off-take agreements expire.
Robinson Meyer:
And so what does that mean from a project buyer standpoint? How does that actually change how you’ll relate to companies or work with companies during this new phase?
Hannah Bebbington Valori:
Yeah, there’s a few different ways that this can look like. In short, it looks like we’re prioritizing projects that have line of sight to government driven demand or who we think that in buying from that project, we make it more likely that a jurisdiction gets excited about policy and carbon removal. So to give you a couple of examples, a great example of a project we’ve already done where we would love to do more like this is like the Stockholm Exergi facilities. Stockholm Exergi has a bioenergy facility in downtown Stockholm. It delivers most of the district heat to the city. They are installing a carbon capture retrofit to capture the carbon emissions off of that facility and injecting in the North Sea. Frontier and Microsoft were some of the original offtakers of this project. And in being an offtaker, we also allowed Exergi to qualify and then to win, an award from the Swedish state aid auction, which is filling out the rest of their offtake stack and sort of ensuring that this project is viable and can get built. A perfect example of a public-private partnership making a carbon removal project happen and paving the way for more of those types of projects to get built in places like Sweden and around that area.
Hannah Bebbington Valori:
If we could find more projects like that, so more projects where we either have a direct link to policy, where we can buy from a project, get that project FID, and in doing so get the local jurisdiction really excited about bringing more of that economic activity to their jurisdiction. Those are the types of things that we really want to see.
Robinson Meyer:
Does that mean basically not prioritizing projects in the United States because the U.S. is not a primary supporter of carbon removal technology at the moment?
Hannah Bebbington Valori:
This is everyone’s favorite question. In short, no, I think. So A, there are existing carbon removal policies that persist today in the U.S. Carbon removal has fortunately enjoyed quite a bit of bipartisan support. So things like 45Q is another great example of government-driven demand. 45Q pays for the injection of CO2 underground. So already not disqualifying. And I think for sure, if we could imagine a world of either expanding 45Q or having a more tech neutral tax credit, which has been considered in the past, that is like the type of direction of travel we would love to see for U.S. policy. And then I think more broadly, if you work in carbon removal, you are like inherently an optimistic and long-term thinking person. Otherwise, you would go crazy. And I think we really believe that sort of in the long arc of the future, the U.S. will be a meaningful player in building a carbon removal market.
Robinson Meyer:
I hope so too. And so one of the other big pieces of news that came out of this round is that Anthropic is joining Frontier. It’s quite interesting because I think this is really the first big climate program that Anthropic has joined. Unlike, say, Apple or Microsoft, they don’t have really notable public corporate climate. Can you give us any detail about the size of their contribution to Frontier or kind of what they mean as a coalition member?
Hannah Bebbington Valori:
Yeah, I mean, we’re just thrilled to have Anthropic in the group. It represents a couple of different things to us. So one is carbon removal is a really important part of any corporate climate program. And really like any national climate program. The reason why we care about carbon removal is because IPCC experts talk about how the world is going to stabilize global temperatures and the need to both radically reduce the emissions we emit and proactively scale a portfolio of permanent carbon removal technologies, because otherwise we’re not going to get to zero without both of those efforts. And so to us, someone like Anthropic signing up to Frontier is indicative of how organizations are thinking about building their overall climate programs, which is that carbon removal should be a pillar of the work that you do. I also think part of this and part of what is true of anyone who joins Frontier is like a love of sort of lowercase-f frontier technology and an optimism about the way that technology can help advance the world. And folks who join Frontier and who buy from these, really nascent emerging technology companies are really making a bet on human ingenuity and our ability to sort of create the world that we want to see in the future. And so we’re stoked. We’re stoked to have Anthropic on board.
Robinson Meyer:
But you can’t give us dollar amount.
Hannah Bebbington Valori:
I can’t give you dollar amounts. And actually, we, as a rule, don’t give anyone’s dollar amount. So this is not specific to Anthropic. But yeah, we keep it kosher with a top line number.
Robinson Meyer:
Well, can I can I just push a little further and say, I do think there are people who are going to see Anthropic join and say, Anthropic, complicated company, because on the one hand, I think it’s been the most If there’s any company, I think, that’s kind of pledged most among the frontier AI labs to uphold, let’s say, liberal democratic values, I think Anthropic obviously has to be top of the list. At the same time, they’ve partnered with xAI. They seem to be using a lot of compute at this Colossus Data Center, which is particularly carbon intensive in Tennessee. I think there are people who say carbon removal is kind of a delayist technology. It allows companies to keep emitting fossil fuels, to keep burning carbon and kind of promising to clean it up later, but not doing anything to reduce emissions in the near term. And Anthropic would be a great maybe example of this. What would be your response to that? Yeah.
Hannah Bebbington Valori:
Well, I think my response to that would be a couple of things. One is the moral hazard around carbon removal has really not come to fruition. This concept that companies buy carbon removal as kind of a way to get out of corporate climate commitments or other climate activity is like really not borne out in the data for a couple of reasons. One, the people who care about carbon removal are the people who care about the climate. And so those folks are often building broader programs that include carbon removal and other things. Two, these are all voluntary activities today. And I think they’re very, very expensive ones at that. So buying carbon removal today costs hundreds of dollars a ton. Like it is not, if you wanted a sort of get out of jail free card, Frontier and carbon removal is not that. There are many other ways to have a climate program or maybe have a broader sort of civic responsibility program that are much cheaper than what we do.
Hannah Bebbington Valori:
And I think this is borne out sort of generally in the data, like how much money we spend on carbon removal versus how much money we spend on decarbonization efforts. Rightly so is a fraction. And so the world as it stands is not replacing carbon removal with other decarbonization activities. Rather, buying carbon removal today is recognizing that this market will not turn on like a light switch in 2050 when we want it if we don’t invest today. And so folks who buy carbon removal now are really sort of playing that long game thinking into the future about what we want to exist and investing today to make that happen.
Hannah Bebbington Valori:
And then, you know, the other way to answer this question is like we should hold folks’ feet to the fire on this. So people who buy carbon removal, honestly, people who don’t buy carbon removal should be thinking about decarbonizing their emissions.
Robinson Meyer:
Where is OpenAI? They should be a Frontier …
Hannah Bebbington Valori:
Totally. You can call them and tell them that. We should be banging on the doors of these companies and many other companies to be asking them, what are you doing to decarbonize? And that is not just Anthropic. That is everyone.
Robinson Meyer:
You have this particular purge at Frontier into carbon removal. And as we’ve kind of been dancing about in this conversation, it’s been a tough year for carbon removal. I think the removal of Microsoft as a major corporate buyer is really devastating for some companies. And we were already expecting, I think, some kind of retraction or carbon removal recession. To some degree, climate tech’s been in a broader recession, I think, for the past two years. But this is really going to deepen and continue it for carbon removal. But you have a particular view of the industry at Frontier because lots of people come to you for money and they are pretty open book when they come to you for money and you learn a lot about their projects so what do you see in carbon removal that you feel like people haven’t realized yet or that nobody else sees about the industry like when you see other discussions of carbon removal. What do you think people are missing at the moment?
Hannah Bebbington Valori:
So, it’s true that the demand question keeps me up at night. It’s why we set out to raise this growth AMC, was to make sure that we are doing all that we can to put this market on track to scale. So, I do not, like, I do think that is a headline that you mentioned, and it is a headline that is so real. And so, I don’t want anything I’m about to say to sort of contradict that. I think the thing that people miss or perhaps undersell or under-celebrate is the technology progress is insane.
Hannah Bebbington Valori:
That we have gone from a space that really had a handful of companies, no deliveries, no third-party registry, no protocols, very little demand-side legislation in basically only one country, to so much more than that. So, you know, we have tens of thousands of tons being delivered. We have large scale facilities being built. We’ve like crossed approaches off the list, which in and of itself is amazing. And such as what an efficient way to spend money is in a very short period of time to be able to say there are a few things that we don’t want to concentrate our efforts on anymore and start to narrow our focus. I think the 2020s are really about technology development and shaking the trees to say, if we’re going to get to gigaton scale by 2050, we need to as quickly as possible learn what works and what doesn’t work and double down and make those decisions quickly and decisively. And I think we under-celebrate how far we’ve come along that journey in a relatively short period of time, honestly, with a relatively small amount of money.
Hannah Bebbington Valori:
Especially for some of the projects that don’t have a Microsoft offtake, we’re looking at quite an efficient use of capital.
Robinson Meyer:
Well, can you give an example of how the technology has come along in a way that people may not understand?
Hannah Bebbington Valori:
Yeah. So when we did, Frontier buyers were the first buyers to do a commercial scale purchase of enhanced rock weathering. And our first deal was Lithos. It was our biggest offtake agreement at the time, 60 million. When we did that deal, there was no protocol to measure the amount of weathering that was happening and the amount of carbon removal that was being generated by the practice. And so when we did that deal, it was like a big risk to write an offtake agreement with a fixed price and a fixed volume and a fixed delivery schedule for something that didn’t have a well-studied weathering curve and didn’t have a protocol for measurement. Today, we have multiple enhanced rock weathering companies who are delivering on isometric, on a third-party registry with an approved protocol. We have a much more robust data set for what those weathering curves look like. We have a much greater understanding of what the uncertainties are in the carbon removal drawdown process and how to quantify the enhanced rock weathering. And I think we’re getting on the order of tens of thousands of tons delivered this year from those contracts. And so it’s an example of a field that was really like an idea in 2022 and is now reaching a commercial scale technology. That’s like a five-year lifetime.
Robinson Meyer:
We previously touched on this, but of course, at the moment, the U.S. has been trying to spin up a carbon removal purchasing program for a little while. Congress has authorized it. The Trump administration has seemingly sat on it at the Energy Department. We do have a tax credit called 45Q that subsidizes the direct air capture of carbon dioxide from the atmosphere and its injection underground, but it doesn’t subsidize any other form of carbon removal. So it doesn’t, for instance, help enhance rock weathering or ocean alkalinity enhancement or any other alternative form of carbon removal technology, but look, there’s midterms later this year. There’s a presidential election in two years. Money’s, I think, going to be a little harder to come by than it was in 2021 during the first year of the Biden administration. Is there a policy that you think would be most important for the U.S. to adopt to support carbon removal technology going forward? Like what’s number one on your wish list?
Hannah Bebbington Valori:
Well, number one is actually a policy that has already been proposed and sort of since been shelved. But I believe it was Senator Bennet and Senator Murkowski put up a tech neutral tax credit. So basically taking the concept of 45Q, paying some portion of the costs of carbon removal from one technology and expanding that to cover a much, much wider swath of technologies. Something like that which has already been conceived of and sort of rolled around in the administration would be amazing for guaranteeing a price for carbon removal in the U.S. And for doing that across a variety of technologies and the other benefit of guaranteeing a floor price here is that you can really incentivize many different technologies to start to race to that price. What you can do then is you can sort of build a competition or sort of an arena of innovation, right, where folks are really saying, we want to get down to this price, both so that we can be competitive in the market, but also, you know, perhaps so that we can win or take all in the U.S., if you will. It’s not the only policy that would work in the U.S. And I think one thing that’s really important to stress about carbon removal policy is I think some people get fixated on certain ideas, a carbon tax, a compliance market, contracts for difference, an auction, a tax credit,
Hannah Bebbington Valori:
capex subsidies. Honestly, all of it is great. All of it works. And we’re probably going to see different form factors in different jurisdictions, kind of based on like what the ideological preferences in those countries.
Robinson Meyer:
Fantastic. Well, I think there’s so much more to talk about, but we’re going to have to leave it there. Hannah Bebbington Valori, thanks so much for joining us on Shift Key.
Hannah Bebbington Valori:
Yeah, thanks for having me.
Robinson Meyer:
And that will do it for this episode and this week of Shift Key. We’ll be back next week with at least one new episode. We have a run of amazing guests coming up, I have to say. Before you go, though, I just want to say, I don’t know if you subscribe to Heatmap Daily, which is Heatmap’s afternoon newsletter. It comes out every weekday. But if you don’t, you really, really should. I have taken over writing that newsletter. It’s really just me. I write it every afternoon. And it’s a place where I can share my analysis or observation or thoughts or reporting on the energy and climate and decarbonization news of the day. I’m having a lot of fun writing it. Honestly, a lot more fun than I thought I would. It’s become just a really cool space. And if you don’t follow it, I really recommend you should. Because if you listen to this show and you’ve made it this far in the podcast, you should be following this newsletter. You should subscribe. So we’ll stick a link in the show notes. You can find the link really easily too if you just go to heatmap.news. But we’ll take a look in the show notes, subscribe, Just go do it now. You’ll enjoy the newsletter. You’ll have fun. It’s free. I write it. That should be self-recommending if you’ve made it this far in the podcast. And thank you for doing that. Shift Key is a production of Heatmap News. Our editors are Jillian Goodman and Nico Lauricella. Multimedia editing and audio engineering is by Jacob Lambert and by Nick Woodbury. Our music is by Adam Kromelow. Thanks so much for listening. Enjoy the long weekend of you here in the U.S. And see you next week.