Deep Sky's Fred Lalonde & BMO's Grégoire Baillargeon talk Climate Change at the CSF Summit 2024

Summary

This video explores the challenges and innovations in carbon capture technologies aimed at mitigating climate change. It covers the development of various CO2 removal methods, including air and ocean capture, as well as the potential for large-scale storage in geological formations. The conversation highlights the importance of integrating renewable energy, scaling technologies, and creating financial infrastructure to support these efforts. The video also touches on the growing market for negative emissions credits and concludes with BMO's investment in Deep Sky, signaling a commitment to advancing these technologies and contributing to a sustainable future.

Takeaways

• 😀 Accelerating carbon capture technologies is crucial to tackle climate change, requiring collaboration and iteration across various approaches.
• 😀 Deep Sky is working to create gigaton-scale infrastructure for carbon removal, combining energy, storage, and technology to scale solutions effectively.
• 😀 Canada has vast geological resources that could store up to 2,000 billion tons of CO2, making it a potential key player in global carbon storage efforts.
• 😀 Renewable energy sources, such as hydropower, are essential for powering carbon capture technologies and supporting their large-scale deployment.
• 😀 Many startups and research labs are working on various CO2 capture technologies, from membranes and towers to systems designed for ocean or air capture.
• 😀 To help scale promising technologies, Deep Sky invests in early-stage companies by purchasing their first units to ensure a customer base.
• 😀 The carbon credit market for negative emissions is growing, with companies and governments starting to invest in carbon removal technologies and credits.
• 😀 Carbon capture technology is still in the testing phase, and a lot of energy will be needed to reach commercialization, with a need for significant financial backing.
• 😀 The economic damage caused by climate change, such as destruction of infrastructure, will make carbon removal credits highly valuable in the coming decades.
• 😀 Despite challenges, there is growing confidence that negative carbon emissions will become a major commodity, driven by the urgent need to address climate change.

Q & A

What is the core challenge in scaling up carbon capture technology?

The core challenge in scaling up carbon capture technology is identifying and optimizing a system that can efficiently capture CO2 from the atmosphere while being energy-efficient. Many different approaches, such as ocean capture, air capture, and utilizing various types of membranes and equipment, are still being tested to find the most viable solution.

How does the company plan to speed up the development of carbon capture technologies?

The company plans to speed up development by purchasing carbon capture technologies from startups that have won prizes, such as the XPrize. They aim to support these companies by becoming their first customer, helping to drive production and allowing them to test various technologies under real-world conditions.

What role do geological formations play in carbon capture?

Geological formations, such as deep saline aquifers and volcanic rock formations, are crucial for the long-term storage of captured CO2. For example, Canada has vast oil and gas reserves that can store between 1,000 and 2,000 billion tons of CO2, which could significantly contribute to reversing climate change.

Why is renewable energy important for carbon capture technologies?

Renewable energy is critical for powering carbon capture technologies because these systems require a significant amount of energy to operate efficiently. Hydropower, in particular, is highlighted as a reliable energy source in areas like British Columbia, Manitoba, and Quebec, where large amounts of renewable energy are available.

What financial strategy is being developed to support carbon capture projects?

A key part of the strategy is developing the financial infrastructure to scale up carbon capture projects. This includes finding ways to finance billion-dollar plants, even when the technology is not fully understood or standardized. Additionally, the creation of carbon markets and negative emissions credits is essential for monetizing these efforts.

What is the future outlook for the carbon credit market?

The carbon credit market is expected to grow significantly as the demand for negative carbon emissions rises. Even though the prices for nature-based credits have fallen, the market for CO2 removal will expand, driven by both corporate and government initiatives. The future is promising, as negative carbon credits will likely become one of the most valuable commodities.

How will carbon removal technologies become monetized?

Carbon removal technologies will be monetized through the creation of carbon credits. Companies, especially in tech, industry, and finance, are already purchasing negative tons of carbon to offset their emissions. This market is growing and will continue to accelerate as the need for CO2 removal becomes more urgent.

What challenges are there in financing carbon removal projects?

One major challenge in financing carbon removal projects is the lack of a clear, established market for carbon removal credits. Additionally, investing in projects that are unproven or technologically complex adds risk, and the scale of investment required is immense. This will require collaboration between the private sector, government, and innovative financing models.

How significant is the insurance industry's view on climate change?

The insurance industry has recognized the severe risks posed by climate change. With increasing infrastructure damage and uninsurability in certain areas, the industry has no climate change deniers. They acknowledge that climate change is leading to rising costs and more frequent natural disasters, which strengthens the case for carbon capture and mitigation.

What is Deep Sky's ultimate goal?

Deep Sky aims to build the first gigaton-scale infrastructure for carbon capture, focusing on storage, energy, and developing the most efficient capture technologies. The goal is to scale up the technologies to a level where they can be mass-produced and deployed globally, offering a solution to the climate crisis.