“It’s a chicken or an egg problem,” said Nan Ransohoff, head of climate for Stripe, an online payments company based in San Francisco. “The best way to reduce the cost is to start deploying these technologies at scale. But until there are real customers, no one is going to build them. “
To help break the deadlock, Stripe announced in 2019 that he would start spending at least $ 1 million annually on carbon removal, without worrying about the price of the ton initially. The objective was to evaluate companies that work on promising technologies and offer them a reliable income stream.
After gathering outside experts to review requests, Stripe announced its first round of payments last May. This included an agreement with Climeworks, a Swiss start-up that has already built several small direct air capture plants in Europe. Stripe also paid $ 250,000 to Project Vesta, a nonprofit organization that plans to spread volcanic minerals on beaches, testing how much carbon dioxide they absorb as waves break them, through a process known as improved weathering.
Companies that receive Stripe funding say the money was crucial.
“It’s existential for us,” said Peter Reinhardt, co-founder of Charm Industrial, a start-up that Stripe is paying to remove 416 tons of carbon dioxide at $ 600 per ton. Your company will take the crop residues and convert them into an oil that can be injected underground, instead of letting the residue decompose and release carbon back into the atmosphere.
Other companies are investing in a similar way. German automaker Audi is paying Climeworks to capture and remove 1,000 tonnes of carbon dioxide from a new direct air capture facility in Iceland, scheduled to go online this year. Climeworks also signed an agreement with Swiss Re, the insurance giant, which this month created a funding stream dedicated to carbon removal. Shopify, a Canadian e-commerce company, has already committed $ 1.6 million to several carbon removal start-ups.
Christoph Gebald, co-director of Climeworks, said his company now has more than 50 corporate customers paying to capture and store carbon dioxide. Its goal is to build enough facilities to remove 30 million to 50 million tons a year from the atmosphere by 2030.