Carbontech: A trillion dollar opportunity

By Rory Jacobson & Matt Lucas

Currently, a number of innovators — in startups and, to a lesser extent, established firms — are working to recycle waste carbon feedstocks into valuable products. This industry, also known as carbontech, is working to create climate-beneficial materials that perform as well as or better than their incumbents.

Unfortunately, this nascent industry has not received the market intelligence and analysis proportionate to its promise, making it difficult for these entrepreneurs and innovators to evaluate opportunities and attract investment. While revenue data exists for many of the incumbent markets carbontech could penetrate, there has not been a concerted effort to evaluate the economic potential for all technologies employing waste carbon feedstocks.

In 2016, the Global CO2 Initiative hired McKinsey and Company to perform a market sizing analysis of potential markets for carbon utilization. The results of this study indicated a trillion dollar global market, based on the potential of many novel products and substitutes, but the methods, assumptions, and results of this analysis are not publicly available.

In our new report, we provide an open source and transparent analysis of the total available market for carbontech commodities and consumer goods. The total available market includes all revenue from products that could be feasibly made from carbontech materials or conversion processes. In this report, we evaluate the potential for markets including building materials (cements and concrete), wood-based panels, transportation fuels, plastics, chemicals, agriculture and aquaculture, and consumer goods.

Our Key Findings:

  • The economic opportunity for carbontech is huge, spanning numerous sectors of the economy. For 2017, the US total available market (TAM) is $1.07 trillion per year, and global TAM is $5.91 trillion per year.
  • To find the total available market includes, we considered all revenue from products that could be feasibly made from carbontech materials or conversion processes.
  • The largest segment is fuels, which comprises 85% of the US market and 66% of the global market.
  • The top three global markets include fuels ($3.82 trillion), building materials ($1.37 trillion), and plastics ($0.41 trillion).
  • Carbontech touches both global commodities and high-value consumer goods, highlighting the diversity of products and associated business models within the carbontech industry.

Carbontech innovators have managed to break into many of the highest value markets, globally and within the US. Particularly, this early focus on high-volume markets like fuels, building materials, and plastics demonstrates the potential to transition several percents of the global GDP into products that recycle waste and mitigate climate change.

But beyond the climate and waste benefits, this report confirms that there is massive economic potential within carbontech market segments. We are hopeful that this report and analytic market intelligence efforts going forward will demonstrate the exceptional environmental and economic value of carbontech to the investment community. With the necessary capital and entrepreneurial support, we can empower this early community of innovators and actualize the carbontech industry.


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