Direct Air Capture: Where We’ve Been and Where We’re Going

Over the past century and more, our primary method of obtaining energy has been heavily reliant on carbon-based resources such as oil, coal, and natural gas. We extract these fuels from underground, burn them to generate energy, and unfortunately, release carbon into the atmosphere in the process. For over 100 years, we have been stuck in this cycle of taking carbon from the ground and depositing it into the atmosphere.

When we take into account both CO2 and CO2 equivalents, the average annual emissions of these greenhouse gases range from 40 to 50 gigatons. Now, looking ahead to 2050, our goal is to reduce these emissions. But not only that, we need to remove a staggering 10 Gt/year.

Let’s put this challenge into perspective: we’re essentially tasked with building an entirely new industry from the ground up within just 20 years. And this new industry needs to be at least one-quarter as developed as what we’ve achieved over the past century. That is a big challenge, and this is why people are excited about making quick progress.

Enter Direct Air Capture or DAC — an approach that has been qualified as necessary by the IPCC 2021.

In this article, we will explore the history of DAC, how the different technologies work, the current state of the industry, and why DAC might be necessary in the fight against climate change. The road ahead for DAC isn’t without challenges, but the potential benefits to our planet are huge.

Join us to learn all about the past, present and future of pulling carbon out of thin air!

What Is Direct Air Capture?

Just a quick reminder: while we will explore DAC in this article, there are many ways to remove carbon from the atmosphere. Broadly, solutions fall into three categories:

1. Biological Approach: Enhance natural removal pathways.
2. Engineered Approach: Use technology to extract CO2 from the air.
3. Hybrid Approach: Combine elements of both engineered and biological methods.

DACs fall into the Engineered approach category. They provide a way to remove CO2 from the atmosphere to address climate change.

Figure 1. Explanation by Sylvera

Four crucial aspects define the success of DACs:

1. CO2 traps: Implementing chemicals that act as effective traps, binding to CO2 molecules (often liquid solvents & solid sorbent but we will delve into this later).
2. Air Circulation: Finding ways to move and expose the air to these traps, using minimal energy. While wind power may be suitable for certain locations, others may require using fans to engineer air movement through the sorbent or solvent material.
3. Extracting: Applying minimal energy to collect the trapped CO2 in purified form (most energy intensive step in DAC operation). After engineering the traps, we can extract CO2 from the dilute mixture, breaking the bonds between CO2 and the trap to obtain purified CO2.
4. Storing: Storing the captured CO2 is essential. To have a positive impact on the climate, CO2 must be stored geologically for extended periods, lasting decades to thousands of years. This ensures its complete removal from the global carbon cycle. That’s why DACS (Direct Air Capture and Storage) are truly the negative emission technology, not just DAC. Storage is key.

All this need to be achieved while being economically (low costs) and technically (high volume of carbon capture) viable, without consuming to much energy in the process.

Two approaches stand out: liquid solvent and solid sorbents

Both methods revolve around engineering materials or molecules that act as traps to capture CO2 from the air. These solvent/sorbents are designed to selectively adhere to CO2 while avoiding the binding of nitrogen, oxygen, or water, which are abundant compounds in the air:

• Solid sorbent DAC: air is passed over materials like activated carbon, zeolites, or amines that physically absorb the CO2. These sorbents are then heated to release the CO2 in a highly concentrated stream.

Figure 2. Carbon Credits

• Liquid solvent DAC: uses chemical reactions to capture CO2. As air bubbles through a liquid like sodium hydroxide, the CO2 reacts with the solution and binds to it. The CO2 is then released by heating the solution.

Figure 3. Carbon Credits

Currently, the three biggest actors use one of these two approaches (Climeworks, Carbon Engineering and Global Thermostat).

• Carbon Engineering (Canada-based, founded in 2009, $110M raised): Uses liquid solvent (potassium hydroxide). In simple terms, carbon dioxide acts as a weak acid, and the basic liquid is employed to trap this acidic carbon dioxide (reminiscent of the acid-base reactions we learned in high school chemistry classes).
• Climeworks (Swiss-based, founded in 2009, $650M raised) & Global Thermostat (US based, founded in 2010) : use solid sorbents (primarly Amines). These amines, being weakly basic chemicals, also undergo an acid/base reaction with CO2.

A lot of companies use amines because they are extensively studied for acid/base reactions and already employed in CO2 capture in gas purification plants. These are well-understood, commercially available (although it is debatable), relatively low-cost, and highly selective for CO2. This selectivity is essential given the need to distinguish CO2 (0.04% of the atmosphere) from nitrogen, oxygen, and water, which make up over 99% of the atmosphere.

At the end of the day, it’s all about finding a way to decrease costs and increase capture amount with clean energy. We will talk about this later, but there is room for plenty innovation depending on the location of the DAC.

Milestones in the Development of DAC Technology

The history of DAC spans over two decades, with key milestones shaping its development (see below).

Figure 4. DACs timeline

• 1999: Klaus Lackner, a chemical engineer at Arizona State University, first proposed DAC as an effective way to address climate change.
• Mid-2000s: The first academic papers discussing DAC were published, covering both climate and engineering aspects of the technology.
• 2009/2010: Three significant startups (Carbon Engineering, Climeworks, and Global Thermostat) were founded.
• 2011: A report by the American Physical Society reinforced the belief that DAC would be prohibitively expensive (e.g. $1000/ton), causing a slowdown in DAC development.
• 2011–2017: Despite this belief, academics and policymakers continued working on R&D and found ways to make DAC more cost-effective. More research suggested that DAC could be cheaper than previously anticipated, with a global target of $100/ton.
• 2018: In the United States, there was an acceleration of interest and research in DAC, largely due to a federal tax credit (45Q) for CO2 capture and storage underground. California also began using carbon capture to gain credits in the Low Carbon Fuel Standard carbon market. Private investors, NGOs, and government entities showed increasing interest and investment in DAC. A National Academy study also laid out how DAC could become even more cost-effective, along with other methods of CO2 removal from the atmosphere. This marked a turning point for DAC, leading to increased interest and development around the world.
• 2020 and onwards: 20 years after the initial concept of DAC (!!), the first plants capturing CO2 were finally becoming a reality with Climeworks planning plants in Switzerland and elsewhere.

So first generation of DACs came in 2009 and demonstrated the feasibility of using machines to extract amounts of CO2 from the air, marking a huge technical milestone. But they faced challenges due to their energy-intensive desorption step, which resulted in high energy consumption per tonne of captured CO2. Also, many experts in gas separation believed that DAC would be too costly, stating that it could not cost less than $1000/tons.

Considering this, there has been an upswing in the advancement of second-generation DAC processes and companies from 2012 to 2020. Their main objective was to minimize the cost of DAC technology. But while these R&D efforts enabled to bring down costs (on the order of $700/tons right now), we are still far away from what is needed for the technology to have a real impact on climate change (both due to economic, technologic and energy issues). The real challenge now begins: DAC scalability.

DACs: Scalability issues

As discussed, DACs face three primary challenges that hinder their scalability: I) cost-related issues, II) the need to capture carbon at a large scale, and III) energy consumption issues to make it work.

Cost Issues…

Out of all carbon capture applications, capturing CO2 from the air is the most costly. This is because the concentration of CO2 in the atmosphere is much lower compared to sources like flue gas from power stations or cement plants. So DAC requires more energy and incurs higher costs compared to these other applications.

Currently, DACs applications come with a price tag ranging from $600 to $1000 per tonne of CO2 captured from the atmosphere. When we take into account that permits on the European Union’s carbon market reached $106.57 per tonne recently (early 2023), the cost of capturing CO2 is six times higher than the selling price at its peak. This makes it challenging to establish a viable business model for DACs at the moment. According to BCG, costs must decrease to below $200 per metric ton, ideally closer to $100 per metric ton, by midcentury to have a significant impact on global climate goals (don’t really understand how this would be viable though, as it would only match the carbon price at its peak. If you have a POV on this, please reach out).

…Carbon capture at large scale issues..

As of now, DAC-based technologies remove less than 0.01 million tonnes of CO2 / year. Still, to align with the NZE Scenario, a scale-up is required targeting approximately 70 MtCO2/year in 2030 and around 10GtCO2/year in 2050, equivalent to Indonesia’s total energy-related CO2 emissions in 2021.

… and Energy consumption issues…

Current DAC installations have a very large energy footprint. A significant amount of energy (and consequently, CO2 emissions) is needed to potentially capture a small amount of CO2. For critics of DAC, this is the final straw.

Yup, much like numerous other industrial procedures, DAC demands a substantial energy input. The most advanced methods available today would necessitate over 100% of the globe’s renewable energy capacity to eliminate the maximum annual CO2 tonnage required (roughly 40GtCO2/y).

Jean- Marc Jancovici stated that “If we wanted to capture, using this kind of DAC device, the entirety of our annual emissions, we would need to dedicate all of the yearly electricity and all of the oil consumed in the world each year to it. Therefore, the energy would only be used to recover the CO2 emitted into the air due to energy consumption.” Quite an ironic situation.

At gigatonne scale, DAC will also faces limits beyond energy and cost — water, land, materials, and supply chains. Neglecting these could worsen environmental problems.

… But the game is not over yet

Figure 5. Life cycle GHG emissions in kg CO2-eq. per ton of gross CO2 removal with the DAC plant as well as carbon removal efficiencies [%] for different system layouts in selected countries (Source: https://pubs.acs.org/doi/10.1021/acs.est.1c03263#).

In some cases, we can remove more CO2 than we create through DACs. The carbon removal efficiency can vary a lot (widely from 9% to 97%) depending on the geography, energy type, technology used, etc…

Despite all the issues, brilliant minds worldwide are actively trying to tackle these challenges. Their motivations aren’t necessarily technolutionist, as some claim. Many are simply guided by the IPCC’s assertion: carbon removal (at scale!) is essential. Starting the cutbacks a few years back could have rendered these technologies redundant, but now it is too late. For them, with the urgency of having surpassed the point of no return, any argument against its feasibility should trigger extensive research akin to the Human Genome Project.

Next steps for the DAC industry

The driving force behind this deep dive is the recent collaboration of leading teams aiming to forge the third generation of scalable DACs.

More and more brillant teams are entering the space

As always, illustrating logos on a map is a good method for comprehending an environment so let’s do it (see below). Not comprehensive — if you know of other teams taking the plunge, give us a shout!

Figure 6. DACs Mapping

As of now, the International Energy Agency reports 130 DAC plants in global development, comprising 27 commissioned and 18 completed. These are all small-scale facilities, collectively capable of removing around 11,000 tons of CO2 annually.

Figure 7. Direct air capture expansion projects of selected companies (Capacity in kt CO2/year)

Initial DAC tech demonstrated machine-based CO2 removal, but heat-driven desorption inefficiencies led to high energy use per ton of CO2. After several lab experiment, the 3rd generation of DAC aim to solve this by employing different strategies:

• Moisture swing renewal: Sorbents absorb CO2 when dry and release when wet, meaning that you need water rather than electricity for desorption. Yet, vacuum and compression energy is needed, and regeneration depends on air temperature.
• The utilization of zeolites for DAC has gained traction due to their porous structure, ideal for CO2 adsorption. In Norway, the inaugural operational DAC facility using zeolites was established in 2022, and the Removr project aims to scale this technology to a capacity of 2,000 tCO2/year by 2025.
• Enhancing sorbents: optimizing properties to reduce heat needed for solid sorbent regeneration. While this lowers energy usage, material optimization can complicate manufacturing.
• Electro Swing Adsorption DAC (ESA-DAC): employs an electrochemical cell where CO2 is absorbed on a negative charge and released with a positive charge. It’s currently in development in the US and UK. Still, electrochemical cells have their own inefficiencies (reduced Faradaic efficiency & Voltage efficiency).
• Passive DAC: expediting the natural conversion of calcium hydroxide and atmospheric CO2 into limestone, a method currently being developed in the US by Heirloom.
• Process integration: Using the waste heat of industrial plants or buildings to lower the energy required to heat the sorbent.
• …and the list goes on.

A winner-takes-all market ?

With all these new start-ups popping, it is easy to wonder: “Which tech will really win the big prize? How do I know I’m working on the next big thing?”

Well, it seems DAC isn’t a winner-takes-all tech field. It’s not about one big solution. We’re talking about 3, 6, 8, 10, even 20 different innovations that matter. Why? Because what works best varies by location.

Figure 8. DAC and CCS plants around the globe

Look at it from a chemical engineering angle: DAC pulls in air wherever it is set up. Up north near the Arctic? You are dealing with cold. Down in the Middle East? Heat is the issue. So, the smartest, most cost-effective DAC designs differ a lot. Forget about that one-size-fits-all magic answer.

That being said, one approach seems to be more & more adopted. A lot of teams are trying to scale DAC thanks to process optimization. They create machines that use established and familiar technology, and the waste heat of existing infrastructures like industrial plants or buildings to lower energy consumption during desorption. So it really seems to be a matter of process integration now. This will likely turn into a supply chain issue very soon.

The next challenge: scaling Supply Chains

One big hurdle in pushing forward the progress of DAC is setting up efficient supply chains. Many startups use existing market components, gradually improving cost-efficiency.

As we get better at this and try to make things cheaper (going from $500 to $300 to $100 per ton), we’ll start dealing with more advanced technologies. This means more special gadgets, custom gas-solid contactors, and solutions that will need completely new supply chains.

Right now, we’re not making these custom parts, but soon, we might have to make millions of them every year. The challenge might be getting these supply chains up and running and teaming up with bigger companies that have the money to invest in making these parts / the infrastructures for creating these elements.

Conclusion

In the world of DAC, we are walking a tightrope between speed and patience, as

• Urgency is driving us to move quickly after years of inaction. We’re asking tech creators to speed up their cycles — going from design to deployment and learning every 18 months instead of waiting 3 to 5 years,
• but we also need to recognize that building an entirely new industry takes time. It takes time for technology to improve. It takes time for costs to come down.

It is a balancing act. We can’t get frustrated if change is not immediate, but we can’t afford to slow down either. Policymakers need to push for speed, and investors need to understand that this is a long-haul commitment, not a quick fix.

So what’s next?

1. Incentives are crucial, from both private and government sources,
2. Welcoming new minds, especially young talent in fields like chemistry and engineering, will keep innovation alive,
3. Everyone’s involvement counts, whether it’s tech experts or community members in the areas where DAC projects are happening (yes, local communities might not always be keen on having these big installations nearby).

I hope you liked reading this article! Your thoughts are really important to us. If you know of any teams working in this area, feel free to reach out.

At OVNI, we invest in pre-seed/seed stages and partner with founders who have global ambitions from day one. If you are a founder in this space or know someone who is, feel free to contact me at thomas@ovni.vc.