Carbon Removal in a Time of Climate Disaster
Climate change presents momentous challenges for humanity. In recent decades, activists and environmentalists alike have made great strides to raise climate awareness. However, the frequency of natural disasters is increasing, and the intensity of climate-related issues is becoming crystal clear. If nations do not work together to reduce global carbon emissions before 2030, the effects of climate change will be irreversible.
Although these challenges generate significant threats to the business community, such as supply chain, raw material, and labour disruptions, they also pave the way for climate innovation, like the emergence of carbon removal technologies. The process of carbon extraction creates various opportunities, such as fighting climate change, developing new uses for carbon, and creating economic growth in the Canadian economy.
Putting Carbon to Good Use
Carbon removal was developed to extract CO2 emissions from the atmosphere through harvesting natural waste, industrial machines, ocean-based techniques, and various other processes. The two most widespread carbon removal strategies are the biological and industrial approaches.
Various companies have adopted industrial carbon capture and storage processes to extract CO2 from the atmosphere. This process was first discovered in 1938, but it was not until 1972 that the new technology was used. Now, industrial forms of carbon capture are present in 16 facilities worldwide.
The magic really begins once companies store or create new materials with the carbon they have captured. Carbon captured through natural processes such as trees, crops, and animal waste can be broken down through pyrolysis. Using airtight machines and temperatures generally ranging from 400°C to 800°C, carbon can be converted into biochar, bio-oil, and biogas (see Exhibit One). Biochar is often used to fertilize plants as a soil amendment. In contrast, bio-oil is typically used to power gas turbines and furnaces, and biogas is effectively used to produce methane and hydrogen fuel.
Exhibit One: The Pyrolysis Process
Many industrial carbon removal facilities also have storage processes that transport and inject extracted CO2 into a new home: rock formations below the Earth’s surface. Carbon captured through industrial processes can be concentrated into fuel and many other useful materials.
All these techniques efficiently ensure captured carbon is either stored safely or repurposed. Nevertheless, these processes must be more prevalent in society to offset carbon emissions produced by large corporations. Even then, it is crucial that carbon removal is used in combination with an overall decrease in emissions to make a real impact on fighting climate change.
The Business Case for Canadians
Historically, many industries—most notably retail, oil and gas, and transportation—have been shamed for their significant carbon emissions. However, the introduction of carbon removal technology creates exciting possibilities for Canadian entrepreneurs to redefine businesses’ role in climate change.
Canadians have started making their mark in the carbon removal industry. Airex is an Ontario-based biochar company that specializes in biocoal. Biocoal replaces traditional coal that can be used to create cement and in coal-based power plants. Comparably, Carbon Engineering is a BC-based carbon capture company. One of the products they produce from the carbon they capture is carbon-neutral jet fuel. In summary, as new companies emerge and more alternative uses of carbon are discovered, it is clear that the carbon removal market is expanding rapidly.
Carbon Removal Is Here to Stay
The fast-growing market suggests that this is not some trend businesses are jumping on to stage their fight against climate change. The size of the North American carbon capture and sequestration market reached $1.42 billion USD in 2020. Additionally, the global market is expected to grow to $7 billion USD by 2028, signalling a promising future for Canadian businesses.
Canadian government officials have begun investing in the carbon extraction market. Alberta—home to Canada’s largest oil and gas operations—has made various investments into the carbon removal market. The provincial government recently infused $30 million CAD into carbon capture technology and has already expended $1.24 billion into carbon capture, utilization, and storage projects. This funding is necessary as the cost of large-scale projects averages $1 billion CAD for every megaton per year of carbon reductions. However, only time can tell how impactful these investments will be in curbing Canada’s carbon emissions.
Performative or Meaningful?
The business community's efforts to fight climate change are often criticized for being capitalistic, performative, and greenwashed. However, carbon removal innovation has proven its importance in reaching international climate goals.
Experts believe carbon capture is a real science-driven approach to fixing the climate disaster, but it is not the only step that needs to be taken. That being said, carbon capture efforts will reportedly be able to support 14 per cent of the world’s greenhouse gas reduction goals by 2050. In Canada specifically, the government has expressed its goal of extracting 15 megatonnes of carbon annually to reach net zero by 2050, which many believe is attainable through carbon removal.
Carbon credits, however, are another story. Many carbon removal companies receive investments through carbon credits, where large corporations will purchase credits in exchange for the company removing a certain amount of carbon from the atmosphere. In turn, by purchasing these credits, companies that release significant amounts of CO2 are merely offsetting their activities instead of restructuring their operations.
To bring more credibility to the market, Prime Minister Trudeau recently announced that the Canadian government would launch a GHG offset credit system to regulate carbon offset trading. These enhanced standards will support Canadian entrepreneurs in building a stronger foundation for their carbon removal business and likely incentivize greater investments in the market. However, increased regulation is unlikely to improve the lack of accountability attached to companies that purchase carbon credits.
Capitalist or Not, Carbon Removal Works
The influx of CO2 emissions in recent decades has forced scientists, activists, and business leaders to act fast in slowing the effects of climate change. Although challenges persist, carbon removal is an exciting take at combating extreme climate disasters. With new technology and the development of the Canadian carbon removal industry, CO2 extraction has the power to create a measurable difference in the nation’s climate goals. Although it is unlikely that corporations will stop pumping carbon into the atmosphere any time soon, Canadian entrepreneurs may have the opportunity to rewrite the business community’s role in the climate crisis.