(Bloomberg) -- The clean-tech venture firm founded by Bill Gates is providing a $40 million grant to carbon-capture startup Deep Sky Corp., which seeks to build large-scale facilities to clean carbon from the air.
The world will need to remove billions of tons of carbon dioxide from the atmosphere by mid-century to reduce the risk of extreme climate change. Montreal-based Deep Sky aims to provide millions of tons of CO2 removal that will be stored underground. The startup was founded by Frederic Lalonde, chief executive officer of Hopper Inc., a Montreal-based air-travel application company that’s one of Canada’s most valuable technology firms.
The committed funds come from Breakthrough Energy’s Catalyst program, a platform investing in emerging climate technologies. They will be allocated to the construction of Deep Sky’s first plant in Innisfail, Alberta. The facility, requiring an investment of more than C$100 million ($70 million), will test and identify the most promising technologies, and start scaling from there. Other potential storage projects are in the works in Quebec.
Deep Sky expects to start operations and delivering carbon removal credits in 2025. The firm announced in November that it sold credits to Microsoft Corp. and Royal Bank of Canada, but did not provide any financial details.
With Breakthrough, Deep Sky has raised more than C$130 million from the likes of Bank of Montreal, National Bank of Canada, Whitecap Venture Partners, BrightSpark Ventures, the venture arm of Ontario Municipal Employees Retirement System, the Quebec government and others. It has also partnered with several direct-air capture companies such as London-based Mission Zero Technologies Ltd. to test their technologies.
Carbon removal remains a nascent but fertile industry. There are upwards of 800 companies vying to suck carbon from the air using techniques ranging from machines known as direct air capture to scattering crushed rocks in fields. Costs remain high, though, with firms charging hundreds or even $1,000 per ton of CO2 removed.
“The world will ultimately need many approaches to carbon removal at prices far lower than is achievable today,” said the head of Breakthrough’s Catalyst program, Mario Fernandez, in a news release. “Deep Sky’s platform will enable and accelerate the kind of real-world innovation that could make affordable direct air capture achievable.”
Fewer than 30 direct air capture plants had been commissioned in the world as of last April, according to the International Energy Agency. Only a handful are in operation, and largest captures just 36,000 tons annually.
Michael Bloomberg, the founder and majority owner of Bloomberg News parent Bloomberg LP, is an investor in Breakthrough.
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