Numerous solutions based on technological innovation are already being developed, most, however, need complementary financial innovations to scale-up and have a significant impact.
With everyone talking about climate change these days, it is important that we keep a level head. As problems become more serious, this becomes more difficult, but one’s chances of surviving a fire in a theatre are considerably greater if the crowd remains calm and exits in an orderly fashion than if it starts panicking. Making it out safely depends on trusting that others will remain disciplined.
Numerous solutions based on technological innovation are already being developed, though most have yet to be deployed on a scale that can significantly curb climate change. For instance, British Columbia’s Carbon Engineering Ltd. is proposing to transform atmospheric carbon dioxide into clean fuel or materials like steel, concrete, coatings, industrial chemicals, and fertilizers. According to the company, the technology would allow each commercial facility to capture one million tonnes of CO2 annually, the equivalent of the emissions of 250,000 cars.
Blue Planet, a California company, is focused on the conversion of CO2 emissions from large emitters, such as power plants and other industrial plants, into carbonate aggregates. These aggregates can provide a “clean concrete” to the construction and other industries, currently using 54-billion tonnes of aggregate globally. The company estimates that two tonnes of aggregate permanently traps roughly a tonne of carbon dioxide. Widely deployed, the technology could thus potentially make a significant dent in the 38-billion tonnes of global CO2 emissions.
Regenerative agricultural practices are also being developed to sequester CO2 in the soil. Companies like Quebec’s CO2 Solutions, Switzerland’s Climeworks, and Boston-based Indigo Ag are proposing to use CO2 emissions to grow vegetables. Regenerative growing technologies have the advantage of requiring less water and fertilizer, while enhancing agricultural yields. Researchers at the Carbon Management and Sequestration Center at Ohio State University estimate that the technology could capture six billion tonnes of CO2 per year.
Other neglected solutions are well-established and emission-free. For instance, geothermal energy is abundant and clean. It also does not require storage, nor does it suffer from intermittence like wind and solar energy. Readily deployed, it would be a great help in reining in climate change.
Most of these technologies, however, need complementary financial innovations to scale-up and have a significant impact. In the case of farmers wanting to use regenerative agriculture, the obstacle is converting their farms to the new technology. This requires upfront investments that most cannot afford, while banks are often cold to the idea of financing new technologies. However, by selling forward carbon credits to companies and individuals who want to reduce their carbon footprint, farmers could access an alternative financing mechanism.
Blue Planet and Carbon Engineering have a similar problem. For Blue Planet, building a plant to produce aggregates requires financing, which in turn requires purchase orders. Such companies would benefit if private contractors bidding on infrastructure projects were required to use a certain quantity of competitively priced “clean rocks” or materials.
Expensive to deploy, and with a long payback, geothermal energy is not an easy sell to individuals and businesses who are generally not expecting to remain owners of their property for the entire payback period. What is needed in this case is for utilities to provide the financing and allow for the straightforward transfer of financial responsibilities to subsequent owners.
For Hydro-Québec, the incentives to finance geothermal projects are magnified by its ability to sell every kilowatt saved outside the province at double the price it is forced to charge locally. An eventual carbon credit obtained for helping to reduce coal electricity generation elsewhere would make it even more attractive.
In sum, all that is required for such technologies to flourish is the creation of the proper conditions.
Our capacity for adaptation should be a source of optimism and hope. Rather than being used to justify a grand, collective plan to curb businesses, the fight against climate change should focus on the responsibility of consumers in creating global warming, and the opportunity to allow entrepreneurs to put their skills and their intelligence to use to offer consumers solutions.
Luc Vallée is Chief Operating Officer & Chief Economist at the MEI. The views reflected in this op-ed are his own.