The Exchanges

Q Okay. All right, so then what's the second category?

A The second category, I think, is mitigative CCS, so you're avoiding emissions rather than removing them from the atmosphere, but on processes that we don't have other alternatives for. This is also one of these places where you can have a lot of arguments about what Constitutes an alternative. But I think things like mitigating process emissions from cement plants fall into this category. You know, you can reduce the amount of cement that you're using. We can come up with slightly different formulations for concrete that are less cement intensive, those types of things. But fundamentally, we're going to keep using cement in ways that are very, very difficult to imagine moving beyond. And cement, just the process of making it fundamentally results in CO₂ emissions, even if you did full energy switching, efficiency, all that kind of thing. Basically you're cooking limestone that drives off CO two. You've got to do something with that CO two. So this is one of those cases where unless you really get rid of cement or come up with something completely different that fulfills the same societal function, there's not really an alternative to having CO two emissions from that process. And therefore it's really hard to think about something alternative to a carbon capture and storage process. People talk about alternative chemistries, those kinds of things, but you know, I'm a civil engi…

AI assessment note: “The second category, I think, is mitigative CCS”

Q thinking about prioritization? What are good uses of CCS and bad, and so on? So I want to tease that out together, and we can maybe start by, I thought, your frame of the four different Uses of CCS is a good way to start. So why don't you walk us through sort of like one of the four things you can do when you are capturing and sequestering CO₂?

A Yeah, absolutely. And I think one of the things that gets exciting about this is that I can even convince myself that there are different categories or subcategories, but broadly speaking, I think the first category and the one that we talk about the most is CCS applied to things where we really do have other solutions, and for the most part, that's basically fossil CCS. There's Some things I think you can argue that are maybe not super well-suited to alternatives at this point, but for the most part, fossil CCS applied to, you know, a power plant that's using a fossil fuel or a refinery or something like that is kind of a way to deploy CCS to mitigate emissions in a way that could be substituted by something different. In practice, because this is mostly fossil stuff, I think that ends up looking a lot like lifespan extension or some way to Keep using fossil fuels into a decarbonized future. That sounds, I think, maybe a little bit more aggressively judgy than I intended, because I do come down pretty hard on the notion that we need to phase out fossil fuels, but it doesn't necessarily mean that there are no circumstances where we would want to be able to use fossil fuels for a transition or for providing basic energy services or something like that. So it's, it's a preservationist approach that's not necessarily always 100% of the time bad, but the net effect is to enable us …

AI assessment note: “the first category and the one that we talk about the most is CCS applied”

Q to, like, be perfect with regard to what these credits count toward. And so, for example, in this distinction between your third and fourth category of, like, Offsetting somebody's emissions versus, uh, getting rid of residual emissions in the, in the atmosphere. Like, is that not just a, a luxury distinction that we should have in 2040? Or does it have, do you think it has like real utility today?

A No, I think it has real utility today. I'm sympathetic to that argument. I mean, I've been buying CDR credits for four or five years at this point, and like, I'm not saying that I'm net zero or anything like that. It's purely just sort of an investment in scaling some of this stuff to see how it goes. But, I think it is actually incredibly important to think about these things now as opposed to later, because right now, basically, the CDR industry doesn't exist as such. There are emerging companies, there are some tax credit structures, those kinds of things, but what we decide about governance now, I think, is what we have as governance in 2040, where it really starts to become important. I agree with you that we're not going to get anywhere close to these distinctions actually mattering physically for a long time, but in terms of What we set up, what kinds of liabilities we're creating, and what kinds of investments, capital structures, you know, basically like power structures that we're creating at this point. It's really easy to adjust those before they exist. Once you've created something that is incredibly, incredibly predicated on a specific market structure, it's really hard to change that. I think where it becomes incredibly important, actually, is just in this In this context of having something that's purely for profit and purely potentially based on compensatory CD…

AI assessment note: “No, I think it has real utility today.”

Q category to add point source capture where there's probably, there's not currently a good alternative category three, do carbon removal, um, use it to compensate for somebody's continued emissions. Category four, do carbon removal, period, and don't use it to compensate, right? So how do you think about how much of each of these things we kind of want to be doing, and how do we think about prioritizing them?

A Yeah, no, I think it's a really good question, and this is also an interesting question in the context of the compensatory removals, where I think there are some things that you do kind of have to do, and some things that you don't have to do, so there's probably a sub-distinction there, too. Nitrous oxide emissions from agriculture are kind of the classic one of Really, really hard to get rid of and kind of the basis of a lot of the food system that allows us to have a population the size that it is. So getting rid of that is not super, uh, probable. Their compensatory emissions actually do probably fall into a kind of higher priority category than like, you know, compensatory emissions because I feel like not upgrading my natural gas fired furnace or something like that. Um, and so I think when we think about priorities, really recognizing that there's Not just social license questions about a lot of this, but actually resource constraint questions starts to guide how that conversation goes. With CDR in particular, I think we would do well to really recognize this as essentially a depletable resource in some ways. You know, there's an amount of CO₂ in the atmosphere that means we're not going to run out anytime, you know, in the foreseeable future. Yeah, exactly. But because it's energy intensive, land intensive, those types of things, like you actually can use it up. And so …

AI assessment note: “Nitrous oxide emissions from agriculture are kind of the classic one of Really, really hard”

Q removing residual emissions. It doesn't do that, because at the end of the day, you're still going to combust your jet fuel, and it's going to get re-released. So any of the first three categories, um, And does the scale of the need for some alternative to today's jet fuel affect your thinking a little bit about how we capture, how, what kind of COT we capture and from where?

A Not really, because I think mitigative COT capture still ends up having an atmospheric burden, even if it's used in sin fuels. Like, who gets the benefit of having captured it in the first place is maybe an open question in some of these. There's some really interesting, uh, Concerns about double counting and so on in those circumstances. But, like, that CO₂ ultimately is still a contribution to atmospheric levels at the end of the day, whether it's because of the plant or because of the jet fuel, you know. So it actually is kind of a, it's a one plus zero instead of a zero plus zero kind of equation if you're looking at something like direct air capture for utilization that results in re-release. So I think that it does actually matter quite a bit. We don't really have the structures in place to ensure that that Accounting is really happening, and looking at some of the project announcements or ideas that I've seen where both ends of the spectrum are kind of claiming the, the mitigation is challenging, especially because then you start to get into people saying, well, this is also an avoidance offset credit because otherwise it would have been fossil jet fuel in addition. You end up sometimes with, like, three credits for, you know, not having actually prevented that CO₂ from reaching the atmosphere. So those Those kinds of things I think do actually really matter when we talk…

AI assessment note: “Not really, because I think mitigative COT capture still ends up having an atmospheric burden”

Q point being, you're an airline and you sign, you, you sign up for a 100,000 tons of carbon removal from direct air. Capture plant. What is it that you're doing? Are you crediting that 100,000 tons against your ongoing emissions? And if so, it falls into one of these categories and not the other. Right. And I think that's actually like, uh, Not a well understood distinction at this point.

A No, for sure. And it's interesting too, because I think the more that, so to back up a little bit, CDR is something that kind of doesn't exist yet as an industry or as a sector. And I think one of the things that starts to get really important is how we actually think about institutionalizing a lot of this stuff and what we decide about some of the governance questions here. Because yeah, in a situation where it's entirely a liability model, so I can purchase a unit of CRR CDR and apply that to whatever I choose to, and maybe that's setting myself up to be in a regulated context at some point where I'm going to be told I have to actually show up with a certain number of credits or something like that. That fundamentally gives me as a buyer the right to prioritize CDR applications, which is, I think, extra interesting in the context of CDR as a pretty limited resource. This is an incredibly energy intensive thing to do for the most part across different ways that you do it. It's land intensive in many cases. It's It's potentially pretty water intensive in some cases. So there's a huge amount of resource allocation that goes into this that means that you can't actually just do infinite CDR, even if it were cheap. And so by saying, like, I get to buy a CDR and apply it to something, that lets me decide what's important. And like you're saying, if we do actually end up in a situati…

AI assessment note: “in a situation where it's entirely a liability model, so I can purchase a unit”