Our work in Energy
Accelerating the net-zero carbon transition.
A working thesis as we seek to understand and build in this area.
Areas for venture creation:
Carbon neutral fuels
Nature has utilised CO2 since the evolution of photosynthesis, and yet all we seem to be able to do is produce it. Just imagine a world where CO2 is not a waste but a resource…
But the question remains, what should we make if we could transform CO2 or other “wastes”? Pursue synthesising petrochemicals? Or are there alternative compounds with superior properties? The area of carbon neutral fuels is like a battleground of different molecules vying for supremacy. Many arguments for the strengths of a particular fuel seem to be relatively narrow, giving too much focus on a single metric e.g. energy density, and do not offer a systematic analysis of the product space from a market-based, transformational and technological perspective.
The Planet Positive Economy
In order to avoid the catastrophic effects of climate change, radical changes to human activity are required.
The economy is one of the main drivers of human behaviour and activity. In the current economy, economic actors are incentivised to extract natural and social capital, in exchange for money. Little or no consideration is given to the side-effects (the positive and negative externalities) of extraction, production and consumption. However, the world’s resources are finite and therefore the extractive model of our economy is unsustainable. In other words, we are failing to “stay within our doughnut”.
On the other side of the coin, an economic system is perhaps the most powerful lever for systemic change. Resource allocation dictates which processes do and do not take place, and indirectly, what we value as a society.
How might we go about creating a planet-positive economy? We’re developing a number of ventures in this opportunity area and are currently recruiting individuals rfrom a braod array of different backgrounds to join as co-founders – more on this opportunity here.
Although the most effective way to eliminate carbon emissions would be to switch the entire energy system to solar and wind energy, huge quantities of hydrocarbons have already been discovered and will likely continue to be used as an energy source for at least the next 20 years. However, the IPCC estimates that, to meet climate change targets, only a small fraction of the world’s oil and gas reserves can be exploited.
Instead of trying to solve this problem by displacing fossil fuel energy sources, we urgently need to take a first principles approach to rethink how we extract, process, and utilise hydrocarbons to avoid their climate impact. Our aim is to find new ways to use discovered hydrocarbons by processing them in the well or reservoir so that only a clean energy vector is produced to surface, thereby leaving the environmentally damaging constituents underground.
The aim is to find ways to extract pure electricity, hydrogen, ammonia, or other carbon-free fractions from oil and gas reservoirs. In creating a genuine transition pathway for oil and gas majors it will allow them to fully decarbonise, not just their operations, but their products, within a decade or less. This would ameliorate not just carbon emissions, but methane emissions too.
For a detailed deep-dive into this opportunity area visit our blog post What to do with all the oil and gas?
We are currently recruiting individuals with broad technical knowledge of chemical, biochemical or environmental engineering to join us and launch companies tackling this challenge area – more on this opportunity here.
Carbon negative operations
Climate Change has already happened
The global climate has already risen in temperature by close to 1ºC so far: even if we stopped all economic activity, it’s likely that temperatures would continue to rise. We’ve only made minor progress to transition away from carbon-emitting sources and even climate champions such as Germany have decided to continue burning coal until 2038 to protect the jobs of miners.
As a result, the key role for scientific venture to play will be investing in companies that will help society limit the impact of climate change, and adapt to the harsher climate that has the potential to markedly disrupt the global socioeconomic system.
Attacking from all fronts
One of the overriding issues surrounding how we produce and consume energy is the dogmatism between stakeholders at every level over which technology should “win”. However, it’s our position that there is no panacea technology that will fix everything—rather, the transition will be from a mix of hydrocarbons to a mix of renewables and low-carbon fuels. The true winners in this space will be the companies that enable the transition across various stages of the value chain.
We’ve grouped these across four themes that each tackle a key component of the emerging climate crisis.
Decarbonisation of the world’s energy supply is essential. From the coal 🙁 being burned for power and process heat, the natural gas heating our hot water to almost every form of transport.
Electrochemical storage is a key enabling technology to replace internal combustion engines with electric motors and improve flexibility of the grid. However, the improvement in cell performance driven by electronic devices is slow, due in part to a lack of meaningful breakthroughs in battery technology.
Portfolio company Holy Grail are working to debottleneck materials science research with the vision to produce batteries that can compete with hydrocarbons on every performance metric. They’ll also produce their own batteries so that they’re readily added into the global supply chain, avoiding the mistakes of past technology-push approaches in battery tech.
One of the biggest impacts in reducing carbon emissions in the past few decades has been the simple act of switching from incandescent to LED lighting. Analogously, improving building insulation is a key driver in increasing energy efficiency, but selecting the wrong materials can result in lower development yields at best, and tragedy at worst.
Portfolio company Thermulon have developed a novel process to produce high-performance insulation that’s carbon-negative and incombustible.
Heat is essential to many of the processes we use to produce power, synthesise industrial products and even baking bread. The process is inherently inefficient, with 51% of the input energy lost. Waste heat recovery offers the opportunity to use that wasted energy for other applications, but the current state of the art requires large capital investment and requires high-grade heat.
Eltiera has developed a way of transforming that waste heat into electricity, with no moving parts and a compact design. Their advantage comes from designing a product that doesn’t require high-risk materials science R&D, but instead on an application that can readily be manufactured.
This is a politically-charged issue, but with the damage already done to the composition of the Earth’s atmosphere, an engineered effort to repair it is necessary. Many have made the argument that it isn’t the place of humankind to engage in engineering the Earth’s atmosphere—but we already have been for centuries, albeit unintentionally.
Concerns have also been raised that repairing the climate will permit the worst polluters to continue doing so, especially in the context of a carbon tax. Whilst this may have been a valid concern in decades past, global inaction has made it imperative to take all available options as soon as possible, without dependency, and as a matter of existential importance. But perhaps more importantly, if we can find ways of making environmental mitigation a scalable, viral and above all profitable activity, we might lessen the immediate burden placed on altruistic behaviour change.
Currently the only approach that has found political and commercial acceptance is direct air capture of CO2. Despite significant funding into DAC, producing synthetic fuels in this way is yet to be proven to be scalable and is only profitable where it is used to enhance oil recovery. Let that sink in – the only profitable implementation of carbon capture leads to greater carbon output.
Our position is that repairing the climate represents an arbitrage opportunity which can be exploited through traditional industries such as agriculture and energy. Creating or repairing ecosystems in a self-replicating or extremely scalable way can be the basis of turning low-value assets into high value assets. Barren stretches of land, sky and sea become fertile, high-yielding production sites, in many cases subsidised by governments eager to increase growth, create a national competitive advantage, improve wellbeing and to hit carbon targets simultaneously: the macroeconomic holy grail.
The climate change that has already occurred threatens global populations balancing mechanisms that have meant that areas are safe from flooding, fires and other natural phenomena are being lost.
Similar to how the Thames Barrier was installed to prevent the risk of tidal surges flooding London, technology will be vital to ensure that humanity can adapt to a more hostile world.
A Sustainable Future
With the exception of a mass depopulation event or economic retreat, we believe that searching for opportunities within these lenses represents the best possible chance of controlling the risk of human extinction due to climate change.