Xpansiv and Puro.earth Partner to Scale Carbon Removal Credits Market

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Puro.earth and Xpansiv to partner to expand the market for carbon removal credits and strengthen net zero programs. 

Nasdaq-backed Puro.earth is the world’s leading carbon crediting platform for engineered carbon removals (CDR) while Xpansiv is the dominant market infrastructure for the global energy transition. 

A Giant Merge to Scale Carbon Removals 

Efforts have been made in ramping up the carbon removals credit market. This very recent tandem between the two leading market platforms marks a significant development in the space. 

The partnership makes Puro.earth CO2 Removal Certificates (CORCs) added to the list for trading on Xpansiv spot marketplace CBL. The market is the largest spot exchange for trading voluntary carbon credits, renewable energy certificates (REC), and other environmental commodities.

Puro.earth’s robust, diverse supplier base provides buyers with a great source of quality carbon removal credits. Its platform currently delivers carbon removal services to some of the world’s giant corporations, such as Shopify and Microsoft.

Puro.earth launched Puro Registry, a public registry dedicated to CORCs last year.

Xpansiv’s CBL offers hundreds of market participants transacting on its centralized and transparent spot exchange and post-trade platform. Xpansiv is the leading provider of registry infrastructure for energy, power, and environmental markets.

Remarking on their partnership, Xpansiv said that participants are eager to include carbon removal credits in their portfolios. 

Highlighting the importance of their collaboration with Xpansiv, Puro.earth’s CEO Antti Vihavainen said that scaling up the market for carbon removal credits is essential in the private sector’s net zero programs. Vihavainen further noted that 

“CBL’s central position in the carbon markets will be critical in enhancing transparent price discovery and liquidity formation, enabling participants to engage with greater certainty and confidence.”

Carbon removals are becoming more important in companies’ decarbonization strategies, particularly for the hard-to-abate sectors of steel and cement.

Credits for Removing Carbon for Good

Puro.earth’s guiding principle is to create undisputable methodologies for engineered carbon removals. The platform’s ecosystem consists of more than 110 suppliers of carbon CORCs with 600 firms in preparation for getting certified.  

Engineered carbon removals are also known as negative emissions technologies. They refer to a set of technologies and methods designed to actively remove CO2 from the atmosphere. Unlike natural carbon removal processes, engineered carbon removals are man-made processes to mitigate the impacts of climate change.

Last year, Nasdaq launched three carbon removal price indexes based on Puro.earth CORCs.

Puro.earth Standard establishes carbon credit methodologies for processes that remove CO2 from the atmosphere for at least 100 years. The company then certifies suppliers that run those processes and issues digital, tradable carbon removal credits into Puro Registry.

The company has recently updated its Terrestrial Storage of Biomass methodology and is reopened for more comments or insights. Initiatives that may certify under this program prevent the escape of carbon from the stored biomass back into the atmosphere. 

The partnership between Xpansiv and Puro.earth plays a crucial role in enhancing transparent price discovery and liquidity formation, enabling a more sustainable and confident engagement with carbon removal efforts and credits.

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Turning CO2 Into SAF Via “Industrial Photosynthesis”

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Breaking new ground in the aviation industry, the startup Twelve is set to revolutionize sustainable aviation fuel (SAF) production in the U.S. It recently broke ground on a commercial-scale facility in Washington state, which it claims will be the country’s first to create SAF from carbon dioxide.

The groundbreaking event, attended by Washington Gov. Jay Inslee, marks a historical milestone for an aviation industry under pressure to decarbonize.

Twelve began producing jet fuel in a Berkeley, California lab in 2021 using electricity, water, and CO2. The company refers to this product as E-Jet, a potential replacement for fossil-based fuel that could significantly reduce airlines’ carbon emissions.

Now, the California-based startup is scaling up efforts to produce more of this cleaner fuel at its commercial-scale facility in Moses Lake, Washington. If operations begin in 2024, the facility will be the first of its kind to convert CO2 into SAF.

Major corporations such as Alaska Airlines, Microsoft, and Shopify have recently signed deals to buy millions of dollars of SAF from Twelve’s new facility. 

Cutting Emissions By 90% 

Last year, aviation was responsible for 2% of global GHG emissions and is growing faster than any other transport modes. This emission will continue rising as more people and airplanes fly. 

In 2022, major U.S. airlines have burned over 17 billion gallons of jet fuel. Only a very small fraction of this consumption, below 0.1% or almost 16 million gallons was SAF.

So cutting further down the sector’s pollution is crucial in the fight against climate change. But substituting the planet-warming kerosene with SAF poses significant challenges. 

Global fuel companies and startups have been finding solutions to make it possible to fully replace fossil-based kerosene. And they are supported by the Biden administration through the Inflation Reduction Act. 

The climate law offers tax credits to producers of clean alternative fuels like SAF with $300 million in grants. The goal is to grow the supply of these fuels to 3 billion gallons annually by 2030.  

Twelve aims to produce 40,000 gallons of E-Jet per year before scaling up production by as much as 10x within the first 5 years of operation, said the chief officer Ram Ramprasad. The startup also plans to construct much larger facilities.

The company said that SAF can reduce the carbon emissions of airplanes by up to 90% versus fossil-based kerosene. Though using E-Jet still emits carbon, it’s much less than petroleum-based fuels. That’s because it recycles CO2 from the wastes of refineries and mills, or captured directly from the air. 

Twelve’s E-Jet From “Industrial Photosynthesis”

Twelve is using a unique method to transform CO2 into juice for jet engines in a process called “industrial photosynthesis”.

The process is pretty much the same as what plants do during photosynthesis. The difference is that Twelve’s electrochemical reactor named Opus performs photosynthesis.  

Opus takes water and CO2 and changes them into new chemicals, materials, or fuels using renewable energy. It splits CO2 molecules into carbon monoxide while in a separate electrolyzer, water molecules break down into hydrogen and oxygen. The result of these processes is called ​“syngas.”

The team is using a multistep reaction process called the Fischer-Tropsch to transform the gas into alternative jet fuel.

The company sources ​“waste” CO2 from industrial facilities. Its modular reactor can be installed in any industrial system, with a “plug-n-play” design.

According to Twelve, they can cut up to 10% of global emissions through Opus. And that’s possible by transforming supply chains from running on fossil fuels to running on waste or captured CO2.

Twelve Carbon Transformation Technology

Other startups are also using carbon to make synthetic jet fuel. For instance, LanzaJet, a spinoff of LanzaTech, is recycling municipal solid wastes, agricultural biomass and residues to make SAF. 

The company, which turned public this year, is constructing what it claims is the first ​“ethanol-based alcohol-to-jet” SAF production. The facility, which is due to finish this year, will make 10 million gallons of sustainable aviation fuel each year.

Air Company, another startup based in New York, is also working in the same space. Its innovative carbon conversion technology combines CO2 and hydrogen to make oily liquids suitable for making SAF. 

The company also makes carbon-negative alcohols and consumer products out of thin air. With its pioneer carbon technology, Air Company made the world’s first alcoholic beverage directly from CO2, Air Vodka.

The Key Challenge to Scaling SAF 

Right now, almost all of the country’s SAF supply is from used cooking oil and animal fats, and scarce feedstocks. This is why Twelve’s carbon transformation technology needs to scale up rapidly to supply the much-needed SAF.

In 2022, SAF production tripled to about 300 million liters or 240,000 tonnes, according to the International Air Transport Association. If renewable energy production hits 69 billion liters by 2028 as projected, the forecast to 100 billion liters (80 million tonnes) by 2030 is possible. If only 30% of that production is achieved, the industry can still have 30 billion liters (24 million tonnes) of SAF by the same year.

To produce E-Jet at its commercial plant, Twelve will first source CO2 from an ethanol refinery in neighboring Oregon. Then it will later get more CO2 supply from pulp and paper mills in Washington. 

The biggest challenge the company has in ramping up its SAF plants is the availability of power. They’re aiming to build their next facility in the American Corn Belt where ethanol facilities and wind farms abound. 

Finding sites where they can source CO2 and access renewable power is critical to scaling up sustainable aviation fuel production. 

Still, by leading the charge in developing cleaner and greener solutions through its innovative industrial photosynthesis, Twelve’s method is showing immense potential in cutting aviation’s carbon emissions. With the growing demand for cleaner fuels, plus government support, flying will be more sustainable in the future.

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Alibaba Cuts Carbon Emissions By 13%, Reveals So-Called Scope 3+

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In a bold stride towards a greener future, Chinese e-commerce titan Alibaba has successfully slashed its net carbon emissions from direct operations by an impressive 13% in the past financial year. This significant reduction is a part of Alibaba’s ambitious goal to achieve carbon neutrality by 2030.

The retail behemoth unveiled this remarkable achievement in its 2023 Environmental, Social, and Governance (ESG) report. The report also highlighted Alibaba’s groundbreaking progress towards its ambitious Scope 3+ goal, which aims to eliminate a whopping 1.5 gigatons of carbon emissions across its digital ecosystem by 2035. This marks the first time the company has reported on this pioneering sustainability effort.

Highlighting this milestone, Alibaba’s outgoing CEO and Chairman, Daniel Zhang Yong noted in the report:

“Despite challenges in the macro environment, geopolitical uncertainties in the post-pandemic era, and new trade-offs between sustainable development and economic growth, we achieved notable progress in our ESG initiatives.”

And one of these achievements is the CO2 emission reduction of almost 23 million metric tons throughout the value chain. This includes Scope 3 emissions. 

Alibaba’s Carbon Emissions and Reductions

In 2021, the Hangzhou-based company made three climate pledges as follows: 

Decarbonize operations (Scopes 1 and 2): achieve carbon neutrality in own operations by 2030.
Green the value chain (Scope 3): cut emission intensity by 50% from 2020 levels in collaboration with value chain partners. Alibaba Cloud will reach Scope 3 carbon neutrality by the same year. 
Enable a low-carbon circular digital ecosystem (Scope 3+): to achieve 1.5 gigatons of carbon reduction over 15 years across the digital ecosystem. Alibaba will leverage its digital platforms to attract more participation from stakeholders in reducing emissions. 

In its 2023 financial year, Alibaba took huge steps toward meeting these targets. 

As shown in the charts, the e-commerce giant emitted around 4.7 million metric tons (Mt) of CO2 equivalent, down 13% from the previous year. By cutting 1.4 million Mt of CO2e with clean energy and smart energy management, carbon reduction increased 129%. 

Alibaba Net Carbon Emissions and Reductions

Alibaba was also able to decrease its Scope 3 emissions by 400,000 MtCO2e through various measures. These include digital optimization, energy transition in logistics, more energy-efficient data centers, and adoption of low-carbon business traveling.

For instance, logistics subsidiary Cainiao has reduced packaging materials by 184,000 tons in 2023 by recycling used packages. Cainiao urged consumers to reuse cardboard boxes at pick-up points resulting in 23 million boxes recycled at Cainiao Posts.

Alibaba teamed up with Nike to do door-to-door recycling across thirty Cainiao campus stations nationwide in China.  

Combining these efforts with the company’s projects on carbon removal and carbon credits, its Scope 3 carbon intensity dropped by almost 6%. Alibaba focuses on supporting nature-based climate solutions.

The So-called Scope 3+

What makes 2023 a groundbreaking year for the Chinese company is the introduction of its initiative called Scope 3+ results. This new effort goes beyond Scopes 1, 2, and 3, which reduced a total of around 23 million MtCO2e.

Under its so-called Scope 3+, Alibaba introduced a group-level carbon ledger, Carbon88, which encourages consumers to adopt low-carbon behaviors on the company’s platforms. More than 187 million users took part in CO2 emission reduction efforts through the carbon ledger program.  

Carbon88 allows users to show the actions they’re taking to reduce their carbon footprint. These include everything from bringing their own cups to using reusable bags.

Similarly, Amap, Alibaba’s navigation platform, has seen over 30 million people opting for low-carbon travel options like walking. This led to a reduction of 215,000 MtCO2e. Moreover, the company’s food delivery platform, Ele.me, helped save resources by allowing users to opt out of cutlery on over 1.4 billion orders. 

Scope 3+ basically refers to a low-carbon circular digital ecosystem with broader cooperation from stakeholders.

A Green Cloud

Alibaba’s cloud computing subsidiary also significantly contributes to its climate goals. The report said that the proportion of clean electricity used in its self-built data centers in China increased from 21% in 2022 to an impressive 54% in 2023.

This remarkable achievement is due to the improved implementation of energy-saving technologies such as liquid-cooling server technology and power management optimization. As a result, total power usage was down to 1.215 in the period from 1.247 a year earlier. 

Alibaba Cloud’s efforts to replace traditional IT with cleaner and greener cloud computing have boosted corporate users’ efficiency. It also reduced its emissions, avoiding a significant 85% of CO2 emissions, as Carbon Trust reported.

Moreover, the cloud’s AI-driven sustainability platform has assisted thousands of enterprises worldwide in monitoring, analyzing, and optimizing their CO2 emissions. 

Overall, Alibaba Cloud realized over 1 million MtCO2e of emission reduction in the company’s own operations (Scopes 1 & 2) and 0.4 million MtCO2e throughout its value chain (Scope 3).

These results stated in its ESG report emphasize Alibaba’s commitment to environmental responsibility. It sets a shining example for other companies to follow in their quest for a greener future. 

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Germany Multination Thyssenkrupp Wins EU Nod for $2.2B Green Steel Subsidy

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Thyssenkrupp AG got the European Union’s approval for a 2 billion euros, or about $2.3 billion, package of state subsidies from the German government for its proposed green steel production.

Currently, Thyssenkrupp Steel division is responsible for 2.5% of Germany’s total carbon emissions. The leading German metals, engineering, and manufacturing company aims to reduce such footprint by producing climate-friendly steel at their Duisburg site. 

Green Deal is Green Steel 

Big businesses across Europe are turning to governments for large subsidies to construct green production facilities. This is in line with the EU’s “Green Deal” that seeks to take a lead in the clean technology sector. 

The bloc hopes to keep pace with the massive aid by other countries to companies to make their businesses green. And green steel is a key driver of a Net Zero industry in the region. 

The steel industry is raking in hundreds of billions of dollars in revenue annually but at the cost of the planet. The industry accounts for up to 9% of global carbon emissions due to its high reliance on coal to make steel. 

The industry is, in fact, the largest emitting manufacturing sector. Cutting its huge footprint is very expensive but using clean technology to make green steel can help lower the cost. 

Green steel production usually involves hydrogen to purify iron ore pellets and melts it to make steel in electric furnaces. This clean technology basically replaces coal used in powering blast furnaces that releases over one ton of CO2 for every ton of steel. 

ThyssenKrupp Steel has tested the viability of this green steel technology as part of its climate strategy. The German industrial company’s goal is to make steel production carbon-neutral by 2045.  

The firm aims to reduce carbon emissions of steel production across three sources – Scope 1, 2, and 3 – by at least 90% by 2050. In the short term, Thyssenkrupp Steel plans to cut Scope 1 and 2 emissions by 30% by 2030 versus 2018 levels. 

Hydrogen for Green Steel Production

A big part of achieving those goals is the construction of a hydrogen-powered direct reduction (DR) plant at Thyssenkrupp’s Duisburg site. It’s a revolutionary concept with a capacity of 2.5 million metric tons of directly reduced iron (DRI). The company calls it “tkH2Steel”, which can reduce over 3.5 million metric tons of CO2. 

Contrary to conventional blast furnaces, DR plants don’t produce hot metal but solid sponge iron, aka “direct reduced iron”. DRI needs further melting to make high-quality steel. 

Thyssenkrupp Steel has been working on this technology to produce green steel. In March this year, the company awarded a contract worth billions of euros to SMS group, a company from North Rhine-Westphalia, for a direct reduction plant. The project marks one of the world’s largest industrial decarbonization initiatives in the industry. 

The project is a groundbreaking initiative for Germany’s largest steelmaker – replacing carbon-intensive steel production with clean technology using hydrogen. The company can continue to boil steel like in the past using proven processes but use hydrogen instead of coal.

To date, the company’s Duisburg production site emits about 20 million metric tons of CO2 a year with its coal-based hot iron production using blast furnaces. With hydrogen-powered direct reduction plants, Thyssenkrupp Steel can significantly slash its emissions and produce carbon-neutral steel. The giant steelmaker plans to avoid as much as 6 million metric tons of CO2 by 2030.

The 2 billion euros subsidy approved by the EU will help Thyssenkrupp achieve its green steel production targets. 

Funding Steel Decarbonization in Europe

The subsidy package is a combination of direct grants and a conditional payment to support the steelmaker’s decarbonization plan and ramp up its hydrogen uptake. 

The EU and Germany have agreed to give Thyssenkrupp financial aid in June. The funding includes around 1.3 billion euros from the federal government and 700 euros from North Rhine-Westphalia’s state government.

The bloc also approved a separate 850 million euros subsidy in France to help fund ArcelorMittal SA‘s steel decarbonization plans.

In Sweden, a green steel startup secured 190 million euros from private investors to start building its green hydrogen-powered steel plant in Boden.

The target date of Thyssenkrupp’s green steel production at its hydrogen-powered DRI plant is the end of 2026. This groundbreaking project winning over European government support shows a business case for the Green Deal’s investment in clean technology.

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Bill Gates Backs Stealth Startup with $91M for Hydrogen Revolution

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A Denver-based startup, Koloma, received $91 million in funding from Bill Gates and other investors to drill natural hydrogen in the U.S. Midwest, a venture that can ramp up the clean energy revolution. 

The hydrogen startup has plans to avail incentives both from the U.S. Bipartisan Infrastructure Law and the Inflation Reduction Act, particularly the hydrogen production tax credit (PTC).

Natural Hydrogen: The Next Global Gold Rush? 

The knowledge of the existence of naturally occuring hydrogen has been around for centuries but is not well understood. With the recent revelation by Koloma, this could be about to change. 

Natural hydrogen, also called gold or white hydrogen, has made headlines as a potential new renewable energy source. It differs from other types of hydrogen in that it’s a primary source of energy like fossil fuels but carbon-free.

Koloma believes that it can tap into a regenerating supply of underground hydrogen through a process called serpentinization. The process breaks down iron- and magnesium-based minerals under the earth’s surface deep in the seafloor to produce hydrogen-rich fluids and other minerals. 

This process of natural hydrogen production can deliver around 23 million tonnes of H2 each year, Koloma said. This amount is equal to almost a quarter of current total global hydrogen demand. 

The company refers to this regenerative gas geologic hydrogen with clean and environmentally-friendly attributes. Coming from iron-rich source rocks and as a primary energy source, geologic hydrogen requires no external energy and water inputs. It also has a low carbon footprint compared to electrolysis and results in minimal surface disruption. 

Koloma’s Geologic Hydrogen Production

SMR – Steam methane reforming, CCS – Carbon capture and sequestration Source: Koloma website

Highlighting these facts about carbon-free hydrogen production, Koloma’s co-founder and CTO, Tom Darrah, said that:

“It’s [Hydrogen] on every continent… The scale of how much there is, is profound.”

Darrah is an Earth sciences professor and an expert in extracting hydrogen who has 16 patents involving H2 extraction. One of them includes the use of AI-assisted laser imaging and satellites to assess sites potentially storing natural hydrogen.

The hydrogen startup analyzes samples from its Midwestern wells in Darrah’s laboratory at the Ohio State University. The tests will help reveal the sites with the best H2 volume and purity.

Koloma, however, didn’t disclose the exact location of their wells and the dates of their commercialization. 

From Secret Mode to Revolutionary Revelation

Koloma, founded in 2021, has been operating in stealth or secret mode but revealed itself in an interview with Forbes magazine. 

The $91 million investment made Koloma the most-funded company in the space. It got the funds from Bill Gates’ Breakthrough Energy Ventures and other big climate investors Energy Impact Partners, Evōk Innovations, Prelude Ventures, and Piva Capital.

The startup didn’t say how much of the funds came from the Microsoft founder Bill Gates. The billionaire himself is a promoter of hydrogen, believing that it is the ‘Swiss Army knife’ of renewable sources. 

The company’s revelation that there are vast reserves of clean, regenerative geologic hydrogen beneath the earth’s surface can help revolutionize the energy transition. It could have never been more timely as the world tackles the climate crisis. 

Using hydrogen though comes with some challenges because of its flammable nature. But when used in fuel cells, H2 can produce clean energy with only water as a byproduct. 

The gas can be used as a carbon-free fuel for vehicles, power generators, and other industrial applications. In fact, Toyota has plans to sell 200,000 hydrogen-powered vehicles by 2030. 

Koloma believes that geologic hydrogen will be a cheaper and less energy-intensive alternative to other types of hydrogen. Though the hydrogen company didn’t reveal its commercial operations, the startup can earn tens of billions of dollars in revenue if its venture becomes successful.  

The $1 Trillion Market by 2050 

Currently, the global hydrogen market is worth over $120 billion, with 100 million metric tons in annual consumption volume. Industry experts think that naturally-occuring geologic hydrogen can potentially ditch fossil fuels. 

According to Goldman Sachs, the market will more than double to $250 billion by 2030 and worth $1 trillion by 2050. This is crucial as hydrogen is becoming an increasingly important piece of the net zero emissions by 2050 puzzle. 

According to the International Energy Agency, strong hydrogen demand growth and the adoption of cleaner technologies for its production will enable H2 and H2-based fuels to have a significant contribution in its Net Zero Emissions Scenario. 

Emissions Reduction by Mitigation Measure in the Net Zero Scenario, 2021-2050

Source: IEA website

Green hydrogen is dubbed as the energy of the future and it begins this 2023 as subsidies start pouring in. 

In the U.S., the government allocated over $9 billion for clean hydrogen projects in the 2021 Bipartisan Infrastructure Law. Plus, President Biden’s Inflation Reduction Act provides a tax credit of $3/kilo for zero-carbon fuel which geologic hydrogen meets. Koloma will apply for subsidies under both programs. 

The EU’s Carbon Contracts for Difference (CCfD) also subsidizes green hydrogen through its Innovation Fund. The UK also has a similar CfD subsidy scheme for clean hydrogen production. 

Germany, Canada, and India also have their own programs to make hydrogen a viable sector of the clean energy market. 

The Bill Gates-backed startup said it will start commercial operations when demand for hydrogen ramps up. And this seems to be near starting this year. Through its geologic hydrogen production, Koloma sets the stage for a sustainable future where drilling clean hydrogen is as common as drilling dirty fossil fuels.

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Toyota to Sell 200,000 Hydrogen-Powered Vehicles, Targets China & Europe Market

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Toyota announced that it will focus on rolling out hydrogen-powered vehicles in Europe and China with the aim of selling 200,000 units by 2030. 

This move is a shift in Toyota’s focus, which revealed its plans to commercialize its revolutionary solid-state battery by 2027.

Toyota’s Hydrogen Fuel-Cell vs. Solid-State Battery

The Japanese carmaker unveiled last month that they’re determined to be a world leader in battery EV energy consumption. And then they presented their solid-state battery breakthrough just last week. This announcement stole the show as the company gave a sneak peek into its next-gen battery technology. 

But Toyota’s latest plan on selling hydrogen fuel-cell vehicles outside its home market is yet another revelation. 

The largest carmaker by sales has long placed a huge bet on hydrogen fuel cells as an alternative to fossil fuels. A fuel cell vehicle is also using an electric motor like an EV but it gets power from a fuel stack where hydrogen is stored.

However, Toyota sales of its hydrogen-powered vehicles weren’t a big hit. Since it launched its fuel-cell Mirai in 2014, the company has only sold less than 22,000 hydrogen cars. 

The automaker also sold only over 3,900 fuel cell vehicles in 2022, which is so insignificant in relation to its 9.5 million vehicles in global sales. That’s mainly because of the expensive cost of hydrogen and the lack of infrastructure, particularly the hydrogen fueling stations.

So to bring down the costs of fuel-cell vehicles, Toyota will focus on Europe and China markets where hydrogen demand and production is much higher than Japan. By selling more volume, it can cut down costs by almost half, the company said.

Europe and the US have plans to supply 25 million tons of hydrogen annually by the end of the decade. China aims to produce much more, 40 million tons while Japan targets only 3 million tons by 2030.

Fuel Cells Better for Heavy-Use Vehicles

Transitioning to clean energy calls for greener power sources and hydrogen is dubbed as the energy of the future. But this happens if trillions of dollars – $15 trillion – are invested into this green technology by 2050.

Government subsidy programs announced this year will help ensure that the hydrogen industry will become a large-scale renewable power source. 

While Toyota seeks to increase sales of its fuel cell vehicles outside Japan, the giant carmaker can still work with the Japanese government which highly considers hydrogen as an energy-security alternative. The company can supply local governments fuel cell ambulances, delivery and garbage trucks. 

Toyota says fuel cells are better for longer-range, heavy-use vehicles because of their higher energy density. They predict that the global market for fuel cells will increase 15x from 2020 levels to $35 billion by 2030.

Other market estimates are much higher at more than $43 billion by the same year. 

The automaker has set up a dedicated hydrogen-focused division, the Hydrogen Factory, to expand the application of fuel cell technology. It started operation with more than 1,300 staff. 

They will help Toyota forge more partnerships on hydrogen technology such as its deal with Daimler Truck Holding to merge their truck businesses. Other automakers also plan to sell tens of thousands of hydrogen-powered transports. 

Honda Motor aims annual sales of 60,000 fuel cell vehicles in collaboration with General Motors in 2030.

For Toyota, its decades-old knowledge in developing fuel cell technology is an edge but it can’t ignore China’s big potential for producing hydrogen-powered vehicles, too. 

Still, tapping opportunities abroad brings confidence to the company as asserted by its Chief Technology Officer, Hiroki Nakajima, remarking that:

“This may be a strange way of putting it, but 200,000 is not a big number… We believe this number and more can be achieved.”

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Tesla’s $413M Power Move: Megapacks to Revolutionize Massachusetts’ Energy Grid

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Tesla has signed a contract worth $413 million to install its Megapack battery energy storage in two facilities in Massachusetts for a total capacity of 800 MWh. 

Megapack is a large-scale, lithium-based battery energy storage designed by Tesla to boost the stability of power grids and avoid outages. Each unit boasts a storage capacity of over 3 MWh, enough to power 3,600 homes for an hour.

Tesla’s Battery Energy Storage Systems

Though Tesla’s energy storage segment is much smaller than its automotive business, it has been growing massively. After sustaining consistent growth, it has significantly accelerated and expanded rapidly.

According to Tesla, its energy generation and storage revenues went up 148% year-over-year to $1.5 billion in Q1 2023, representing 6.6% of the company’s total revenues. The company also reported that its battery energy storage systems (BESS) deployment was up 360% year-over-year for the same period. It hit a new quarterly record of 3,889 MWh or almost 4 GWh. 

BESS includes Powerwall (residential), Powerpack (businesses), and Megapack (large-scale commercial and utilities projects) deployment. All three energy storage systems use lithium-ion batteries. 

Tesla Battery Energy Storage Deployed (in MWh)

Source: INSIDEEVs (https://insideevs.com)

Such tremendous growth has been particularly attributed to ramping up Tesla’s Megapack production capacity in its recently built 40 GWh Megafactory in California. The company aims to produce 10,000 Megapacks each year in this factory. 

Earlier this year, Tesla also revealed plans to construct another 40 GWh Megafactory in Shanghai, China to meet the robust demand for its energy storage systems. Construction will start later this year.

The demand in the U.S. alone has been rising sharply, with the most recent deal with Massachusetts. 

Under the contract approved by the Massachusetts Energy Siting Facilities Board, Tesla Megapacks will power two battery energy storage facilities in the state with 218 units. The decision will allow the state to meet 80% of its 1 GWh energy storage deployment target by 2025. The two facilities’ locations and their corresponding energy storage deployment are as follows:

Cranberry Point Energy Storage – 150 MW/300 MWh BESS with ancillary facilities in Carver, will serve the New England region.
Medway Grid – 140 Tesla Megapacks on site, with a substation including a 300 MVA transformer

Megapack was launched in 2019 and first used in California with PG&E’s Moss Landing project. The agreement included over 400 Tesla lithium-ion Megapack batteries for a massive energy storage system of up to 1.2 GWh.

Large-Scale Renewable Energy Solutions

The smaller BESS, Powerpacks, was first deployed on the small island of Nantucket in 2019. The island is about 30 miles off the coast of Massachusetts. Tesla built a 6 MW/48 MWh battery energy storage system in Nantucket with 234 Powerpacks. 

The Powerpack storage can power half the homes on the island for up to 8 hours. To date, Tesla has deployed Powerwalls and Powerpacks at more than 50,000 sites worldwide. 

The recent $413 million contract with Massachusetts is by far the largest Megapack project of Tesla, delivering a total of 800 MWh energy storage capacity. The previous large Megapack project was the Victoria Big Battery, a 212-unit, 350 MW system.

More Than Just an Electric Carmaker

The rising demand for Tesla’s Megapacks signals that there’s a big market for grid-scale battery energy storage solutions. In fact, this market is expected to grow at over 24% rate through 2027.

According to research, the market will grow to over $15 billion in 2027 as shown below. 

What drives this growth in grid-scale energy storage systems is the transition away from fossil fuels to renewable energy sources. Power from renewable sources is attached to microgrids and this stored energy will be provided later to homes, businesses, and utilities.

The surge in the use and future demand for renewable energy will further lead to global grid-scale BESS market growth. As per the International Energy Agency’s estimates, renewables will account for over 90% of global electricity capacity expansion from 2022-2027.

With that, growth in energy storage systems should be quicker in areas where renewables are also growing faster than average. For Tesla Energy, that means its battery energy storage solutions like Megapack have a big room for growth.

This business, along with its solar panel installations, is part of Tesla’s quest for sustainability. All of these operations, including manufacturing EVs, generate carbon credits by avoiding carbon emissions. Selling these credits provided Tesla with billions of dollars in revenue.

The company’s clean energy segment, though it’s not comparable yet with its electric car production, will be one of its large revenue streams.

Megapack, in particular, offers a powerful grid-scale energy storage capacity that can be recharged using clean and renewable energy sources. It helps stabilize the local grid, promote sustainable energy infrastructure, and create a source of power that’s safe for the people and the planet. 

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Fervo Energy’s Breakthrough in Enhanced Geothermal Systems: A Game-Changer for Renewable Energy

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In a significant development for the renewable energy sector, Fervo Energy, a Houston-based startup, has announced a breakthrough in enhanced geothermal system.

The company has successfully demonstrated the commercial viability of its enhanced geothermal system (EGS) pilot, Project Red. This marks a major stride towards the realization of dependable, carbon-free energy sources.

Fervo Energy’s EGS expands the range of sites that can be tapped for geothermal energy. This expansion has been a long-standing goal for the renewable energy industry, with efforts dating back to the 1970s.

The successful demonstration by Fervo Energy is the first instance of EGS being implemented on a commercial scale.

The company recently completed a full-scale, 30-day well test at its Project Red site in northern Nevada. The project was able to generate 3.5 megawatts of electricity, enough to power approximately 2,625 homes simultaneously.

Project Red is set to connect to the grid later this year, supplying power to Google’s data centers and infrastructure throughout Nevada. This initiative is part of a corporate agreement between Fervo Energy and Google signed in 2021 to develop enhanced geothermal systems.

Fervo and Google Team Up for 24/7 Carbon-Free Energy

Back in 2021, Google and clean-energy startup Fervo signed the world’s first corporate agreement to develop a next-generation geothermal power project. This is part of Google’s earlier commitment to use 100% carbon-free energy 24/7 by 2030. This groundbreaking initiative aims to provide an “always-on” carbon-free resource that can reduce the hourly reliance on fossil fuels.

Traditional geothermal already provides carbon-free baseload energy to several power grids. However, due to cost and location constraints, it accounts for a very small percentage of global clean energy production.

This is where the new approach comes in. By using advanced drilling, AI, fiber-optic sensing, and analytics techniques, next-generation geothermal can unlock an entirely new class of resource.

The U.S. Department of Energy has found that with advancements in policy, technology, and procurement, geothermal energy could provide up to 120 GW of generation capacity in the U.S. by 2050.

As part of their agreement, Google is partnering with Fervo to develop AI and machine learning that could boost the productivity of next-generation geothermal and make it more effective at responding to demand.

Google geothermal energy use potential 2030 Source: Google.com

The project brings Google’s data centers in Nevada closer to round-the-clock clean energy. It also acts as a proof-of-concept to show how firm clean energy sources such as next-generation geothermal could eventually help replace carbon-emitting power sources around the world.

The Potential of Enhanced Geothermal Systems

Geothermal energy, often referred to as the “heat beneath our feet”, currently provides 3.7 gigawatts of electricity in the United States, enough to power over 2.7 million homes. However, this is just a fraction of the vast, nearly inexhaustible potential of this resource. 

A significant amount of geothermal energy remains inaccessible with current technology, leaving a wealth of energy untapped beneath the earth’s surface.

The development and implementation of EGS could unlock these resources, putting new, clean, and dispatchable electricity on the grid. 

EGS uses man-made reservoirs to facilitate the fluid flow necessary to bring hot water to the surface for electricity production. The technical EGS potential in the United States is sufficient to meet the electricity needs of the entire world. 

Even capturing a small fraction of this resource through commercial-scale deployment could affordably power 40+ million American homes and businesses.

Investments in EGS will also exponentially increase opportunities for geothermal heating and cooling solutions nationwide. 

A Powerhouse for Growth

The geothermal industry can potentially become a powerhouse of U.S. economic growth, with particular benefits for rural communities. Geothermal jobs, especially in construction—which currently makes up 57% of the geothermal workforce—cannot be outsourced. 

Furthermore, the similarities between the geothermal and oil and gas industries present an opportunity to transition a skilled workforce. The same goes for the tools and best practices in sourcing fossil fuels; they’re useful in producing geothermal energy.

Expanding geothermal energy can also help communities negatively impacted by fossil fuel use and production shift to clean energy.

Achieving the Enhanced Geothermal Shot, a target to reduce the cost of EGS by 90% to $45 per megawatt hour by 2035, will go a long way toward achieving President Biden’s goals of 100% carbon-pollution-free electricity by 2035 and net zero emissions across the U.S. economy by 2050.

EGS has the potential to power over 65 million American homes, according to the Energy Department. 

Results from Project Red support the findings of the DOE’s Enhanced Geothermal Earthshot. They also show that geothermal energy could supply over 20% of U.S. power needs, while complementing other renewable energy sources to reach a fully decarbonized grid. 

The breakthrough by Fervo Energy is a significant step towards a sustainable future. With the successful demonstration of EGS, the company has shown that geothermal energy isn’t just a resource for the future. It is a viable solution for today’s energy needs, powering millions of homes and businesses.

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Sylvera Raises $57M to Help Companies Invest in Carbon Credits with Confidence

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Sylvera, a leading carbon data provider, has secured $57 million in Series B funding round to incentivize companies to invest in real climate impact with carbon credits and expand in the U.S. 

Balderton Capital led the round along with other new investors Bain & Company, Fidelity Strategic Ventures and 9Yards Capital, with participation from existing investors Index Ventures, Insight Partners, Salesforce Ventures, Speedinvest, Seedcamp, and LocalGlobe.

Achieving Net Zero Goals with Confidence

Meeting the net zero by 2050 goal is critical if the world has to prevent catastrophic climate-related disasters. But without ramping up emissions reduction efforts, at least doubling the pace by 2030, achieving net zero targets is impossible. 

The world also has to remove about 10 Gigatonnes of CO2 from the atmosphere annually by 2050. Reaching net zero calls for capital investment of about $3.5 trillion each year over the next 3 decades. This funding is necessary to build infrastructure and scale up technologies crucial for a zero-carbon economy, including carbon credits. 

High-quality credits are important in keeping projects around the world running, such as reforestation and renewable energy deployment. The credits offer one of the most scalable ways to drive climate finance where it’s most needed.

Unfortunately, both climate actions and funding aren’t enough to keep pace with the net zero deadline. What more, tracking progress against climate targets and measuring the climate impact of investments are difficult because of insufficient data.

This is what Sylvera is changing, for the better, as asserted by the company’s CEO and co-founder, Allister Furey, saying:

“Our technology ensures funding is going to the projects, companies, and countries having maximum climate impact to get the world on track for net zero. In time, this data will create much-needed financial incentives, such as higher share prices and cheaper borrowing, for organisations taking serious net zero action.”

The London-based carbon rating agency is helping companies and governments to invest in carbon credits and confidently report on their impact since 2020. With its cutting-edge technology and carbon measurement methodologies, Sylvera assesses climate action investments, including carbon credits, and rates them. 

Sylvera’s data infrastructure and carbon intelligence enables companies to confidently reach their net zero goals and deliver global net zero. 

Last week, the carbon credit rating firm, along with Pachama, published their carbon market trend report. It sums up the most significant trends that experts foresee shaping the carbon market landscape in 2023 and beyond.

Funding Sylvera’s Growth and Building Its Platform

Sylvera builds software to impartially and accurately assess carbon projects that capture, remove, or avoid emissions to help organizations ensure that they’re investing effectively in real climate impact. 

The carbon ratings company uses technology and climate science to develop and test rigorous methodologies to rate projects and produce data. Its unique platform that leverages machine learning facilitates the creation of new sustainable investment products while educating investors about the quality of carbon credits. 

Highlighting the role of Sylvera and its innovative carbon rating, Daniel Waterhouse, Partner, Balderton Capital, noted that:

“Sylvera has proven to be the market leader in this emerging field and we are excited to be joining them on the next phase of the journey and their work in accelerating the roll-out of data, tools and software in order to steer a path to reducing damaging climate change.”

Moody’s ratings are to bond credits, Sylvera’s ratings are to carbon credits. Its rating is a combination of these core scoring pillars – carbon, additionality,  permanence, and co-benefits. The carbon rating process takes between 60-120 hours, but it depends on the complexity of the project.

Generally, it involves the following steps:

The $57 million investment will help Sylvera further develop its platform and technology to produce the most robust data crucial in climate action investment decisions. The funding will also help the company scale its teams and product offerings as it expands into the US. 

Having a new office in New York, a global hub for financial services, will help Sylvera grow its network. The company has 12 new employees in the U.S. right now and will double this team by year-end. 

Since its Series A announcement in January last year, Sylvera’s customer base has grown 7x, adding more Fortune 500 clients. This Series B round brings its total fundraising to over $96 million. 

Sylvera is serving major financial services providers, governments, and infrastructure suppliers while partnering with large companies like S&P Global. 

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