For the past 25 years, the California non-profit organization Xprize has organized highly profiled competitions within innovation at a global scale. In the first Xprize competition, the challenge was to send a spaceship, with the same crew, to the edge of the atmosphere twice within few weeks.
The $ 10 million prize was large enough to create a high level of awareness and thus attract serious investments from many private companies. It is estimated that the competitors invested a total of over $ 100 million in space travel, and the company that won became Virgin Galactic, which has just started sending up space tourists.
Since then Xprize has launched and completed a large number of similar competitions based on the same approach that the big price and high prestige mobilize entrepreneurs and enhance big investments in developments that can kickstart new industries.
Today, there are a handful of large competitions underway, and several of them are about solving fundamental challenges within climate and environment.
The latest Xprize was awarded in April 2021 for the development of a method to radically reduce CO2 emissions from concrete production - one of the world's major sources of CO2 emissions. After six years, two teams met the goals and they shared the first prize of $20 million.
One of the winning teams was the California startup CarbonBuilt, whose technology reduces the CO2 footprint of concrete by more than 50 percent. CarbonBuilt stores captured CO2 from industrial plants via their newly developed type of cement, which binds CO2 so it is permanently stored in the cement. In addition, a smaller amount of cement (60-90 percent less) is needed compared to traditional portland-cement, and the process requires lower temperature and pressure, resulting in savings both in the economy and in the energy accounts.
CarbonBuilt is thus helping to transform the carbon-intensive cement industry, which accounts for seven to eight percent of all global CO2 emissions. As a follow-up to the success, Xprize has recently launched another competition, XPRIZE Carbon Removal, funded by Elon Musk and the Musk Foundation with $100 million as a winner prize. According to Xprize, it is the world's largest incentive award to date.
The competition runs for four years, and by the end of 2025, the winning team must be able to demonstrate a solution that can remove at least 1000 tons of carbon per year. Additionally, the team must show how their technology can pave the way for removing carbon at a megaton scale and in the long run on the gigaton scale (billion tons).
In comparison, the average Dane emits around 17 tons of CO2 annually. Undoubtedly, the huge price will help to accelerate the development of new technologies.
Forest fires and droughts have intensified the interest in climate solutions
Unfortunately, the growing interest in California for developing climate solutions is due to the fact that climate change is already evident and catastrophic.
Natural phenomena such as wildfires and droughts have worsened drastically in California in recent years. Again this year, the number of wildfires and burned areas are breaking records due to extreme heat and unusually dry winter months. However, at least it has resulted in a positive and remarkable development in California and Silicon Valley: They have set the United States' most ambitious climate goals and intensified their climate efforts and green transition.
California currently has a goal of achieving CO2 neutrality (that is, removing as much CO2 as is emitted into the atmosphere) by 2045. However, California Governor Gavin Newsom is keen to accelerate plans, and a few months ago he asked the California Clean Air Authority (CARB) to outline a plan on how California can meet its CO2 neutrality goal already in 2035 - which is 15 years ahead of the goal in the Paris Agreement.
At full speed, California is investing in energy efficiency and renewable energy, but to achieve the ambition of CO2 neutrality, it is not enough to reduce emissions, it is also necessary to actively remove CO2 from the atmosphere, known as carbon removal and is often abbreviated as CCSU: Carbon Capture Storage / Sequestration and Utilization.
Thus, there is a lot of attention on carbon removal in California, and the ecosystem for innovation in Silicon Valley has also discovered the huge business potential and has started investing massively in CCSU.
The climatetech ecosystem in California is growing
Climatetech is another buzzword. Although Silicon Valley is best known for digital business adventures and consumer products, the past few years have marked a flourishment of technologies to help combat climate change.
In the period from 2013-2019, $ 15 billion in venture capital was raised for climatetech startups based in California alone, the majority of which is in the San Francisco Bay Area - the world's largest climatetech hub measured by venture capital investments.
According to Silicon Valley Bank, 2021 will be a record year both in terms of investments in climatetech startups and in terms of the amounts raised in new climatetech venture capital funds.
Not least, there is a growing interest in carbontech, a new industrial sector focusing on solutions to capture CO2 and use the carbon that would otherwise have affected the climate negatively to produce a range of products and services - from CO2 in soda to new types of fuels.
Companies and authorities are keeping up
The development within carbontech is further accelerated by the fact that several American companies are showing great commitment. Microsoft, for example, has a goal of being carbon-negative by 2030. The goal does not only apply to Microsoft's own business, but also to the underlying value chain of suppliers - and by 2050, the tech giant will have eliminated all its historical emissions through investments in carbon removal.
The Fintech company Stripe was a first mover and announced in 2019 that they would invest $ 1 million a year in carbon removal startups. Since then, Stripe has invested an even higher amount annually and at the same time, the company has set up the investment program Stripe Climate, where their customers can contribute with further investments.
With their ambitious goals and investments, companies such as Stripe and Microsoft are helping to drive the demand for new technologies that will support companies in achieving their goal of CO2 neutrality. In this regard, Silicon Valley plays a major role, as the West Coast has the knowledge, capital, and experience needed to develop groundbreaking technologies and solutions within the green transition.
In addition to investors' focus on the area, there is an increasing focus on carbon removal at the political level, which has also started to realize that major initiatives and incentives are needed to achieve future goals.
Funds have been allocated at the federal level for research and development within CCSU, administered by the US Department of Energy.
The growing American awareness on climatetech also means that there is great potential for Danish companies that want to be part of the journey across the value chain from CO2 capture to storage and utilization. In June 2021, Denmark and the United States entered into a new cooperation agreement on innovation in the field of energy, which will strengthen collaboration in energy research and demonstration projects, also within CCSU.
As in so many other technological areas, Denmark should look to the tech hub in California in the fight against climate change.