NeoCarbon, a Berlin-based climate technology startup, is taking a novel approach to improving direct air capture (DAC) devices to capture CO2 emissions. The focus is on developing a DAC kit that can be installed (and retrofitted) in cooling towers operating in the industrial sector – thereby reducing the cost of reducing carbon emissions.
The €1.25M pre-seed round, led by the collaboration of PropTech1 and SpeedInvest, will be used for the next phase of development as NeoCarbon works to transform its existing lab-based proof of concept into a pilot in a commercial facility. – Hopefully early next year. So it will use the pre-seed funds to that end, expanding its engineering team to get the MVP in shape for the first pilot in the coming months.
Instead of the huge towers you might see at a power station, the main focus is on adapting DAC to smaller industrial cooling towers. (Or the very small units you might find in a shopping center or office building.) Although he says he’s waiting a long time for the technology to work for larger towers. But they argue that even small industrial towers can process a lot of air and capture meaningful amounts of CO2 – and the climate crisis won’t last long and wait for massive projects to start, so the philosophy is to start small. To measure quickly.
“Let’s say 2-3 years from now, our sweet spot will be 1-10 megawatts of cooling power,” co-founder and CTO Sylvain Toromanoff told TechCrunch at Zoom. “And those are in the capacity of thousands of tons per year.”
“We did a very early proof of concept (POC) in February,” he continues. “Now today we’re finishing the first, what we call MVP – so it’s still very small. But POC was very low-budget and by-the-numbers. We are now finishing up, basically this week, the MVP prototype which is a much better quality product.
We haven’t started benchmarks and tests with it yet, but it’s basically in the final stages of being operational.
While DAC sounds good in theory – it uses chemicals to absorb problematic emissions from the air! – Human activity is emitting a large amount of CO2 (neocarbon cites a relevant statistic of 51 billion tons per year), so you need more DAC to prevent climate crisis.
However, one major obstacle to scaling DAC is the cost of implementation.
NeoCarbon’s approach to cutting DAC costs is to reuse existing industrial infrastructure that already has the facilities to absorb carbon from the air – after all, cooling towers are designed to let a lot of air flow through them – meaning nothing. A new CO2-capturing building needs to be built. (Although you should be sure that your technology can adapt to different installation conditions.)
So it claims to be able to reduce DAC costs by up to 10x – making the DAC “mass market ready”, as it describes it.
CO2 comes out of the exhaust
Another consideration with direct air capture is, well, what do you do with the captured CO2?
If you simply do something that re-releases into the atmosphere – at best – you are delaying rather than cutting emissions. If you say you have the technology to help the climate crisis, that doesn’t cut it.
In the short term, NeoCarbon says that its approach to this issue is to focus on sites where the captured CO2 can be recycled by the industrial establishment itself – such as permanent farms (which use CO2 to feed plants) or carbonated beverage makers (things for liquid fizz).
This is another reason why industrial cooling towers are based on retrofitting – since they can be located in close proximity to commercial CO2 needs – allowing carbon dioxide to be fed as a raw material to commercial processes. (Furthermore, as well as climate factors, CO2 has experienced some shortages and price increases in recent years, arguing that there could be broader business benefits, such as strengthening supply chain resilience and reducing production costs.)
This cycle only allows for the creation of carbon neutral processes. So, in the longer term, Toromanoff says he plans to partner with those who plug (or pipe) captured CO2 into permanent carbon storage facilities so that the actual process can take place (carbon capture and storage) — thereby worrying about the possibility of DAC. Playing its role in mitigating climate warming. (“We already have a few LOIs[letters of intent]and discussions around storage partnerships — let’s say as early as 2024 for the first projects,” Toromanoff said.)
Again, it’s betting that carbon sequestration infrastructure will be built in places with targeted industrial cooling towers—as industries like manufacturing and agriculture are under pressure to deal with large carbon footprints.
Therefore, in general, the strategy to stimulate the adoption of DAC is to zero in on pigeonholing the demands that it assumes will raise the right conditions for expanding the technology – and the use of DAC as a climate change mitigation measure – as well as to grow the technology licensing business around it.
Target customers to license DAC’s cooling tower technology – a segment it wants to focus on as a business and scale up the technology – may be cooling tower manufacturers themselves. After all, they have a lot of developed infrastructure, but they are not a modern industry, so they lack the product innovation that would allow them to develop such services in-house, which would otherwise be a pretty standard industrial part of what they sell. (So working with a startup is one way to bridge that pesky gap).
“Initially we are going by industry so that we can tailor our product to one or specific industries. And of course we are in contact with the biggest international players in cooling tower manufacturing,” says Toromanoff, speaking about NeoCarbon’s go-to-market plans. “We are currently preparing an MOU with at least one of them so that we can jointly develop our product with their cooling towers.
“One thing that came up was the idea that we focus on the recording technology and they can focus on the link part – not the core or the difficult part of the IP, but it’s more difficult, a lot of it, but technically it’s just connecting the pieces together.
“In the long run, we don’t want to handle all of this ourselves because—for example— [for] We don’t want to have maintenance fleets when global scale, especially cooling tower manufacturers have this,” he added. “We can use it [existing maintenance contract relationships they have with their customers] So they were also doing maintenance for our product. And of course that means that they will eventually have some exclusive license to use our product in a certain geography and time frame.
It’s still early days for the startup, which was only founded in January, but the climate crisis isn’t over yet, so NeoCarbon’s founders want to move quickly enough to turn their prototype into a tested and proven hardware that adds CO2. -Format facility to cooling tower ‘plug and play’ issue.
Another climate technology startup – US-based Noya Labs – has been inspired to take a retrofit approach to encourage DAC adoption, but argues that they have a slightly different focus (ie on industrial rather than commercial buildings). They’re also built in Europe (not the US), so their technology is focused on the 300,000 or so cooling towers that can be quickly adapted to the region.
What is the biggest challenge in successfully developing their technology? One of the “most critical” elements, Toromanoff says, is making sure they can retrofit their DAC equipment without negatively impacting the cooling function (or causing any other problems for industrial processes).
“That’s one of those non-negotiables because we couldn’t do it otherwise. There’s a few ways we can look at this. It might be something we need to develop with iteration. So the idea is these two things. [balance out]” he points out. “Basically, the tower will be less efficient, but it will require less work.”
The start-up’s origin story involves the two scientist co-founders meeting in Berlin at a co-founder related event held by company-developer Antler – after both had left their jobs to pitch startup ideas that could impact the climate. Fast. (The other is NeoCarbon’s co-founder and CEO Rene Haas, who’s been stuck on a slow train for most of our zoom chat.)
It was also at Antler—another participant in NeoCarbon’s pre-seed development, along with some unnamed angels—that the pair were developing ideas for when they came across what Noya Labs was doing by retooling the DAC and saw an opportunity to do something similar. Europe (and the infrastructure for European industry), believe that the climate has created a great opportunity to rapidly expand the necessary DAC uptake by leveraging their existing start-up experience and skills in execution and expansion.
“The best-case scenario is to get it up and running in Q1 next year,” said future pilot Toromanoff. [because of the climate crisis]. That’s why it’s called a pilot – because we’re not pretending it’s the final product, so we need a partner who’s ready to take a little risk.
