Resources

• XPRIZE: Carbon XPRIZE and Carbon Removal XPRIZE
• Climate Resources at the National Academies
• Airminers
• New Energy Nexus
• Climate Tech VC

Guests

Climate Rising Host: Professor Mike Toffel, Faculty Chair, Business & Environment Initiative

Guest: Marcius Extavour, Vice President, Energy & Climate, XPRIZE

Transcript

Editor’s Note: The following was prepared by a machine algorithm, and may not perfectly reflect the audio file of the interview.

Mike Toffel:
Welcome Marcius. Thanks so much for joining us on Climate Rising.

Marcius Extavour:
Thank you. It's great to be here.

Mike Toffel:
I wonder if we could just start by asking you to introduce yourself and your role at XPRIZE.

Marcius Extavour:
Sure thing. Well, my name is Marcius Extavour. I'm the Vice President of Energy and Climate at XPRIZE Foundation. And this means I oversee all of our program design, program execution and sort of visioning and looking forward about where we think energy and climate solutions may go.

Mike Toffel:
Great. And can you tell us a bit about XPRIZE itself? What is the organization about, what are they trying to achieve?

Marcius Extavour:
XPRIZE is a nonprofit, been around about 26 or 27 years, with a really kind of unusual and ambitious mission. We are trying to use technology and social innovation to make life better for everyone. So what we mean by that is we have a view that a lot of the problems that face us are extremely difficult, but solvable. We believe that human beings are resourceful and clever and creative, and we can come together and create a better future that we, hopefully, all want and need. and we've got various methods and approaches to try to achieve that.

Mike Toffel:
Let's talk about those methods and approaches. presumably they have something to do with prizes and how do you think about what topics to offer prizes on and what other mechanisms do you offer besides prizes?

Marcius Extavour:
We have roughly seven areas of focus, so energy and climate. That's where I live and spend most of my time. We focus on biodiversity and conservation, deep tech and the quantum world. Health. We also focus on education and other social issues. We focus on space exploration and we also focus on food, waste and water. Now, inside of those, we do a couple of things. The thing we're known best for is the incentive prize. this is really about trying to identify a difficult problem, trying to define the problem well and inspire and encourage others around the world to go after productive solutions, to that problem that can have follow-on and broader benefits than just creating a widget.

First of all, in my world, climate and energy, what does the future look like? What could it look like 20, 30, 40 years from now? And then how do we go about building a bit of a roadmap or a pathway to get there? What particular breakthroughs do we need? What kind of social interventions do we need? What kind of direction should we steer a particular type of technology?

And of course, we're not just talking about technology here, we're thinking about what policy changes are needed, what social changes may be needed, what economic changes may be needed. And we realize XPRIZE can't necessarily touch all of those different levers, but the ones that we can that are amenable to a prize model or crowdsource innovation, then we try to go after those.

Mike Toffel:
Why do we need a prize above and beyond the venture capital market?

Marcius Extavour:
A prize is a good fit for developing solutions that are even too risky for venture capital. Venture capital is considered to be one end of the risk spectrum. If maybe a government bond or something might be at the other end, even though that's not necessarily an innovation tool. But the point is, if we can identify a specific reason or a set of reasons why, for instance, the public sector and governments have not been able to, or haven't chosen to approach a topic or the citizenry, maybe aren't able or don't have the means to approach and advance a topic forward. And the private sector, including all the private capital markets, may not be able to advance the topic. Then we think there's a good opportunity for a prize.

In other words, something where it's probably too early, maybe even too risky, even for venture capital. there's actually a whole other domain of risk taking that's even just well beyond what venture capital can touch. Something that you just cannot really bank on returning investment to your, let's say, limited partners within a 10 year window, which is a common VC approach. And a lot of those problems fall into the domain of traditional science, traditional R&D, development of technology that may not have obvious commercial application, but could have extremely wide social benefit. So these are all areas that we try to look at.

But to get back to your question, why a prize? I don't think of it so much as an either/or, I think of a prize as a really interesting amplifying tool that can work with venture capital with, let's say, private equity, with grants from private or public institutions, with other forms of innovation support. A prize is another engine to get creative minds working on it, and sometimes to bring unusual suspects or even unusual solutions to bear that might not otherwise pop out of the typical innovation cycle.

Mike Toffel:
So it sounds to me like you have two innovation funnels: first funnel is figuring out which problems should we even focus on. And the second once you've established the competition, then there's of course the question of who advances through each stage of the competition itself. So we're talking about that first funnel.

Is that a good way to think about it?

Marcius Extavour:
Yeah, I think that it is. I'd say in shorthand, a prize can be a great way to bring some of those elements together, but not a replacement for some of those other kinds of tools.

Mike Toffel:
Okay. So let's talk about this first innovation funnel a bit more. Help us understand, especially, in the environment and climate space in which you operate and that we're focused on here at Climate Rising. How do you think about which topics to focus on? And at the end, we're going to talk about two of your actual prizes that you've launched, the Carbon XPRIZE and the XPRIZE Carbon Removal. How did those end up at the end of the funnel? What else kind of entered the funnel and how did you whittle it down to those?

Marcius Extavour:
We're actually trying to take a slightly different approach to how we're going to start identifying which problems to focus on at XPRIZE. So I'll just take minute to speak about that. And then I can happily get into the back stories of how the carbon prizes and other climate related prizes have come about.

Mike Toffel:
Sure.

Marcius Extavour:
We're looking to fill gaps where we see them in the innovation landscape. Let's imagine the world in 2050, we can write a paragraph about what we think that world would be. We could say things like, "Oh, we'd like all of the energy to be from zero carbon sources." We could say something like, "We'd like our greenhouse gas emissions to have peaked and maybe already be on the decline." We could get more or less ambitious with that. We could talk about restoration of biodiversity or prevention of increased biodiversity loss.

We could set ourselves a few targets for 2050, and that's sort of the easy part. The hard part is saying, "All right. Let's say it's going to be that way in 2050. That's... What? 30 years from now, just less. Do we have a plan to get there? Could we establish one year goals, three year goals, five year goals, 10 year goals? Could we lay out the set of interventions and innovations and changes needed to achieve that future that we've just made up and then work backwards and say, "All right. Well, which of those would be amenable to this prize model, which ones wouldn't be?"

I can tell you right now, probably the majority of them may not be. I think a prize is a powerful but narrow, limited tool, and we've got to pick our spots. And frankly, not direct prizes to places where we think it may not be actually helpful and another method might be much better. Maybe venture capital, maybe a grant on its own. So that is where we're headed, a nice, systematic sort of back-casted view to the future. The reality of how we got to where we are was a bit being a bit more opportunistic, doing that in a more informal and ad hoc way and looking for gaps and opportunities. So a couple of the topics that XPRIZE has pursued over years that I think are relevant to climate are turning CO2 into valuable materials and products that was called NRG COSIA Carbon XPRIZE.

We're working on carbon removal now, so you can see, these are both really focused on the decarbonization, direct greenhouse gas management part of the ledger. And then we've considered, but not launched prizes of other topics like solar PV, battery storage. Battery storage for instance, is a great example of a topic that we and many other groups clearly have identified as a need and an opportunity, but we have never felt that there's a good prize intervention there.

There's a tremendous market incentive to make better, cheaper, lighter, more effective, less toxic batteries. And plenty of innovation support of all types, private, public is going after that, around the world. So our thought has been, "Well, a prize may not really do much. Let's reserve that resource for something else where we can actually have an impact."

Mike Toffel:
Right. So areas that are less attractive to outside venture capital investment.

Marcius Extavour:
Exactly.

Mike Toffel:
Okay. So what other characteristics make for a good prize?

Marcius Extavour:
XPRIZE likes to run prizes that are not just prizes, but also have some other characteristics they tend to be larger, more audacious and intentionally more eye-catching because we're actively trying to generate public discussion around the topic. But here are a few characteristics of a prize: We look for things that can define the problem without necessarily defining the solution. We don't want to be too prescriptive about what the solution needs to look like, just what its characteristics and properties could be.

We like prizes that can be easily conveyed to non-specialists. So carbon removal for instance, is sort of tricky to get into the nuance But climate change is a pretty easy idea to convey right now. So saying that we have a prize focused on innovations that could help with climate change is something that people understand and can quickly make a decision if they think it's interesting and want to get involved. We look for prizes that can have objectives that can be measured. We're very suspicious of subjective, consensus and conversation-based adjudication. We prefer objective, measurement and data-based evaluation.

Mike Toffel:
So that's like a miles per gallon type of measure.

Marcius Extavour:
Exactly. So here's an example we could set an objective of, "Well, we want to restore balance in our carbon cycle." But that'd probably be a little too broad of a prize because there are not only a million ways to do it, but what does it mean to measure balance exactly? Another characteristic I'll add too, is that we look for things that are not too difficult, but not too easy. And this is a bit more of an art than a science to put it together. We say audacious, but achievable. It's easy to design a prize that is for an extremely audacious goal. Let's say time travel, would time travel be interesting? Sure. We could launch a prize for time travel. Great. As a physicist, I could tell you, we're probably not going to see any time travel in the next few years. Maybe never.

So that's an example of an extremely lofty goal, maybe even an interesting and valuable goal, but probably not helpful as a competition. On the other hand, we could have a prize for something that we're quite certain can be achieved. And if that's the case, folks still may not compete because it may not be interesting enough, but also we won't really have achieved anything. We could say, "Let's have a prize, make solar photovoltaics 2% more efficient." That's probably going to happen on its own. We probably don't need a prize to do that. So those are some of the things we look for in prizes.

Mike Toffel:
And what I'm hearing in these criteria are both technical characteristics, as well as social characteristics. Like the one that I think is interesting and a little surprising to me is about the widespread understanding of the competition. how culturally resonant it is. And can you just explain, like why not focus on the technology side, exclusively, the issues that are most important to address climate change, even if most people don't understand it? Like, "Who cares, because that's what needs to get done." What's the counter narrative as to say, "No, no, no. We're going to choose something that might be second most important, technologically, because it has this social of the resonant piece to it."

Marcius Extavour:
we look for both. If we don't focus on the things that are technically needed, we are almost guaranteed not to have an impact at least as measured by those technical metrics. But what we look for is the intersection of that list of topics with topics that also could be culturally relevant because we think that's where the real sort of exponential opportunity is, to really not just make a change in the technology and science arena, but to possibly impact and touch culture. making the impossible possible.

What that means is trying to let people know that or somehow invite innovators to demonstrate that problems that we might think are intractable are actually solvable. And this is a really great one for climate. Climate is an example of a problem that many people are starting to lose hope about or feel that it's just too overwhelming and too big for us to attack. And without denying the fact that it is a big and overwhelming problem, we think it's important to offer some inspiration and hope if it's backed by data, that this is a solvable problem, it may be difficult, but this is not something we can afford to give up on. And so, that's one of the primary reasons, I think, really that we look for that intersection of technically important and valuable, but also culturally resonant. And if we can find those topics, we can, we think, make really fantastic prizes.

Mike Toffel:
Let's pivot from the discussion of what topics to focus on to actually talking about some of the climate change prizes that you've offered and are currently offering. So the one that's widely known is the Carbon XPRIZE.

What was the objective of that prize? That's one example that's been completed, right?

Marcius Extavour:
That's exactly right. So it goes by the name, NRG COSIA Carbon XPRIZE. And NRG and COSIA were the two sponsors of the prize. As an aside, the way XPRIZE works as a business is that we are raising money from sponsors that XPRIZE then manages and we sort of pass through to winners of a competition. The big problem we were trying to address was the lack of a market incentive to reduce emissions. That was the starting point. CO2 emissions specifically are essentially free and there's no cost to emit them. That is starting to change, and there's a lot of conversation about carbon tax. But when XPRIZE began that journey around 2010, that wasn't the case and a carbon tax seemed a long way off. I mean, frankly, it still does for the United States and many other places in the world.

Mike Toffel:
Yeah.

Marcius Extavour:
So the idea, "Is it possible to create an incentive for an emitter to actually address their own emissions aside from public pressure, aside from regulation?" Well, what's one thing that for-profit businesses respond to? Revenue. And it turns out that it's known scientifically, that many materials that we use in our economy today are fossil fuel-based. but they could be CO2 based. In fact, every hydrocarbon we use in our society, whether it's plastic, fuels and all the other products that we use hydrocarbons for, could in principle be made, not with fossil hydrocarbons, but with carbon, from CO2 and hydrogen from another source.

So the challenge was focused around: Can you make something valuable out of CO2? Can we align the profit motive with the decarbonization motive? The prize itself focused on, "Here's some emissions from a power station." Which was our test case, and teams anywhere in the world, "What you've got to do is, use any method to turn that CO2 in the emission stream into any product. We don't care what the product is, but we're just going to score you on whether it actually works, its engineering efficiency, its climate impact and its ability to actually generate revenue." And so those are the contours of that competition.

Mike Toffel:
So this is folks using smokestack emissions at coal fired plants and natural gas burning plants to try and extract the carbon or CO2 from the emissions, repurpose it to create substitutes for fossil fuel derived products. Is that right?

Marcius Extavour:
That's exactly right. I'll add the word, recycling. We're taking the carbon dioxide from those emissions and in principle you can do this on any type of emissions. Even though we used power plants because we thought it was a really hard test case. And you can make not just replacements for the products made of fossil hydrocarbons, but it turns out a lot of other products, for instance, concrete or cement or food products that are all based on carbon molecules of some type, those could be manufactured using carbon dioxide.

Mike Toffel:
Got it. So to some extent the power plant is relatively unchanged. Their business model is still using fossil fuels to create heat, to generate electricity. There's now a revenue opportunity to prevent some of their pollution from just entering the atmosphere and instead be useful for other products. And it's that substitution that's actually where part of the environmental benefits lie, that you don't need dig up as much alternative additional fossil fuels to create that. And we're keeping it out of the atmosphere, at least for that one cycle. I guess there's always a question, "Well, what happens to it eventually? Does it eventually end up in the atmosphere anyway?" Even if it did, the fact that secondary product didn't require fossil fuels is an enduring benefit.

Marcius Extavour:
That's exactly right. you did a really great job of summarizing it there. But It's sort of a convoluted, logical argument you have to follow for this all to make sense. In other words, to be blunt, And this, gets into some of the critiques of CO2 conversion. It's very easy to make a bunch of products out of CO2. just because someone tells you they've made a product out of CO2 doesn't necessarily mean that's a good thing, from a climate perspective. It might even be a profitable business, but it might not actually move the needle on climate.

One of the ways that we avoided that trap was to really focus on rigorous life cycle analysis. And that's the phrase that is the method and the approach to really look carefully at all the different emission sources in any project. How long did the CO2 stay trapped in the material? If it's food, the answer is not long. If it's concrete, the answer is close to forever or at least centuries, maybe millennia.

And we only admitted solutions that could either be what we called carbon neutral, which means no worse than the incumbent, all things considered or better than the incumbent. And we had to look very carefully at this lifecycle analysis to make sure, if you actually implemented the solution, yes, this actually would reduce emissions because without that, what's the point?

Mike Toffel:
And this circles back to your point about the need for objective measurement in the framing of the prize.

Marcius Extavour:
That's right. And that prize was tricky because we had to balance business metrics. Do you have a material that can feed it to a market? What is the size of that market? What is the potential CO2 uptake of that market? With engineering and science objectives like, does it actually work? What's its energy efficiency and will it on net reduce or increase emissions? And if it increases, we're putting you to one side, but if it could reduce we're interested.

Mike Toffel:
Right. So you referred to this as carbon conversion. I've also heard of it called carbon utilization.

Marcius Extavour:
That's right. turning CO2 into some alternative material. CO2 utilization is probably the most common phrase.

Mike Toffel:
Okay. So tell us a bit about how the competition went. How many entrants did you have? How did you sift the entrants to the finalists and then you had some grand prize winners?

Marcius Extavour:
It was really not just interesting and fun, but fascinating to see the evolution of the space over the five, six years that it actually ran. So it launched in the year 2015. The first step was announcing that the competition existed.

The next step was to recruit a set of expert judges. For an XPRIZE competition, we always use independent experts to actually do the evaluation. So these are the people looking at the data that the competitors generate and ultimately selecting the winners based on the rules. So you publish the rules, you recruit the judges. Had a fantastic crew of engineers, scientists, business people from the private sector, the public sector, various countries,. We had something like 47 different submissions enter the competition from I think, seven or eight different countries. The first round was, submit a proposal. What do you plan to do? What have you done already? Who are you? The judges selected 28 of those to become semifinalists. The semifinalists then had to produce a small working demonstration at a certain scale.

Larger than lab scale, but not really industrial pilot scale yet. The judges then selected the best 10 of those to be called finalists. And they were each given half a million dollars. So we announced our finalists April, 2018, so three years in. They were split into two subgroups. They had a choice whether they wanted to test on the emissions of a coal power plant at a test site we got built in Wyoming. Or they could test on the emissions of a natural gas power plant that we also got built at a separate test site... Sorry, adjacent to the power plant. We didn't build any power plants.

And that was in Alberta, in Canada. And interestingly, some teams chose the Alberta site because they favored the emission stream coming from natural gas, which is actually cleaner, but also more dilute in terms of CO2, which means you actually have to process more air to get any carbon out. So it's a split challenge. Whereas other teams, had a technology that they thought could work better on coal emissions, which are generally much dirtier. And then other technologies were agnostic. But in any case we had 10 finalists split into two pools of five.

To win the prize you had to build a working, outdoor, small commercial pilot that could run continuously over the course of months. And ultimately there was one winner per track. So that ended up with two total winners for the competition. So over that six year period, we went from 48 down to those two winners, And at every stage looking at performance data to pick the teams that advanced and the teams that eventually won.

They won 10 million dollars each as the grand prize.

Mike Toffel:
And can you tell us a little bit about those technologies and what became of them?

Marcius Extavour:
Certainly. So it's kind of interesting that they share some similarities. So the two winners were called CarbonBuilt, which is a spin out of UCLA. A civil engineering professor there called Gaurav Sant had been working for a long time on various decarbonization pathways in civil engineering, but specifically in cement and concrete. I'm anticipating whenever we talk about concrete and cement... Public service announcement: cement is the powder and concrete is the hard stuff. Cement is like the glue that holds the hard stuff together.

In any case, CarbonBuilt had been playing with cement and concrete and had found a way to embed carbon dioxide into wet concrete during the curing process. They showed that they could increase the uptake of carbon into the concrete. And in the end, be left with a concrete block that contains more carbon than it normally would and therefore it has a lower carbon footprint than traditional concrete.

They had some data that shows there were some strength improvements. But their primary sales pitch, so to speak, or their value proposition was on reduced footprint and also fairly simple technology setup.

Mike Toffel:
So this is targeting the embedded carbon in building materials, which is a big deal, right? I think I've read that half the carbon footprint of a building is embedded in the material you use to construct it before you even operate the building. And so that's-

Marcius Extavour:
That's right.

Mike Toffel:
A huge deal.

Marcius Extavour:
It's massive. If you're a building owner, you're a developer, of course, you're going to think about doing things like changing out your lighting system, making sure heating and cooling systems are optimized, if you're trying to reduce your carbon footprint. But actually looking at the materials used to construct the building is sort of the next frontier. And because concrete is such a huge global market and is responsible for between five and 10% of global CO2 emissions, it's a big opportunity and a great fit for technology innovation.

Mike Toffel:
Okay. So what was the other grand prize winner?

Marcius Extavour:
So the other grand prize winner is called CarbonCure. whereas CarbonBuilt is an early stage company, recently spun out of UCLA. CarbonCure is further ahead. They were a startup, when they started the competition, they had customers, they had a product, they had revenue. What they brought to the competition was an innovation in their process, which was then brand new to them and is since something they've started to commercialize. So some similarities are they work on concrete. So they've got the same market opportunity. They are approaching it in a similar way, where they are talking about embedding carbon into the concrete product. Their business proposition is really based on strength and performance of the concrete.

So whereas I said, CarbonBuilt cures bricks in the presence of carbon dioxide. Yeah, that's called precast concrete. It arrives at your site in a solid form. CarbonCure focused on ready mix. This is the concrete truck with the big barrel in the back that rotates. So they embed, actually, a sort of nano structured form of carbon dioxide into the wet mix.

And then when it's poured into a sidewalk or a highway overpass or whatever is being made of concrete, a building, the carbon is then locked into the concrete. And just as an interesting point, they have a retrofit business model. So they will call a concrete producer and say, "We have a device that we can retrofit into your existing production line today. In fact, we'll make it easy. We'll set it up for you, we'll own and maintain it. We will supply the carbon dioxide. You will save cost and you will have a superior product." And they will share the proceeds of let's say, carbon credit revenues.

Since the start of the prize, they were able to pick up a lot more investment. I think they used the prize as a bit of a slingshot. Every time they advanced, they would announce it. And now they're rapidly expanding to different continents. So they're really on their way to trying to take a climate relevant bite out of the carbon footprint of the concrete industry.

Mike Toffel:
So their business model is, "When you lease our contract with us to use our equipment, the concrete production cost will be lower and it'll be stronger."

Let's pivot to talk about the second XPRIZE, the Carbon Removal, the second prize focusing squarely on climate change.

Marcius Extavour:
Mm-hmm (affirmative).

Mike Toffel:
So that one's still in progress, right? So where are we in that pipeline?

Marcius Extavour:
First, I'll just speak to the topic very briefly. So two prizes, both with the word carbon in them. But when you dig in, the objectives are quite different. So whereas, the first one was about making CO2 into stuff. Fundamentally, in the language of decarbonization, that's called mitigation. We're trying to reduce emissions. Carbon removal is a different function. Carbon removal is about a reflection that even if our emissions output, as humanity, goes to zero tomorrow, we probably still have to remediate the existing atmosphere and ocean which is oversaturated with carbon dioxide.

So how does it work structurally? It's actually three prizes in one. The first phase was to stimulate interest and action among young people. So we had a $5,000,000 prize pool just dedicated for student-led proposals. 23 groups from around the world, undergraduate and graduate students with faculty advisors or part of other research groups, but led by students, they've each been awarded $250,000 each to pursue the proposed ideas for carbon removal. And so, that was phase one of the competition that was in November of 2021. Phase two is happening right now. Phase two is, "All right, whether you are a student team or not, we're looking to award 15, $1,000,000 milestone prizes to groups that have the most promising ideas and something already going." Not a full solution, but some element of the solution complete.

And then the third element of this competition is just the finals where we're asking for the whole thing. We want to see a small, but complete carbon removal demonstration. No matter what it looks like, we want to see that it’s actually running, similar to the last competition. It's not the type of thing where, "Okay, I need three days and 10 lab assistants to get the system running." And then it'll run for six minutes like you're sort of maybe just trying to get something off the ground. We want it to be robust, something that looks like it could be real and actually be scaled up. And that is what we're going to spend the next couple of years focused on, this last phase of the competition.

Mike Toffel:
And what are the judging criteria for this? I imagine there's both a market piece, there's a technology piece, there might be a cost piece.

Marcius Extavour:
Yes. So there are three things you've got to do to win this prize and to participate. One, you have to deploy a working system. Before I get into the criteria, I'll say that there are many ways to do carbon removal. The space of solutions is actually huge. It spans everything from farming kelp in the ocean to restoring coastal mangrove populations. Some people talk about stimulating fisheries and large marine mammals. You can use biochar. You can till soils differently, you can maintain or reforest forested areas. You can also build machines to extract CO2 directly from the air or the sea water. You can also use minerals, maybe mine tailings or natural minerals to react with CO2 in the air. So there are many, many ways to do this. Some of them are effective. Some of them are not effective. Some of them are just speculative. Some of them proven, it's all over the place.

So to try to cut through that, but also have a competition that was inclusive of as many meaningful solutions as possible. We're focused on one, does it actually remove CO2 from the air or the ocean? Can we measure it? Is it net negative, meaning on a life cycle basis, does it actually remove CO2 and take it out of circulation, so to speak? A simple test question I have for this is, "If you do your thing more, does the atmospheric CO2 concentration go up or down? If I did this times a million, would it go up or down? If it goes up, it's out, but if it goes down, that's the definition of carbon removal." Is it durable? If you remove it for a day, that's arguably not relevant for our climate situation. If you remove it for a century or more, now we're talking. And there's some debate on that point, but we chose to look at durability as a criteria. There's a cost piece is a second big tranche.

Some of these technologies can generate revenue. Others may not, but we wanted to understand what costs at scale might look like. Measuring the cost at scale of a very early stage technology is a nightmare, to put it bluntly. But we found a method to estimate it, and the most important thing for us was to put all the competitors on an equal cost methodology and cost basis. So we could at least have some basis for comparison, rather than, "Everyone bring your own assumptions and we'll try to sort it out." We said, "No, we are choosing the assumptions. And we'd like everyone to calculate cost exactly this way."

Mike Toffel:
So you're providing a standard framework.

Marcius Extavour:
Exactly.

Mike Toffel:
But allowing for the likelihood that different technology will evolve at different paces just as they have always done in the past. You're not saying everyone's going to decline their cost by 5% every year. Something like that.

Marcius Extavour:
Exactly right. And then the third element is sustainability in scaling. Scaling means, could this be implemented at scale that is large enough to impact climate. And once you get above a million tons of removal capacity, I would say, it starts to get interesting. Collectively, it is believed that we are going to need gigatons of carbon removal by mid-century. Does that mean every individual solution needs to be able to scale to 5, 10, 20 gigatons? No, but it means if we know a priori that the solution has no hope of getting to the gigaton scale, that means it may not be worth pursuing today.

So we have a scalability piece, but there's also sustainability wrapped in with that. Just because you can get to a gigaton doesn't mean it's a good idea. If you get to a gigaton and consume half of earth's electricity, it's probably not a good idea. If you get to five gigatons, but it's the kind of thing that communities detest, it probably won't happen or probably shouldn't happen. So in the sustainable scaling piece, that's where we ask, "In principle, could it grow and in practice, do you have a plan to grow it that's inclusive of social, environmental and economic considerations. So does it work? Do you understand the cost and could it scale?"

Mike Toffel:
And embedded in each of these three, it sounds to me like some of these are scaler. Like you could imagine they're low, medium, high. Or from a cost perspective sort of cost per ton removed. But then some of these also sounded a bit more like thresholds, like for example the permanence question or durability. Maybe if it's below a hundred years, then it's out. Am I understanding it correctly?

Marcius Extavour:
Yes. That's really good. You could be a prize designer actually. Durability is a little bit binary. So our test is, "Could this be durable over a century? Yes or no." If the answer's no, it's out of scope. So that's a challenge to competitors. Some people think it should be much longer, like 500 or a thousand years. Other people argue that, "There is room for solutions that only are durable for five, 10 or 20 years.

Our position was, "We're going with this century. We think it's reasonable. It keeps some of the shorter durability solutions in play, but forces them to come up with a management system that could be longer term without excluding or without insisting that it only be, let's say, a thousand year durability." But at the end of the day, it's a threshold question. If it is carbon negative, we're interested. Or in scope out of scope, I should say.

Mike Toffel:
Mm-hmm (affirmative).

Marcius Extavour:
Scalability, this is a little bit more subjective. So we're asking teams to discuss and asking judges to think about a projection into the future. It'll be scored on some kind of point scale and judges will have a chance to discuss that.

But then there can be performance inside of that. All those elements have to come together, of course, with the input of our judges to communicate clear to the teams what's expected and, "Here's how you win. Here are the rules of this game." But also to let them know what to expect so that they can design and hopefully innovate against those criteria area.

Mike Toffel:
Yeah. So these criteria, it's dawning on me how important the judges are, especially because they're having to make these judgment calls and these forecasts both about the scalability and about the cost curves. So can you say a little bit about how you think about attracting the right mix of skills in the judge panel that you bring together?

Marcius Extavour:
Yes. So this is one of the most interesting things and I think difficult, but also kind of rewarding aspect of a prize. So I said earlier that we like the competitions to be as objective as possible. And I think there's sort of an asymptotic vision of a prize that is so objective that you don't even need a human being to decipher the results. It could be all based on pure measurement. This prize isn't quite that, this prize has a mix of more judged and directly measured criteria. The judges play a really important role in two ways. One in validating the criteria, whether they're more judged or objective. And then second of all, actually doing the discussion and the back and forth to make the subjective calls. Like, "Do we believe the results or let's talk about the assumptions made in the scalability plan." So to get at that, we look for a group of people who are, first of all, diverse in a lot of ways.

We think that cultural and gender diversity is really important in the dynamic of a consensus and discussion mechanism. But also diverse in terms of their backgrounds and experiences. We've divided the solution space into four chunks. We call it air, land, oceans and rocks, and there are many carbon removal solution types in each of those chunks. The chunks don't really matter for the competition in terms of who could win. But we expected solutions of those types, and we made sure we had expertise in those four areas. People that could really look at, for instance, a direct air capture piece of technology or data set, and really understand its inner workings and know what difficult questions to ask, know where the weak spots would be. Ditto for ocean related carbon removal, land based carbon removal and mineralization based carbon removal.

So we have 12 judges in total, their identities are all on our website. they span those four rough categories of solutions. We also looked for a mix of folks from academia, from industry, from public and private sector and people that just sort of have different perspectives on the topic. A lot of the big questions in carbon removal are not resolved. It's a relatively new field, especially, in terms of actually developing and deploying solutions. So we wanted a mix of opinions. We have roughly 50:50 gender ratio, which is also I think helpful fundamentally we really wanted to cover the expertise needed.

The other thing I'll say too is because the response to this prize has been so tremendous, we also recruited 70 scientists to act as the first round of review and screening for this milestone evaluation round that we're going through now.When you have a crowdsource competition, frankly, sometimes you get a few things that just make no sense or a much larger pool of things that make sense, but are just out of scope. Great idea for a battery, fantastic, could be helpful for climate, not in scope for what we're doing here. Or emission avoiding solutions, also fantastic, but that's actually not carbon removal.

I think you see the theme here, covering the expertise that's needed, finding folks that know how to ask difficult questions. And in the judges in particular, people that are comfortable comparing technologies or solutions that may not be similar to one another, how do you compare a tree planting proposal to a mineralization proposal? They're quite different to be able to at least understand the nuance of each and then come back to the criteria. "Does it work? Do we understand the costs? Could it scale?" And being able to make those determinations for any solution type.

Mike Toffel:
That's super interesting to hear about how you assemble even these additional judges for the prescreen. So you've received several hundred entrants to this latest prize.

Marcius Extavour:
That's exactly right. So we haven't published our figures yet, but I can say we've broken all XPRIZE records. We thought the expert review panel, as we called it, this technical screening panel would be helpful in any circumstance. But it became a necessity just due to the volume of inbound. But actually I'm really thrilled with the way it's gone. Their names are also on our website. But we think this is the largest review of carbon removal proposals that's been conducted anywhere to date.

We have a lot of interesting data from the process that we're looking forward to publishing later in the year, just on how this worked, what worked, what didn't work, how we structured this review process and how we might do it differently next time.

And then of course, just the data on the competitors themselves. What stages are they at? What kind of solutions seem more mature? What kind of solutions seem less mature? I think we'll have an interesting sample from which to share some results.

Mike Toffel:
And when should we expect to learn the victors of this competition?

Marcius Extavour:
So we are aiming for Earth Day 2022, which is April 22nd this year. So that is when we are going to say, "Congratulations to these 15 groups, they've each won a million dollars. Go forth, build your solutions." The other message you'll hear from XPRIZE is, "Everyone else that competed, thank you. And don't forget, you can still win the grand prize. We're not funneling down, whether you competed in this milestone round or chose to skip it or had never heard of the prize and don't hear about it till next year, you could still win the grand prize if you have the best carbon renewable solution working when the prize ends." But in addition to announcing the 15 and trying to talk about what they do and what it means, we are also going to share the lists of sort of the best looking solutions, according to these reviewers and judges, and also the complete list of everyone that submitted a complete in scope proposal.

Because frankly, we want to continue to support them through the rest of the competition and to draw attention to their work because we think they could be great fits for other programs. Granting programs. There might be other prizes that spring up, there are incubators and accelerators. There's a community of investors looking to connect with early stage startups. So as a nonprofit, we're in a nice position because we can share this data. We don't need to sit on it. Our goal is to grow the community and we think sharing this data is one way to do that.

Mike Toffel:
So let's step up a level reflecting on the prizes that you've been involved with, what are some common mistakes you're seeing folks make in their early entries? And are there any commonalities of the victors that you're starting to get a sense of, "Oh, I can kind of predict who might be more likely to win."?

Marcius Extavour:
There certainly are some themes and, this is where I'll put on my pretend investor hat. One thing that I've noticed, not just in the carbon removal space, but I see it in the climate tech space more generally is there's a maturation that occurs when people first start working on solutions. And especially, as we see a lot of people coming into the space, you often first see people describe in their pitch decks or in their presentations or the way they speak about their approach. They start with the problem of climate. They say, "Climate's a big problem. It's really bad. Got to do something about it. We know what to do. We're going to do X, Y, Z."

And I have learned by watching investor responses and how folks respond that the maturation that needs to happen is to not necessarily start with, "I'm working on climate." But start with, "This is the specific and narrow problem that we are solving with this solution." We're not going to start with, "We need carbon removal." I'm going to start with, "Let's assume we want to do this. I'm going to explain to you why my direct air capture system, how it exactly works and why it's better than the others, or why it's the most scalable." So it's a narrowing of the focus on not the broad problem space, but the specific problem that this specific solution solves and its specific benefits. If the benefit is revenue, then how does that feed back to the investors or the broader community? If the benefit is a community service or an ecosystem benefit, let's say, improving the quality of a top soil. That can have economic, but obviously social benefit then leaning into that.

And so the groups that I've seen successful figure that out And then when you see them pitch the next time or the third time you say, "Oh, they're not starting with a picture of planet earth." Nothing wrong with that, but it turns out people that are focused on scaling solutions, I think, like to get to the key problem first and then put that into the broader context, so that's one thing I've seen. Second thing, and you see this in a lot of early stage startups, research groups, just trying to start to become a little more commercial or focused on a particular deployment outcome is they tend to be run by the subject matter experts from the science or engineering community. And that may or may not translate well into operational, organizational and business skills.

Does that scientist founder, let's say, have what it takes to also lead a team or make a business plan or secure partners or investors or supporters or whatever it takes to grow the solution? So we see a maturation of people that don't necessarily come from ecology or chemical engineering or that kind of background partnering up with those folks to produce probably in the end, better quality teams and better quality companies or organizations, or depending on how they structure them. So I'm sure that's familiar with people listening. We see it in a lot of different industries, but we see it here in climate tech too.

The last thing I would say is, and this is probably the hardest one, climate tech... There's a big debate for a long time, clean tech, climate tech, these sort of hard science based, non-software or non-media oriented businesses. There's a big question about, how venture backable are they? Are they the type of solution that produces a business that could be venture investible or do they need a different type of scaling path? Venture capital is sort of the knee jerk reaction, I think, for innovation because of the incredible success of Silicon valley over the last generation. but that is not necessarily how you scale the business of something that moves atoms and not bits, as people say.

So my point is the recognition of how they need to scale. Maybe through strategic partnerships, probably, longer gestation periods, probably, more capital intensive. The maturation of that thinking is something that I see a lot among these groups. And it's something we think a lot about at XPRIZE because we try to understand that landscape when we design prizes, when we design these diligence interventions, the metrics. But also it's something that I see in the cohort of innovators, especially at the early stage. And I think it's something we're already seeing in this carbon removal prize as well.

Mike Toffel:
Let's close with a question about your journey and for those who are interested in getting into the space of business and climate change, what advice you might have for them. But maybe we could begin by having you reflect on how you ended up at XPRIZE and what your journey was.

Marcius Extavour:
For me, I'm interested in this space because it's intellectually interesting. I think climate change is fascinating. It is complex. It's scary. It's deep. It's a huge topic. I don't say that to make light of it, but for me, it's something that is never dull. It also is a huge opportunity to do something with deep meaning, intergenerational meaning. I don't want to get too sort of high minded here, but it's appealing to me to work on something that I think can have meaning for my community, the broader global community, in my lifetime. And even in my kids and hopefully grandkids lifetime.

We are just at the cusp of the climate problem and the business world coming together. And I think that if we succeed, this will be a major theme of the next generation and probably the next century is, how to bring these two things together which, frankly, have been kept separate up till now. I'd say that's an articulation of the whole problem. We have not been trying to solve our business and economic and social objectives at the same time as our environmental objectives. And if we can find a way to solve them or to address them together rather than as one or the other, I think we're on the right track.

Okay. So, how did I end up here? Maybe I'll sort of go back in time. So I really started out life as a pretty traditional engineering and science person.

Marcius Extavour:
But as a graduate student, I really started to become interested in climate change and energy. Great thing about being on campus, you have access to a lot of seminars, departments around the corner or another building. You can go chat with people that do completely different things. So I tried to take advantage of that. Just started learning, teaching myself, reading papers, going to seminars, talking to people, going to conferences.

And I wrapped up my PhD and I worked as a quant at a power company, looking at financial and market risk and project risk associated with energy products and the electricity markets.

So that was a great lesson in how the business of energy works. I was able to sort of parlay that into a fellowship to work in DC at the Hill in the Energy Committee. I'm understanding how legislation is made, how regulations are made or not made, how the Senate operates, how the Hill works, which I found really helpful and valuable.

So the story of my career for a while was sort of identifying skills that I didn't have and then trying to add them or experiences.

Then I found out XPRIZE was starting to do energy work. I thought, "Okay, well I'm not sure prizes and energy will work together, to be honest, because energy is a very heavily regulated industry. It's very capital intensive." But I also was curious and wanted to find out for myself.

And so I've been at XPRIZE a few years now and I've had the chance to work on a prize, I've designed prizes. I like it because it's a combination of the deep technical stuff and thinking about what's the best way to create a set of incentives, which is a bit more like game design or market theory.

We get to try to actively inspire a broader community of people. And it's a rare place to try to bring those different elements together. Policy, technology, engagement. The last thing I'll say is you meet a lot of really interesting people, really extremely motivated people, very creative people, sometimes some unusual personalities, people that are thinking about things a little bit differently, people that sometimes really want to go for it. And that's pretty fun to be around folks like that.

Mike Toffel:
So there's a lot of interesting lessons from your own journey. What advice do you have for MBA students or alumni who are thinking, "I'm interested in this business of climate space." What resources or people or ways of thinking, would you advise that they engage in to sort of find out about those opportunities?

Marcius Extavour:
In terms of finding out opportunities, here's a non-exhaustive list of a few things to check out. In the carbon removal world, there's a Slack community called AirMiners, great community, very welcoming. It's not exclusively carbon removal, but it's mostly that. But you find a lot of other people that are interested in what they're calling climate tech. Again, because carbon removal is so broad, don't just think direct air capture, even though that's a great approach. So it gets into ecology, it gets into agriculture, it gets into mining, ocean. So there's a lot of biodiversity overlap there and it industrial decarbonization overlap. So that's AirMiners, a Slack channel. There's another great Slack channel called New Energy Nexus. I like to be part of that community.

It has a more professional feel. A lot of organizations are there. I think it's a larger. It's a little less climatey, a little more energy, but that's a great one. Discord is another place for online communities. The crypto and Web 3.0 world love Discord. The gaming world loves Discord, but I'm starting to see some climate and energy projects sort of try to organize on Discord. Discord and Slack are quite similar. That's an online sort of message based community tool. Here's another great resource, a newsletter called Climate Tech dot VC.

As you might guess, it's really focused on venture capital, but they share a lot of great data on the venture space, on the investing space. And through that lens, they look a lot at just different elements of this climate tech space. In terms of things I would suggest or pieces of advice. Something I like to say is, I like to suggest to science folks to learn something about business and economics, even a little. Just pick something, finance, economics. Read The Economist every day for two months. Just to start to get familiar, not just with the terminology and the concepts, but the way people think that approach problems from that direction. Because it's really interesting and additive to the way we're taught to think from the science world. But in reverse for people that are more comfortable with that, whether it's economic business, business planning, finance, other areas that you'll come across probably at business school is to get to know something about technology. hard tech or science or engineering. Maybe it's a little bit of ecology or the science of agriculture, or maybe it's oceans, or maybe it's just things like manufacturing, because these considerations... Again, I'm not saying try to be an expert, but either make some friends or do some cursory reading to try to just start to get familiar with some of the terms and approaches. The National Academies of Science publishes pretty dense, but at least accessible and available reports that you can skim, download executive summaries of. Another great tip is to... I don't mean to be facetious, but read one of the IPCC reports. Let's be honest, most people don't read these things.

Mike Toffel:
They're dense.

Marcius Extavour:
And we talk about them, we don't read them. They're huge. Okay.

Mike Toffel:
They're long.

Marcius Extavour:
But there's always a summary for policy makers.

Mike Toffel:
Right.

Marcius Extavour:
It's usually written in plain-ish English. It's about 35 pages. That is a skimmable document.

Mike Toffel:
Yeah.

Marcius Extavour:
Start with that. That's a document that is almost like an encyclopedia. It's so dense with data and information, but the summaries are a helpful way to just kind of start to orient yourself with the documents almost, so that where to then surgically look things up in future.

Mike Toffel:
Yep. And great graphics as well.

Marcius Extavour:
Exactly fantastic source of graphics. I've used many in talks and things like that. It's partly my personality and my style, but I'm a big fan of that kind of cross knowledge exchange,. The last thing I would say too is, there's opportunity for more people to be thinking about the problem, not less. There can be some strains between people that are new and people that have been there for a long time. Climate has this funny dynamic where many of the climate results we talk about today are not new to the professionals that have been working on them for decades. And so those professionals are sort of thinking, "We've been saying this for 20, 30, 40 years and suddenly you're interested in it." There can be a little bit of that, which is fair. It's normal.

Mike Toffel:
Yeah.

Marcius Extavour:
So I would say for people that are diving into the space, be aware that you may encounter that, be respectful. But if you're coming in, because you want to learn and with a bit of humility, you will learn a lot. But also don't be afraid to bring your own fresh ideas because the space needs that. We need new people to think about these problems in new ways. These are solvable problems, I believe that really firmly. We have the capacity to solve this problem. It's not easy, but it's the interest of people that want to think differently about things or just execute on classic ideas that are going to make all the difference.

Mike Toffel:
Great. Well, it seems like a terrific opportunity to end on that optimistic note and we'll include links to many of these materials in the show notes. So thank you so much for spending some time with us on Climate Rising. It's been a real interesting conversation.

Marcius Extavour:
Thank you so much for having me. It's been a real pleasure.