Podcast
Podcast
- 30 Nov 2022
- Climate Rising
Tech-based Carbon Removal: Sustaera’s Direct Air Capture
Resources
- Company information:
- Sustaera
- Sustaera’s technology
- Backgrounders on Direct Air Capture:
- Direct Air Capture (International Energy Agency)
- 6 Things to Know About Direct Air Capture (World Resources Institute)
- The Inflation Reduction Act gives carbon removal a big boost (Atlantic Council)
- Direct Air Capture companies mentioned in the episode:
- Breakthrough Energy Ventures (tech fund)
- Frontier carbon removal project
Guests
Climate Rising Host: Professor Mike Toffel, Faculty Chair, Business & Environment Initiative
Guest: Shantanu Agarwal, Co-Founder and Director, Sustaera
Transcript
Editor’s Note: The following was prepared by a machine algorithm, and may not perfectly reflect the audio file of the interview.
Shantanu Agarwal:The objective is to lower the cost of this direct air capture system to be somewhere around $100 a ton over the long term, and be able to do it on an industrial scale that can be done at massive million tons per annum, or tens of millions tons per annum, in the middle of nowhere. So that you can essentially create a gigaton type of solution and be able to industrialize carbon removal.
Mike Toffel:This is Climate Rising, a podcast from Harvard Business School, and I'm your host, Mike Toffel, a professor here at HBS. In today's episode, I'm speaking with Shantanu Agarwal, Co-founder and Director of Sustaera. Sustaera is a startup company developing a direct air capture solution, which is one of the leading types of technology based carbon removal. We'll talk about how direct air capture works and discuss Sustaera's technology approach and how it fits into the broader carbon removal landscape. And as usual, I'll ask Shantanu to share some advice for those interested in working at the intersection of business and climate change. This topic covers a lot of technical terms and abbreviations, including direct air capture being referred to as DAC. We'll do our best to define them in the interview, and we'll include some resources and definitions in the show notes at climaterising.org. Here's my interview with Shantanu Agarwal of Sustaera. Shantanu, thank you so much for joining us here on Climate Rising.
Shantanu Agarwal:Thank you Professor Toffel. It's a pleasure.
Mike Toffel:So we get the opportunity to welcome you back to HBS, where you were a student here from 2008 to 2010, and you've gone off and been involved with many different startups. Today we're here to talk about your role at Sustaera. Why don't we start with that? Can you just give a brief introduction and what your role is at Sustaera, what it has been and what it is now?
Shantanu Agarwal:So maybe to start with, give you a little background on how it all happened and how Susteon and Sustaera actually came about. I was happily working away in a private equity firm in energy technologies and obviously aware of the climate change problem, wanted to do something about it. That's when I met a group of scientists in the North Carolina RTP area and we banded together to start Susteon as a R&D incubator of sorts. And that's where we've been playing around with a lot of technologies in carbon capture and carbon utilization. My Co-founder, Raghubir Gupta, is the prime technology driver for that. Having started that in 2017, we played around with quite a few technologies through early 2018 and '19. And then in collaboration with Columbia University, found a technology which was quite intriguing in terms of the chemical properties, and allowed us to sort of build a quite differentiated value proposition for direct air capture of CO2. And that's how Sustaera happened and we spun it out into its own company and raised money and kind of growing that quite significantly now.
Mike Toffel:Great. And when you were searching for this technology, were you looking for a direct air capture technology or were you more broadly looking for technologies that resonated with your engineering background?
Shantanu Agarwal:The original business model with which I and my co-founder started Susteon was around us having a deep desire to make a dent in the climate change problem. We knew that there's quite a few interesting science concepts, which are out there in the sort of research infrastructure of US, and we were sort of filtering through a lot of these interesting science concepts, talking to collaborators, innovators, researchers, professors, all across the US and even some Canada and UK. As we evaluated those technologies, we would come up with certain ones which had potential, in our views. So we would then collaborate with those innovators to joint research to further the TRL level, or technology readiness level, of that technology.
We were kind of agnostic in that as long as the technology had potential in the whole climate impact domain, and was something which we could actually add value to, we would take it on. So a lot of the stuff which we were working on was in the carbon capture domain, because of that point source and direct air capture. And similarly, we also worked on carbon conversion and hydrogen. So over the period of time we actually evaluated and worked on more than 35, 40 different technologies. And at this early stage, there's a high failure rate as well. So more than 50, 60% of those failed. So we evaluated and worked up joint research projects on a bunch of these, and some of them have succeeded and some of them have succeeded quite well. The director capture technology in Sustaera being one of the very good successes.
Mike Toffel:And let's just go back, there's a lot of jargon in this space. So you distinguished point source versus direct air capture. Just to put a little clarity, point source means a more carbon rich environment like a smoke stack emission, for example, versus direct air capture being more oriented toward ambient air. Is that the right distinction there?
Shantanu Agarwal:Yes, that is correct. So point source is any source which is actually has a concentrated stream of CO2, and a concentrated stream of CO2 could be as low as a 2% concentrate, because even that is a 100 x or 1000 x more than what the environment is sitting at. The environment is at 0.04%, or 400 ppm.
Mike Toffel:And you mentioned conversion, just can you explain what that term is in this context?
Shantanu Agarwal:A lot of the work going on right now is trying to figure out, wanting to do something with the CO2 which we are capturing and concentrating. And if you can actually produce something which is useful, that actually helps with the overall economics because otherwise you're only left with the option of pushing it down into the earth. And that is essentially, I mean, yes, you're creating a garbage and converting that garbage into putting it down deep into the earth. And that's fine, but if you can actually produce some useful product out of it, then that's more of an economic and a value creative step. And that's what we call carbon utilization, when you take CO2 and you convert it to something. There's a lot of different projects working on that where people are trying to take CO2 and make methanol or ethanol or one of the starting building block chemicals like ethylene, which will allow for a lot of plastics to be made. Or even sustainable aviation fuel, where you can make jet fuel out of CO2. So all those things are in the carbon utilization domain.
Mike Toffel:Right. But we're going to talk for today's conversation more upstream, like how do we acquire that carbon? How do we remove it from the atmosphere or remove it from point sources? As we talked about in a prior episode, there's both nature-based solutions to removing carbon, and there's technology based approaches. And so today's conversation, we're really going to focus on technology based, of which direct air capture is one example. Can you take us through the landscape of what are the various types of technology based carbon removal that are out there, that are being commercialized or researched at the moment
Shantanu Agarwal:In terms of the technology based solutions for carbon capture, there is a point source capture, and then there is the air based capture, or direct air capture. In the point source capture, there's an established technology and technologies which are all around mostly amine based solvent systems, which are used for capturing CO2 from industrial source or a power plant source. And these have been used for quite a while in the sort of existing industrial setup, but they need to be scaled and new plants have to be built with these point source capture systems in place, and a lot of the existing plants have to be retrofitted. So there is a huge industry to be created in this point source capture technology piece, which is mostly installation of an existing established technology play.
Mike Toffel:So a fairly mature technology play on this side, but the kicker is it has to be where there's a target rich environment, meaning smokestacks, either power plants or industrial sites?
Shantanu Agarwal:Absolutely.
Mike Toffel:Got it. And so the other side is the ambient air, and there there's a couple of options as well.
Shantanu Agarwal:Absolutely. So the air based systems, these are new. This is a whole new domain which has opened up because people started investing in carbon removal. The concentration of CO2 in air is 419 ppm, which is equivalent to one ton of CO2 for 3000 tons of air. So you have to sift through 3000 tons of air to be able to capture one ton of CO2. It's really not, if you think of it, very pertinent or something which lends itself to taking it out because it has such a low concentration of CO2 in it. So historically, nobody wanted to touch air as a system for taking CO2 out, but that is the ecosystem in which we have been dumping CO2 out. And for us to create negative emissions, we have to figure out a pathway to taking CO2 out of this low concentration form as well. Over the last 10 years and more so in the last three, four years, there's a lot of momentum around this whole domain where now technologies have emerged. And in that there is the bio-energy based pathway where essentially the-
PART 1 OF 4 ENDS [00:09:04]
Shantanu Agarwal:... energy based pathway where essentially the biome or the biosphere is being used to take CO2 out of the air and convert it to some sort of biomaterial, and that biomaterial is then used to isolate the CO2 either in the form of actually CO2 when you are burning it and generating energy, which is the case for BECCS, where you take a biomass material, burn it, generate electricity, and take the result in CO2 and put it down into the earth, so you're capturing CO2 at the same time you're generating energy. Then there are other flavors of it where you're taking bioenergy and pyrolyzing it to make biochar which can then be either put down on the earth or spread on agricultural fields making that char like material capture CO2 which cannot be changed back very easily. Or there are companies which are actually making biomass and then converting it into bio oil, and then putting that oil down into the earth. So that's one segment of companies which are taking a biomass-based pathway to convert CO2 from air into some sort of biomaterial, and then using that to sequester CO2.
Mike Toffel:So there's burning it which produces electricity, and at the same time you're capturing the CO2 and burying it. There's pyrolyzing it, converting it into biochar and making the carbon unavailable, although you can maybe spread it, it just becomes unavailable to leak into the atmosphere. And then there's the bio oil production which then you can bury that. Say a word if you could about pyrolyzing for our listeners who are unfamiliar with that process.
Shantanu Agarwal:Yeah. Pyrolyzing essentially means heating biomaterial or any kind of plant material, to a very high temperature without the presence of oxygen. So it essentially chars it and converts it into a black slushy material which dries up eventually so it becomes like a char, think charcoal. Charcoal is made by pyrolyzing coal, biochar is made by pyrolyzing biomaterial.
Mike Toffel:Okay, great. This is the bioenergy leg of approaches to take CO2 out of the air, and then there's a whole nother set of technologies that are based on chemistry and mechanical properties which are largely known as direct air capture. Can you tell us about what that landscape looks like?
Shantanu Agarwal:There is a huge bunch of those kind of technologies as well now, quite a varied amount of approaches are being tried at that in terms of the chemistry of the sorbent materials which can be utilized, and the mechanical contraptions of how you can actually do that. Invariably, this whole domain of engineering-based CO2 capture from air depends on some sort of sorbent material which is cycled into an adsorption cycle where it's adsorbing CO2 from air, and then a desorption cycle where it's desorping that CO2 which has adsorbed during the adsorption phase, and desorbes it into a concentrated CO2 stream, and then is recycled back to adsorb again. So it basically goes through an adsorption, desorption, adsorption, desorption, almost like a Tom Cycle manufacture.
Mike Toffel:And this is what increases the concentration?
Shantanu Agarwal:That's right. There are companies which are trying to use the existing cooling towers and use that setup to expose the air to the sorbent material and capture CO2 there. There are companies which are building custom type of cooling towers or air conductors to be more precise, which are customized for their particular process to expose their sorbent. For example, Climeworks uses amine based sorbent material, and they've got a fan which is horizontally placed and that exposes their sorbent material to that airflow. A similar type of system is there for another company called Global Thermostat which uses a mean based system, but it is placing these amines in a honeycomb like structures which are exposing large amount of surface area to contact with air. These materials are called monolith materials, and again, they're cycling the sorbent from adsorption to a desorption cycle. There's another company called Carbon Engineering which is using a liquid based capture agent where they're exposing the air to a flow of alkaline liquid, that alkaline liquid then reacts with the CO2 and captures it.
What I'm trying to get at is, there is a variety of different processes which people are trying to figure out a pathway which can be the lowest cost and most scalable to allow for engineering based director capture to happen at scale because the objective is to lower the cost of this direct air capture system to be somewhere around a hundred dollars a ton over the long-term, and be able to do it on industrial scale where it can be done at massive million tons per annum or tens of million tons per annum in the middle of nowhere so that you can essentially create a giga ton type of solution and be able to industrialize carbon removal.
Mike Toffel:So there sounds like a race between these different chemical and mechanical processes. These different companies are placing bets on different formulations and their ability to go down a learning curve to reduce costs while at the same time trying to figure out how to scale up in a way that gets them down to this magical something like a hundred dollars per ton or something like that. Where are the costs today in the direct air capture space? I imagine they're quite a bit higher in some cases at least than a hundred dollars a ton.
Shantanu Agarwal:I would say most of them are in the ballpark of $500 a ton, if not even more, and they're all working towards figuring out an engineering path. A lot of them are actually building their first pilot plant right now, so even calling them that their cost is $500 or $700 is really meaningless because they haven't got a working commercial unit which is operating. It's all on paper at this point. So all of these companies have to build their first units, demonstrate their technology and showcase that it actually has a engineering and a clear scientific pathway to reduce the cost down to a hundred dollars a ton.
Why we believe in that, is because there's a very good precedent of us being able to reduce cost in these scale up mechanisms which we have done in the case of solar industry, in the wind industry and the lithium battery industry, so the same pathway and cost reduction cycle can very much be applied to what carbon removal is being put towards. All you need is really viable chemistry and a mechanical pathway, and then the attributes of how industrialization happens and how scale up happens in a giga factory will allow that cost to come down. The belief of the investment groups which are investing in this and the overall industry is that we have a very good chat at bringing the cost down of engineered back to hundred dollars in the long run For sure.
Mike Toffel:And who's funding these various ventures? Is this coming from government loans, like from Department of Energy, grants or loans programs? Are these private investors? Are these the brands that are committing themselves to net zero? Are they also placing bets on technology? What's the funding source?
Shantanu Agarwal:It's a mixed bag. A lot of investment companies actually have taken interest, which were traditionally not really investors in these kind of domains at all. A lot of tech funds have created their own clean tech funds. Breakthrough Energy Ventures probably was one of the leading funds which started investing in this domain, but there are a lot of other foundations and other groups which have also seeded up the money for the early stage funding for Climeworks, for example. There's a lot of Swiss funding and a lot of philanthropic funding which came through to allow them to build their technology into a place where now they have investors which are more professional investors and more traditional investors who are equity return incentivized rather than the traditional philanthropic type of money which came in early.
So what I would say is that, it starts out with a lot of philanthropic and more climate focused funds which started the ball rolling, but now a lot of people have got on the bandwagon, and a lot of traditional funds and traditional groups which have started their climate groups are very much interested in this because they see that direct air capture is going to become one of the major industries of the future. It's a trillion dollar opportunity.
Mike Toffel:So we've talked about the cost seeking a hundred dollars per ton for carbon removal as a goal. There's trillion dollar opportunity, lots of entrance into the investment space. This is all predicated on massive demand for carbon removal. Where do you envision that massive demand coming from?
Shantanu Agarwal:The massive demand is here. As mankind, we are right now still emitting 40 giga ton per annum, within six, seven years...
PART 2 OF 4 ENDS [00:18:04]
Shantanu Agarwal:40 gigaton per annum within six, seven years where we would have crossed the one and a half degrees at the current rate, and another 10 to 15 years after that, we would be at two degrees. So, we need the massive mitigation plan to reduce our rate at which we are emitting gigatons of CO2 out into the air. With all estimates out there, we need at least five gigaton, if not 10 gigaton by 2050 of negative emissions. Now, just to give you that in more digestible numbers, from 2025 onwards, we need to scale 5,000 X to be at the most conservative amount of CO2 removal, which we need to do as mankind.
Mike Toffel:That's the case if we're going to meet a two degrees warming scenario based on current forecast.
Shantanu Agarwal:That is correct.
Mike Toffel:So, you're pointing out the societal need for these technologies to actually meet that two degree target. It's not at all clear to me that in fact, society will agree to make those investments. So far, we're talking about this sort of latent demand if we agree to meet those targets. But there needs to be a transition from latent demand to actual demand, and that I imagine is going to come either through government action, which creates incentives for folks to have to procure carbon removal or avoidance credits or from private sector actors who are trying to realize the commitments of net zero and the science-based targets that they have proclaimed, but not necessarily acted aggressively against. So, do you see both of these channels leading to material actual demand as opposed to latent demand?
Shantanu Agarwal:I wanted to give you the sort of large scale societal prerogative. Now, in terms of the signals which are coming into the market, first of all, there is a fairly significant voluntary carbon market, which is now taking form and there's quite a significant demand for permanent carbon removal rather than just temporary, more nature-based type of removal, which has been more of the flavor of the world. And that shift is happening quite significantly and quite strategically by most of these buyers who are committed to net zero and want to show it in their balance sheet and show it to the shareholders that they're actually taking action.
There are large funds which have started leading the charge on that, for example, the Frontier Fund, which has been formed with the help of Stripe and McKinsey and a bunch of other companies in the tech domain to come together to put the $1 billion to work for making carbon removal purchases in advance to help generate some momentum around these companies. There's a large voluntary market, which is taking shape. And on top of that, the Inflation Reduction Act recently put into place a $180 price marker from the US Treasury, which essentially gives a 10 year leeway here from today to about 2033 for any of the carbon removal companies to go out there and build and sell the removed carbon credits to the Treasury for $180 per ton if it has been taken away from the air and then sequestered down into the earth. There is similar sort of incentives and programs being put in place in other countries, specifically Europe and Canada are also quite significantly enjoined into this whole direction.
Mike Toffel:Let's dive into Sustaera, the company that you've found and led. How does it differentiate itself from these other plays? So, your competition will be these other direct air capture companies, they'll be the other bioenergy companies, and to some extent, maybe, depending on who the consumer is, it could be folks who would also consider this as an alternative to point source and maybe even nature-based solutions. So, if you're a company that says, "I just need carbon credits to reach my net zero goal," there's a lot of differences between them. How does Sustaera plan to stand out?
Shantanu Agarwal:First of all, I'm not running Sustaera, we've got a very capable CEO in Mary Haas, who's running Sustaera now. I did found it with my co-founder, Raghubir, and we commercialized it and raised the money and now I'm on the board. How we are differentiating is in the way that we have got multiple aspects of that technology set up, which allow us to be a low cost, highly scalable, almost modular system, which we can deploy on the fly. Now, one of the biggest differentiators of a sorbent material, our sorbent is based on a abundantly available material, which is quite established in terms of the supply chain, which it already exists. And it is cheap, so that allows us to first of all have a lower cost as compared to some of the other competitors. So, we have a more reliable, highly active, kinetically superior system, which allows us to sort of differentiate against the existing amine-based competitors. Allows the system to be, first of all cheap, allows it to be having a standard structure, standard, almost like Lego block type of architecture. And allows it to be built at scale and deployable such that we can actually get multiples of these in the field and get that to a million ton scale quicker than any of the other competitors who are trying to, in some case, build quite massive units, which they have to do at individual scales to prove at each scale. We are building a unit, which is going to be a smaller unit, which can then go end number off. The idea being just like a solar farm where you have a single panel and then you just put multiple panels out there in the farm to have a massive five gigawatt set up, we are hoping to have a similar setup where we have a standardized unit, which you can have end number off to really have as much capacity as you want. We are going to produce these standard units in a giga factory-type of setup, so that we can have a cost reduction, almost like a car where you're producing lots of them, so the individual cost of a single car goes down.
Mike Toffel:So, what will it look like once you've deployed a unit? Will it contain its own power structure? Will it have its own solar panels or its own wind farm, so that all the electricity... You mentioned it's an electricity-intensive process, that itself will be sort of built to be green off the microgrid? Is that how you're thinking about this?
Shantanu Agarwal:Our process requires us to have an access to a renewable electricity, so we can either pull it off a existing renewable power plant, which is there nearby, which can actually supply that electricity to us, or we can co-site and co-build a renewable power plant on the site where we are building these units. The beauty of our system is that it doesn't need a lot more apart from electricity and a place to put the CO2, so we could be in the middle of nowhere in someplace Wyoming or not Dakota, and we could have a large track to land where we are putting windmills and our solar farm and batteries to really generate electricity and then use that electricity to capture CO2 from there because CO2 is everywhere. And we can essentially capture it out there in the middle of nowhere and put it down into the earth.
And the vision would be, yes, there's a large solar farm and besides it, there is a large carbon removal farm. Think of it like a small cooling tower, which has essentially got a fan at the top, which is sucking air from the top and air is being sucked in from the sides of this cooling tower. Let's say it's a small cooling tower, about 10, 15 meter high, let's say, I'm just giving you a vision, and on the sides, air is being sucked into it and the sides have this sorbent material, which is absorbing the CO2 out of the air. As the air comes into that tower, it leaves from the top, and the air which is coming out of the top doesn't have CO2 anymore because the CO2 has been absorbed into the sorbent material. And then that CO2 is concentrated and taken out from that sorbent material and then it's pipelined into a pipe network which is set up on that site, and then that CO2 gets pumped into the earth.
Mike Toffel:Yeah. So, unlike many siting decisions about proximity to supply chain or proximity to customer base, the issues that you face are quite different. They're-
PART 3 OF 4 ENDS [00:27:04]
Mike Toffel:... base, the issues that you face are quite different. They're proximity to low-cost electricity; renewable electricity production, windy or sunny areas, for example; access by rail or truck to get the equipment there and perhaps service it periodically; and then the ability to actually drill into the earth to sequester, if you're sequestering it right there on site. So are those the main characteristics that you're thinking about when you think about siting decisions?
Shantanu Agarwal:That is correct. And today, as it stands, sequestration sites is the biggest problem, because right now we don't have as many sequestration sites in the continental US. So right now, we are all restricted by that because EPA has a backlog of Class VI wells, which it's trying to slowly certify. So that defines today's decisions.
Mike Toffel:So this is the part where you're drilling into the earth to ensure it's done safely and properly and with permanence?
Shantanu Agarwal:That is correct. They're called Class VI wells. These are the wells which allow you to put CO2 down under the earth.
Mike Toffel:Where do you expect these sites to be predominant? Are they going to be distributed throughout the world? Are there some countries that we're going to expect to see a lot of these? How do you think about that?
Shantanu Agarwal:So the location of the siting of this particular industry will depend on, at the end of the day, like any other industry, on economics. Now, for example, the IRA is incentivizing the companies to put those factories up in the US, because that's where the Inflation Reduction Act credits will be paid for. And that's rightly so, because the US taxpayer should be paying for the industry to be created in the US, and this is a new trillion-dollar industry, which the US should take a big chunk of.
But at the same time, there will be geographically and naturally favorable locations in the world where electricity is very cheap. For example, Iceland has very cheap electricity. That's the reason a bunch of the aluminum industry moved to Iceland, because of cheap energy.
Mike Toffel:What is it that makes electricity cheap in Iceland.
Shantanu Agarwal:There's a bunch of geothermal energy. It's cold and there's a lot of heat from the earth exposed at a very shallow depth. So you can actually make geothermal energy very cheaply. Those kind of sites lend themselves to provide cheap energy to do these kind of things at large scale, and that's the reason client works put their first site in Iceland.
But at the same time, manufacturing, supply chains, professional skilled employees who can actually maintain these units, and at the end of the day, the customers who are paying for this, are all going to define the overall economics and it'll drive where these things will be sited.
I think in the short term, in the next five to 10 years, most of these will be sited in the Western hemisphere, US, North America and Europe, and then they will eventually go into the rest of the world, at least in Asia.
Mike Toffel:Let's step up a level. So you had an entrepreneurial background with an engineering degree and then an MBA from Harvard Business School, and you mentioned you were an investor and then you wanted to pursue some entrepreneurial ventures. Of the whole world of entrepreneurialism, what led you into direct air capture as an area? You could have gone anywhere.
Shantanu Agarwal:Yeah, so I'm a chemical engineer, and I was working and deploying capital in the energy technology world. If we're not working and solving climate change, then if I had the means in the technical background as a chemical engineer to at least think in that direction, I thought this would be the best use of my time and energies.
My goal was to really make a dent in the climate-change problem. I was not particularly going after direct air capture when we started. We were looking at, as I said, a bunch of different technologies out there, all around how do we actually take the CO2 out of the environment from point sources or from air?
And we actually stumbled upon this technology, having worked with some of the other players who are now more established and were working in the direct air capture domain. We were already aware of the challenges they were facing, and then we found this particular technology set, which we thought could actually solve some of those problems. So that's how we stumbled into this and then we grew it.
My journey is more accidental than planned, I would say, but the intention was always to try to do something in the climate-change domain, which has really led me to where I am.
Mike Toffel:Interesting. So some of our listeners are considering dedicating their careers at the intersection of business and climate change. Now, some of them will have a technical background, as you did, but many of them, of course, do not. What do you see as the biggest opportunities, and what advice do you have for them?
Shantanu Agarwal:Firstly, I'll caveat and tell everyone that I do not think that you need a technical background to make an impact on the climate-change problem. The whole climate-change problem is the problem for a generation, and we need as many intelligent, driven, business-oriented people who are coming into this domain to really help create these business models, help create these new ideas, and germinate them into businesses which can actually help make a dent in this problem.
Advice for somebody who's coming out is that there is a ton of opportunity right now in terms of just using traditional technologies and applying them to climate change. Similarly, all these industries today which exist in their traditional form will have to figure out how to adapt to the climate-change problem. That means they have to figure out how to reduce their emissions, how to start accounting for their carbon, how to start figuring out not only Scope I, Scope II, but also Scope III emissions. So even if you have expertise in making biscuits, that biscuit company needs a solution. If you have experience in software, then there's a software solution for these different types of industries to apply for climate change.
So we are just at the start of this whole climate-change awareness and the permutation of the current industry, the way it operates to be a climate-conscious industry, and that spins out a bunch of different opportunities. Straightaway there are opportunities which the IRA has put together where there is a price already on carbon for point source; there's price already on direct air capture or air-based removal.
Then you can actually join a bunch of these startups, early-stage technology companies, which are trying to create businesses out of them. There are so many different technologies out there today who have been either funded by DOE or have got an early-stage idea or technology which is [inaudible 00:33:53] proven, but needs the help of a business major to come in and really make it a business. DOE does a very good job of bringing out a lot of these technologies. So you can go to some of the DOE showcases. There are industry bodies now getting created, like DAC Coalition, where you can go and check out some of these early-stage companies which are trying to play a role in direct air capture. And each of these companies need business folks to come in to help.
Lastly, and most commonly, HBS folks are big in finance: private equity, venture capital and debt. All of these things are required in significant amount. I mean, $150 billion per annum is what people are estimating going towards climate tech in US, starting now. So a lot of the capital provisions which you guys are wanting to do and be in the capital markets, you can play in the capital markets as well towards climate.
Mike Toffel:So it sounds like lots of opportunities for folks with technical backgrounds, as well as strategists, marketing, financiers and the financing side. So lots of different disciplines needed to help make these promising startups more of a reality.
Shantanu Agarwal:Absolutely.
Mike Toffel:Well, Shantanu, thank you so much for joining us here on Climate Rising and returning to HBS from your class of 10 roots. It's been a really terrific, wide-ranging conversation. Really appreciate you spending time with us.
Shantanu Agarwal:Thank you, [inaudible 00:35:20] Toffel. This was wonderful. I really enjoyed it.
Mike Toffel:That was my conversation with Shantanu Agarwal, co-founder and director of Sustaera. Thanks for listening. If you like what you hear, please subscribe wherever you get your podcasts, share with your friends, and don't forget to rate and review. For show notes, head over to climaterising.org or click on the link in the podcast information.
You've been listening to Climate Rising. I'm your host, Mike Toffel. Kate Zerrenner is our producer and Craig McDonald is our audio engineer. We'll be back in two weeks with another episode of Climate Rising. See you then.
PART 4 OF 4 ENDS [00:35:58]
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