Take lemons and make lemonade

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Cement and concrete production has been, and continues to be, a major contributor to anthropogenic climate change. This is important because, globally, the industry that produces cement and concrete generates between 7 and 8% of annual carbon dioxide emissions.

Until now, the production of cement and concrete has been real lemons for the Earth’s climate. However, there is a decent chance of being able to take those lemons and make lemonade out of them. The lemonade in question involves the extent to which it might be possible to capture carbon dioxide from power plants that burn fossil fuels and sequester the captured carbon dioxide in concrete, in a way that is both permanent and economical.

One indication of whether this might be possible, on a large enough scale to make a difference to climate change, involves the result of a pilot plant located in Pittsburg, California, just north of San Francisco.

In this article, I want to share with readers what I recently learned about “making lemonade from lemons” while teaching climate finance to students at Santa Clara University, just south of San Francisco. The Pittsburg plant is owned and operated by Blue Planet Systems. Blue Planet CEO Brent Constantz recently addressed one of my finance classes, and I’ll summarize some of the key points he made in his presentation below.

Human activities emit approximately 40 gigatonnes (Gt), or 40 billion metric tons, of carbon dioxide per year into the Earth’s atmosphere. A metric ton (tonne) is 10% larger than a standard ton (2,000 pounds). By way of comparison, about 30 Gt of concrete are poured each year.

Concrete is a mixture of cement, sand, gravel and water, the cement being the agent that binds the sand and gravel together. The combination of sand and gravel is called “aggregate” and is approximately 80% concrete. These 80% represent 24 Gt by weight; and because 44% of aggregate is carbon dioxide, producing concrete requires about 10.5 Gt of carbon dioxide, a very large number.

Globally, asphalt has about the same carbon dioxide content as concrete, and so the two together contain just over 20 Gt of carbon dioxide. Instead of being emitted into the atmosphere, it is plausible that these 20 Gt of carbon dioxide are sequestered on the Earth’s surface. Remember: 20 Gt is about half of today’s annual CO emissions2.

The idea of ​​Blue Planet System is to capture carbon dioxide emissions from power plants and other sources, and use the CO2 to make the aggregate that goes into making concrete. If successful, the company says the end result is a double win: first, carbon dioxide from power generation is diverted from being emitted into the atmosphere and instead is sequestered; and second, synthetic aggregates result in reduced emissions that would have been associated with the production of cement and concrete by conventional means.

As for cement, Brent Constantz pioneered a way of making cement that mimics the way corals build reefs. Both cement and coral reefs are limestone, and so the question is how to make limestone in a way that does not produce significant carbon dioxide emissions. So far, corals do this successfully, but humans don’t. Limestone is calcium carbonate, which can be produced as a chemical combination of carbon dioxide, oxygen and calcium.

Constantz likes to point out that over 99.9% of all carbon on Earth resides in the limestone that makes up coral reefs, with the remaining 0.1% residing in the atmosphere, the non-reef component of the oceans, and the biosphere.

Think what will happen if Blue Planet’s pilot plant in Pittsburgh is successful.

The achievement involves successfully capturing carbon dioxide from a natural gas-fired power plant that provides electricity to San Francisco.

Success involves being located in a deep-water port, where large amounts of raw materials can be fed into the Blue Planet factory and processed to extract calcium.

The success is to transport the carbon dioxide from the power station to the pilot plant of Blue Planet, so that the carbon dioxide can be mixed with water and calcium to produce aggregates/calcium carbonate.

Success involves using the deep water port facility to ship finished aggregates to end user customers.

Success involves doing all of this in a cost-effective way, like a regular business where the activity of carbon capture and sequestration pays for itself.

Success involves doing all of these things while being carbon negative, which means that when accounting for the emissions associated with all the energy required to run its business, Blue Planet removes significantly more carbon dioxide from the atmosphere. than it adds.

The Pittsburgh power plant produces 2 million tons of carbon dioxide per year. Compared to the potential and the need to address the scale of climate change, this is a small amount. In this regard, Constantz argues that Blue Planet’s technology is scalable in a short period of time, i.e. five years, from the start of the authorization until the establishment of a factory in fully operational operation.

Being a behavioral economist, I recognize that there are many behavioral issues to focus on. One thinks in particular of the fallacy of planning, that is to say the combination of excess and excess of confidence, on the part of business leaders. There are simply many ways projects fail – especially large, complex projects like Pittsburgh – that are hard to imagine at the time of creation; and a lot of things have to go right for a project like this to succeed.

With any new technology, there are a lot of risks; and Blue Planet’s technology is no different. With that in mind, I would say there are also reasons to be cautiously optimistic. Planes, cars and trucks now run on cement and concrete produced by Constantz companies, concrete found on California’s main coastal highway and also at San Francisco International Airport.

Besides whether the technology works, which it does, there is a second reason to be cautiously optimistic. Blue Planet Systems manufactures an economic value product, which promises to generate a reasonable return for investors.

Significantly, the business model is not dependent on receiving tax-funded government grants. Instead, the primary role of government is procurement: the purchase of “clean” concrete for infrastructure projects. In this regard, think globally. Think of the regions of the planet where infrastructure has been decimated by war and where infrastructure needs to be rebuilt. Tragically, these days, such regions come easily to mind.

Blue Planet Systems is a company to watch. Climate change is a controversial subject, and readers will react in different ways to companies like this. Some readers might think that the whole idea behind Blue Planet is a pie in the sky, and that human life on the planet is already doomed. Others might be unhappy that companies like Blue Planet are profiting from climate change. Still others worry about moral hazard, that if companies like Blue Planet succeed, emitters will feel more comfortable increasing greenhouse gas emissions into the atmosphere.

My advice to readers is to find a way to be both open-minded and skeptical, and as far as possible avoid letting ideology influence opinions. The end goal is to restore Earth’s climate to health as much as possible, and if Blue Planet’s technology can move the needle in that direction, that’s a good thing.

With regard to moral hazard, let me clarify that we need sensible public policy in place that sets the price of carbon at its social cost. So far, global policymakers have failed miserably when it comes to setting a reasonable price for carbon; but it’s hard to see how opposing sensible carbon capture and sequestration due to public policy failures makes things better.

Investors take note. When it comes to climate change, the stakes are high; and so are the potential benefits associated with Blue Planet’s technology. There are global companies watching with great interest what is happening in Pittsburgh. If the pilot plant is successful, there are good reasons to expect them to form partnerships with Blue Planet, which will enable rapid scale-up.

The IPCC continually reminds us that what is done on the climate front in the current decade is crucial. Constantz is impatient. He has a plan in place to significantly expand his business before 2030. In this regard, his statements are quite bold. It is clear to say that in very plausible scenarios, Blue Planet’s technology will reduce carbon dioxide emissions 35 times more than Tesla’s electric vehicles.

Blue Planet Systems will be a story worth watching, as it unfolds.

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