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Circular Carbon Innovation: An Unrealized Investment Opportunity

Circular carbon technologies present diverse and significant opportunities for investors, according to a comprehensive analysis by the Circular Carbon Network (CCN) – a new initiative of the NRG COSIA Carbon XPRIZE. The report summarizes industry perspectives on carbon conversion and ways to unlock capital investment in this nascent, yet potentially massive market. In articulating investor needs and opportunities, CCN aims to spark capital investment for innovations that generate economic value by reducing, using and converting CO2 emissions, including breakthroughs that convert CO2 into valuable products developed by teams competing in the NRG COSIA Carbon XPRIZE.

“Meeting the goals of the Paris Climate Agreement presents a fantastic opportunity for private investors to join with state and local governments to help de-carbonize our economies. With CCN we are trying to pinpoint and support the role that private capital can play in driving technology innovation in the carbon space,” said Marcius Extavour, senior director of energy and resources at XPRIZE and lead for the NRG COSIA Carbon XPRIZE. “Our early work with CCN helps to frame the investment opportunity and momentum in circular carbon technologies that can both reduce CO2 emissions and make money.”

The report, published on September 19, 2017, “Circular Carbon Innovation: An Unrealized Investment Opportunity,” highlights findings from market surveys, the 2016 Carbon XPRIZE Team Summit and the Clean Innovation Investor Summit, at which more than 200 capital providers, corporate leaders, entrepreneurs and other stakeholders identified key mechanisms for increasing the flow of capital in the space, and ultimately driving new innovation and commercialization at scale. The report provides a comprehensive insider analysis of gaps in the capital space and potential solutions to fill those gaps. CCN’s goal is to unlock the capital to jumpstart a new market of circular carbon innovations, which include carbon conversion, carbon capture and storage, carbon utilization, and direct air capture technologies.

Key takeaways in the analysis include:

  • CO2 products present diverse and significant opportunities for investors and a potential market size of between $800 billion and $1.2 trillion annually by 2030, as estimated by the Global CO2 Initiative.
  • Capital providers and large corporates are increasing engagement and investment at all stages of the technology development cycle.
  • Persistent gaps and barriers in the capital ecosystem have slowed capital flows into circular carbon technologies, including: questions around policy and regulatory risk, capital intensity, unavailability of data and standard financing models.
  • Investors and industry stakeholders believe that these gaps and barriers can be addressed through new financing tools, market services, and technology development support, which are detailed in the full report.

“While we still see a number of challenges for the circular carbon market, we’ve also seen a tremendous amount of innovation and progress in the space,” said Nicholas Eisenberger, founder and managing partner of venture catalyst firm Pure Energy Partners, which invests, advises, and consults in the clean economy space. “It’s very timely to use the tools of business and investment to try to address some of the major environmental challenges the world faces.”

Click here to download the report.