I don’t cover CO2 capture quite as much anymore. This is partly because companies aren’t pushing as many emission-related press releases as they were a few years ago, and partly because I’m marginally less naive and don’t want to broadcast what I deem as merely PR. Sadly, the fact of the matter is that capturing CO2 is a cost nobody wants to incur, and converting CO2 into something useful is very expensive, so investment in the space generally tracks with government interest. That being said, something in the news did pique my interest: there’s a start up called Verdox that is capturing CO2 in a sort of electrochemical swing system, where two electrolyzers operate in parallel, alternating which one captures CO2 on its electrodes and which releases it. My interest here is borne out of first principles: the operational cost of capturing CO2 is roughly equal to the cost of energy, and, in isolation, electrochemical systems have lower theoretical energy requirements than thermochemical systems. Now, that doesn’t mean that electrochemistry is the right way to scale CO2 capture, nor does it mean that there will only one solution—it just seems like the right technology to be developing. Anyways, Verdox recently demonstrated that their technology works at an aluminum smelting plant. [LINK]

When I began writing this newsletter 5 years ago, Origin Materials had yet to go public via SPAC, and they were focused on the valorization of lignocellulose to furans (where furans would serve as platform molecules for markets that Origin could develop). Post-SPAC, Origin had the cash to build a demonstration-scale site, which started up and saw some success, but the macro environment changed and the cost of capital soared, which made an investment into a full-scale site look more like a death wish. Fortunately Origin was already iterating product development downstream from furan production, and PET bottle caps suddenly became the company’s best route to cash flow break even. This seems to be going fairly well for them—they just secured some debt and equipment-backed financing and expect to be run rate EBITDA break even sometime in 2027. This is a big deal! It’s not like raising money from VCs or SPACs is easy, but those sources of capital don’t require the same cold hard facts that banks do.

Last month we talked about how MP Materials was one of a few US-based companies seeing direct investment from the US government. Since then, apparently the share price for various stocks in the rare earth metals supply chain have seen huge swings as retail investors speculate that yet another Department of Defense (DoD) partnership announcement is on the horizon. The CEO of MP Materials recently spoke up on the issue, urging investors to keep structural economics in mind. In short: the market price for rare earths is simply not high enough for US-based miners to become profitable, and a key reason why MP Materials has a fighting chance is simply because they are vertically integrated. He’s basically saying that not all future DoD partnerships have nearly as much potential as the one he’s in charge of. [LINK]