This month's Gist is about concrete and its chief component - cement - one of the truly hard matters of decarbonization, and an emerging focus of new tech and policy innovation.
Did you know that 40% of concrete is procured by the public sector in the U.S.? I smell opportunity…
Staffing update! This month we welcomed Max Tuttman, formerly a Tech-Market Advisor at ARPA-E, as a Principal, and Sean Harrington, former Optimus Ride CEO, as a Senior Advisor.
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Finally, a big thanks to Xander Mitchell for his help with this month’s edition!
Cement is Really Hard
Humans' favorite thing to consume is water. Our second favorite thing to consume is cement. It’s the integral component of concrete, a material ubiquitous in buildings and sidewalks the world over.
Cement is the truly hard matter of the decarbonization game. It was one of the reasons I argued for the necessity of Carbon Dioxide Removal (CDR) in February, because decarbonizing the supply chains of heavy industry like concrete and steel will take time.
But it needs to start now: for every ton of cement produced, a little under the same amount of carbon dioxide goes into the atmosphere. Cement accounts for ~7% of total global emissions. The US is the third largest producer of cement but has the most carbon-intense cement production in the world, due to high clinker-to-cement ratios in US cement plants. Clinker (it sounds bad, right?) is a binding substance in cement that is produced in the cement kilning stage, and amounts to more than half of cement's emissions.
In short, it takes a lot of thermal energy to manufacture cement, and it will be difficult to decarbonize.
The first lever of this heavy lift will be the government, because 40% of all concrete in the United States is procured by the public sector, and more than half of that is procured by state and local governments.
That puts the government in a market-making position.
But before we go deeper on what those policies would look like, let’s talk about the emerging tech.
There are two main ways to reduce concrete’s net carbon pollution: (1) develop a new low or zero carbon process for producing cement, which is the major CO2 emitting component of concrete. (2) use it as a vehicle to absorb and store CO2 that would otherwise be emitted.
Green Cement: Startups like Sublime Systems, Chement, and Brimstone Energy are developing ways to reduce or eliminate emissions from cement production. Sublime and Chement substitute fossil-fired kilns with electrochemical processes, eliminating direct heat emissions and making cement’s inherent chemical CO2 emissions much easier to clean up. Brimstone eliminates process CO2 emissions by swapping out (clinker-adjacent) limestone for calcium silicate, which does not release CO2.
Concrete as Carbon Storage: CarbonCure and CarbonBuilt inject CO2 into fresh concrete for storage, reducing the final product’s net carbon intensity. By adding into the standard cement mixing process, this kind of tech avoids needing to revamp the concrete supply chain.
However, not all approaches are going to work. NREL authored a recent paper that found some tech in this category can lead to net emissions, because they can require more cement to make their concrete as durable as the standard stuff.
Now, back to policy that will help scale green concrete:
At the Federal level, a recent Executive Order included a national Buy Clean initiative that would begin to move the government to procure lower-carbon materials, including concrete. The General Services Administration, which oversees $75 billion in annual contracts, will now require federal contractors to use climate-friendly concrete and asphalt in the agency’s major projects.
States are taking action too. Each one produces concrete and there is a growing movement for state-level Buy Clean policies, which have passed in Washington (2021), Minnesota (2021), Colorado (2021), New York (2021), California (2021), and Oregon (2022).
Buy Clean is an important start, but most of these policies are laying the foundation for actual procurement later. They focus on setting standards for Environmental Product Declarations, so that government agencies can develop procurement standards, and industry can report embodied carbon in a uniform, verifiable way.
New York could move ahead of the pack with the proposed Climate Forward Concrete Leadership Act, which would add performance incentives for industry when they exceed minimum carbon thresholds and a process for expedited approvals - less than 6 months - for new low carbon concrete materials.
We need bolder action.
For a green cement startup to truly break into market, it needs the financing to build and operate capital-intensive cement plants. But the status quo cement industry is dominated by a handful of giant multinationals that will use their pricing power, supplier relations, and political connections to keep new entrants out– unless policy provides enough stick and carrots to truly transform the market.
What we need is something like a Low Carbon Concrete Standard that puts increasing limits on the allowable carbon content of concrete. We need governments to enter into Green Concrete Purchase Agreements (GCPA) with producers to buy clean at a particular volume and price. A GCPA would enable new cement manufacturers to secure the financing they need, to build new facilities and compete with incumbent producers. And we need regulators to focus more on performance outcomes (see NRDC’s new policy handbook for low carbon concrete procurement) rather than prescribing exactly what kinds of materials are permitted.
Green concrete is not as sexy as a Model 3, but it is the hard stuff that needs to get done. After all, if Elon thinks single lane underground tunnels (Google: Hyperloop) are a realistic solution to traffic, he'll need some good cement. Tweet that!
News from Our Network
From our clients:
Octopus Energy is covering £50million in customer energy bills over the next six months as England reels from skyrocketing energy costs. They also acquired Northern Irish heat pump manufacturer Renewable Energy Devices.
Dandelion co-founder and President Kathy Hannun was among the female executives offering their advice at Techopedia. And we heartily second Dandelion's celebration of the new tax credit for geothermal heat pumps in New York.
Therma° CEO Manik Suri was on the More Than Work Podcast to discuss the company's IoT-powered approach to energy and food waste.
Aeroseal’s technologies are featured in episode seven of the documentary Solving for Zero, a series based on the Bill Gates book How to Avoid a Climate Disaster.
BlocPower will electrify seventy-two low/moderate income homes in the Bay Area with East Bay Community Energy, under the ever-innovative leadership of Nick Chaset.
From friends and colleagues:
Stripe, Alphabet, Shopify, Meta, and McKinsey headlined a $925 million advance market commitment to accelerate carbon removal standardization, certification, valuation, and tech neutrality. Climate Tech VC interviewed Stripe Head of Climate Nan Ransohoff about "permanent 1,000 years or more sequestration that takes advantage of carbon sinks not constrained by arable land." Our February Gist looked at the policy challenges of carbon removal, starting with the need for tech-neutral federal policy.
Washington State put in place the most progressive building code in the country for commercial and large multifamily buildings– hats off to Anna Lising, former Opower teammate, for her achievements as Senior Climate Advisor to Governor Inslee.
Congruent Ventures' Climate Impact Report depicts a color coded array of interesting investments.
National Grid announced plans to use heat pumps and renewable natural gas to eliminate fossil fuels from heating systems in New York and Massachusetts by 2050.
Earthjustice Senior VP Sam Sankar sent a thoughtful response to last month's Gist, "Ukraine and the War on Methane." An excerpt:
- "Industry will always say they are in favor of regulation but will then turn around and immediately fight to question everything from the basic idea of government regulation (by among other things successfully capturing the Supreme Court and turning it into a deregulatory policy-making body) to the machinery of regulation (by among other things successfully cutting EPA’s funding over decades). So when you say 'we can deal with methane through careful regulation' what I need you to recognize is that the industry is happy to agree with you in principle but only because they want you to say that first part. They plan to totally screw you on the second."
Jobs in our network:
Send us your job openings in cleantech policy, startups, and utilities, and we'll put it in next month's Gist.
Dandelion Energy is hiring a Policy Manager to help blow open the market for residential geothermal, and you get to work with the wonderful Heather Deese.
BlocPower is looking for a Director of Utility Sales to accelerate electrification for low and moderate income communities.
Brimstone is hiring for a Director of Public and Private Sector Policy to advance policies that will accelerate the decarbonization of cement.
Our friend Aaron Berndt at Google Nest is hiring a new sales lead for their energy marketplace team.
Wellington Management is hiring a Venture Associate for Climate Innovation, and you get to work with Mike Delucia.
The Rhodium Group is hiring a Director to lead their Corporate Climate Advisory Work, and you get to work with Kate Larsen.