As the world scrambles to reduce carbon emissions, new technologies that will be essential in the fight against climate change are being backed by academics, investors and policymakers around the world.
Original ideas ranging from machines to suck carbon emissions from the air to hydrogen gas-powered trucks have become realistic prospects, driven by a growing urgency to find ways to wean economies off fossil fuels and stem global warming.
“Innovation is the only way for the world to reduce net greenhouse gas emissions from about 51 billion tons per year to zero by 2050,” wrote Bill Gates – co-founder of the technology group. Microsoft and most recently founder of climate investment group Breakthrough Energy – in the FT last October.
Under the Paris Agreement, countries have agreed to limit warming to 2°C – and preferably 1.5°C – above pre-industrial levels, but this requires a huge reorganization of economies away from their dependence on fossil fuels.
The fastest way to decarbonize in the short term is to develop renewable energies to replace coal and gas. This will be all the more important as transport and domestic heating are electrified.
“The biggest piece of the puzzle is to deploy technologies that already exist on a large scale”, explains Faustine Delasalle, director of the Energy Transitions Commission. “The basis of the energy transition is massive investment in wind and solar power.”
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While electrification and the deployment of renewable energy can go a long way, for some sectors it will not be enough. Cement and steel manufacturing, for example, cannot simply be electrified and powered by renewable energy. Likewise, heavy transport – such as air transport, maritime transport and long-distance trucking – presents a challenge.
But there’s no time to wait if we’re going to decarbonize in time, says Kurt Waltzer, chief executive of the Clean Air Task Force, a US-based environmental think tank.
“If we don’t diversify our efforts, we won’t be able to reach our hard-to-reduce areas,” he says. “If you don’t take multiple paths, you put decarbonization at risk.”
According to the International Energy Agency, by 2050 almost half of global emission reductions will come from technologies “currently in the demonstration or prototype phase”.
These include approaches such as carbon capture and storage, where emissions can be prevented from reaching the atmosphere and instead buried deep underground. An advanced type of carbon capture system – known as direct air capture – extracts CO2 from the atmosphere later, after it has been emitted.
Another technology that has caught the eye in recent years is hydrogen, which can be used as a fuel and emits no CO2 when burned. If it is produced from renewable energies, it is called “green hydrogen”. Proponents say it could become a huge market, worth up to $2.5 billion worldwide.
But the problem is that carbon capture and green hydrogen technologies are expensive. Investments and scale are needed to reduce costs so that they become economically viable prospects.
Fortunately, funds are pouring into the climate tech sector as investors rush to support the next big thing, and the costs are expected to come down over the next few decades.
Investments in climate technologies more than tripled to $60 billion in the first half of 2021, compared to the same period in 2020, according to a recent PwC report. Today, 14 cents of every dollar of venture capital investment is now allocated to the sector.
“Around a trillion dollars is currently invested in new technologies in terms of venture capital,” John Kerry, the top US climate diplomat, said at the CERAWeek oil conference in Houston this month. “There’s a lot of money now chasing that new future.”
Investors seek to advance innovation at an early stage as well as fund brand new technologies.
An example is nuclear fusion: the act of forcing two atoms together, rather than pulling them apart, according to the fission process used in modern power plants. Achieving fusion – the reaction that powers the sun – has baffled scientists for decades, but money is now being pumped into the technology. Investors are hoping this could unlock a clean, unlimited supply of electricity.
Experts say the best hope for tackling global temperature rise is to pursue an “all of the above” approach: massive deployment of existing technology, scaling up and commercialization of alternatives to a early stage – and the pursuit of breakthrough technologies that do not yet exist.
“We have many of the technologies that we need right now. . . to get us through the next 10 years,” Kerry said. “Then over the next 10 years things are going to happen that might even change the whole game.”