Carbon To Stone benefits from public procurement demand signal BOX 2: The top innovator from the Forum’s UpLink programme, Carbon To Stone, has experience navigating political risk and has benefited from standards set by public sector procurement in supporting scale-up of CCU. Carbon To Stone is a leading start-up developing reactive CO2 capture and mineralization technology which generates carbonated material using alkaline waste materials combined with point source or atmospheric CO2 capture, for use as low-carbon or carbon neutral building materials. Being able to make a policy-independent, value- driven pitch to prospective customers can be a valuable tool for start-ups in navigating a shifting political environment. In this case, being able to position themselves as a company specializing in waste upcycling, rather than carbon capture, has been a useful strategy. Carbon To Stone’s story highlights the role public sector procurement can play in driving demand among prospective customers. For example, under their Buy Clean Concrete Guidelines, the government of the State of New York requires that purchases of construction materials meet defined sustainability criteria.59 This has led to increasing interest in low-carbon and carbon neutral building materials, with new customers among concrete suppliers driving new business for Carbon To Stone. Source: Wood Mackenzie, expert interview with Carbon To Stone. Standards and public sector procurement Product classification could be a valuable lever for driving market interest in CCU-derived alternatives to conventional products. Being able to credibly demonstrate emissions intensity improvements can be a market differentiator for products that are uncompetitive on price. Opportunities to tie such classifications to consumption or emissions- intensity mandates for end-use sectors will enhance this further. This could include minimum standards for emissions-derived and DAC/biogenic carbon within carbon-based products. Beyond direct mandates, the public sector has the capacity to drive standards through procurement and other forms of offtake agreements. The public sector is the leading buyer of many CCU-relevant products, in particular construction materials and fuels. By requiring that these materials come with certain environmental product declarations, incumbent industrial suppliers will be increasingly incentivized to invest in low-carbon options to remain competitive. Beyond direct mandates, the public sector has the capacity to drive standards through procurement and other forms of offtake agreements. Considerations for addressing policy barriers 2.3 To address and navigate the policy and regulatory barriers described above, the following enabling actions are recommended for key stakeholder groups. First movers – navigate policy and political risk While the wider policy and regulatory environment is largely beyond innovators’ sphere of influence, the following strategic approaches could help mitigate associated risks: –Aim to establish operations in regions with the right combination of credible incentives and political stability. –Where possible, target regions which can provide multiple policy levers to draw on, providing redundancy and improving financing appeal. –Aim to pursue geographical diversification as a means of mitigating policy risks where practical. –Engage with the public sector as a prospective offtaker to identify and comply with potential product requirements. –Ensure that pitches to investors highlight the commercial value of the product independent of alignment to policy ambitions. –Ensure that the technology will be financially viable when operating at scale, without subsidy. Defossilizing Industry: Considerations for Scaling-up Carbon Capture and Utilization Pathways 19

Defossilizing Industry Scaling-up CCU 2025