Defossilizing Industry Scaling-up CCU 2025

enaDyne has leveraged feedstock and infrastructure opportunities to drive scale BOX 6 enaDyne is a leading CCU start-up which has developed a novel plasma catalysis technology to convert CO2 and methane to various short- chain hydrocarbons with a range of downstream applications. Strategic site selection has been a crucial scaling-up lever for enaDyne’s technology. Biogas plants in Germany were valuable initial targets for the business, due to a pre-existing combined CO2 and methane gas stream, as well as sustainable electricity from co-generation facilities. Additionally, in the context of reducing subsidies in Germany, there has been demand for valorization of outputs streams among biogas players, presenting a valuable demonstration and scaling-up opportunity for enaDyne. The business is now forming partnerships with incumbent industrial players to valorize off gases – also composed of CO2 and methane – and to abate harmful PFAS emissions. This creates immediate economic value for the incumbent partners and sets the stage for expansion within this production niche. With the technology proven in this context, the next step for the company is driving growth to deploy at the scales at which these legacy industrial players operate. Source: Wood Mackenzie, expert interview with enaDyne. Building credibility and relationships with industry incumbents Incumbent industrials generally operate legacy businesses with longstanding, proven engineering practices and production processes. As a result, they can be reluctant to take on risk associated with unfamiliar technologies. This can be exacerbated by communication challenges, as novel solutions may draw from emerging technology areas which legacy industrials have little exposure to. The result can be protracted timelines to conduct due diligence before a decision is made on whether to partner on a CCU trial. Such slow decision-making presents a significant obstacle to start-ups, which operate on timelines of months to days, given their commitments to venture capital investors. Leveraging opportunities to demonstrate credibility helps CCU technology developers to unlock working partnerships with incumbent industrial companies. Establishing a relationship early during the R&D stage can be particularly effective at accelerating the timeline towards deployment, as initial barriers arising from a lack of familiarity are overcome early. Furthermore, as incumbent development partners can often be future customers, their involvement provides practical insights on integration needs and market fit that can be incorporated early on. Taking advantage of industry-sponsored public and private research funding programmes can be a route to establishing these connections. Partnering with individual veterans from the target industry can also provide valuable mentorship and facilitate access to industry incumbents. The challenge here lies in identifying and recruiting relevant and motivated mentors, who can be hard to come by. Start-ups that have done so successfully have often leveraged professional networks, but there may be a role for third-party organizations to broker connections between innovators and prospective mentors. Start-ups have also employed multistakeholder networks of academic, industrial and commercial experts to help guide technology and business development – enabling demonstration and scaling-up opportunities. Slow decision- making presents a significant obstacle to start-ups, which operate on timelines of months to days, given their commitments to venture capital investors. The role of multi-stakeholder collaborations 4.2 There are significant uncertainties around how future value chains will evolve as CCU pathways scale up. By taking a collaborative rather than competitive approach, companies are working to validate and realize commercial market opportunities for CCU. Creating market opportunities Cross-industry networks are emerging which seek to build links between incumbent industrial sectors, technology developers and end users to identify project opportunities (see Box 7). In some cases, consumer brands are also driving demand from the end-user side.65 Although specific offtake arrangements to date have tended to be bilateral and limited, this is indicative of a growing interest in supply chain sustainability. Defossilizing Industry: Considerations for Scaling-up Carbon Capture and Utilization Pathways 30