Episode 218: Marcius Extavour, XPRIZE

Jul 18

Today's guest is Marcius Extavour, Chief Scientist, Executive Vice President Energy and Climate at XPRIZE.

XPRIZE is a global future positive movement of over a million people and rising. They are a trusted, proven platform for impact that leverages the power of competition to catalyze innovation and accelerate a more hopeful future by incentivizing radical breakthroughs for the benefit of humanity. The organization began supporting climate projects with a $20 million prize for breakthrough technologies to convert CO2 emissions into usable products. Now, they’re hosting their largest prize initiative in history funded by Elon Musk and the Musk Foundation, and awarding $100 million for Carbon Removal solutions.

This episode covers XPRIZE’s mission, how they decide on and evaluate competitions, key takeaways from their climate prize experiences, and how they measure success. We also dig into some of the nuances of the carbon removal conversation, how Marcius deals with naysayers, and why he focuses on solving the climate crisis instead of punishing polluters.

Enjoy the show!

You can find me on Twitter @jjacobs22 (me), @mcjpod (podcast) or @mcjcollective (company). You can reach us via email at info@mcjcollective.com, where we encourage you to share your feedback on episodes and suggestions for future topics or guests.

Episode recorded July 1, 2022.

In today's episode, we cover:

An overview of XPRIZE and how the organization came to be
XPRIZE's model expansion
Where XPRIZE's money comes from
External partnerships that help XPRIZE support an innovative ecosystem
Marcius' climate journey and background
An overview of the AAAS Science & Technology Fellowship Program
Characteristics XPRIZE uses to determine where prizes can be helpful
Differences between short and long-term impact
How XPRIZE started to explore climate topics
The NRG COSIA Carbon XPRIZE and key takeaways from the competition
The moral hazard argument
XPRIZE Carbon Removal, the largest incentive prize in history with Elon Musk and the Musk Foundation
How Marcius responds to critics
XPRIZE's plans to improve CDR measurements
Differences between measurement processes and tooling across solutions
3 evaluation factors, including operational performance, cost, and scalability
Marcius' predictions for how CDR can develop
The role of voluntary and compliance markets
Marcius' stance on whether we should punish polluters or focus on solving the climate problem
How people can get involved with XPRIZE
The community's role in moving things forward, growing globally, and maintaining inclusivity

Jason Jacobs (00:00:00):
Hey, everyone. Jason, here. I am the My Climate Journey show host. Before we get going, I wanted to take a minute and tell you about the My Climate Journey, or MCJ as we call it, membership option. Membership came to be because there were a bunch of people that were listening to the show that weren't just looking for education, but they were longing for a peer group as well. So we set up a Slack community for those people that's now mushroomed into more than 1,300 members. There is an application to become a member. It's not an exclusive thing. There's four criteria we screen for, determination to tackle the problem of climate change, ambition to work on the most impactful solution areas, optimism that we can make a dent and we're not wasting our time for trying, and a collaborative spirit. Beyond that, the more diversity, the better. There's a bunch of great things that have come out of that community, a number of founding teams that have met in there, a number of nonprofits that have been established, a bunch of hiring. That's been done a bunch of companies that have raised capital in there. A bunch of funds that have gotten limited partners or investors for their funds in there, as well as a bunch of events and programming by members and for members, and some open source projects that are getting actively worked on that hatched in there as well. At any rate, if you want to learn more, you can go to myclimatejourney.co, the website, and click the become a member tab at the top. Enjoy the show.
Jason Jacobs (00:01:34):
Hello everyone. This is Jason Jacobs. And welcome to My Climate Journey. This show follows my journey to interview a wide range of guests to better understand and make sense of the formidable problem of climate change, and try to figure out how people like you and I can help.
Jason Jacobs (00:01:56):
Today's guest is Marcius Extavour, Chief Scientist and Executive Vice President Climate & Energy at XPRIZE. XPRIZE is a global future positive movement of over a million people and rising. They are a trusted, proven platform for impact that leverages the power of competition to catalyze innovation and accelerate a more hopeful future by incentivizing radical breakthroughs for the benefit of humanity. Now, I was excited for this one because XPRIZE, of course, is very well known, and they've been doing more and more in climate. It started with a 20 million competition around developing breakthrough technologies that convert the most carbon dioxide emissions from natural gas and power plant facilities into products with the highest net value. More recently, they announced 100 million prize focused on carbon removal alongside Elon Musk and the Musk Foundation. We cover a lot in this episode, including Marcius's journey, what motivates him to do the work that he does, the origin story of XPRIZE, how those worlds converged, and what led Marcius to land at XPRIZE and do the work that he's doing. And also, his and XPRIZE's theory of change in terms of these prizes, how they help, how they measure success, what their track record has been so far, and what their vision is for the future. I learned a lot in this one, and I think you will too.
Jason Jacobs (00:03:29):
Marcius, welcome to the show.
Marcius Extavour (00:03:31):
Hey, thank you. Great to be here.
Jason Jacobs (00:03:33):
Great to have you. You're one of those climate people that I've known about from a distance for quite a while, and have always been meaning to get a connection to and get to know, but until, actually, five minutes ago, we've never spoken before. So great to meet you.
Marcius Extavour (00:03:49):
Likewise. Well, here we are. Look, I'm a fan of the show and what you guys are up to. So look, I like to meet new people, and I love what you guys are up to, so pleasure to be here.
Jason Jacobs (00:03:57):
Well, thanks for making the time. Maybe for starters, I know that your role is in a subset of XPRIZE, but just maybe talk about the organization overall and how it came to be.
Marcius Extavour (00:04:08):
Sure, sure, sure. So I'll start at the top. So XPRIZE, we're formally known as XPRIZE Foundation, we're a nonprofit foundation registered in the United States, and we've been around about 26 or seven years. I should know that number, but it's around there.
Jason Jacobs (00:04:23):
Well with the pandemic who even knows what year it is, so it's fine.
Marcius Extavour (00:04:25):
This is the thing. I feel like it's been a time war, so I'm having trouble keeping track. But the foundation's mission has been interestingly the same from the beginning. The mission is, do something good and positive that can benefit as many people as possible, and use the power of crowdsourcing, and innovation, and inspiration, and technology breakthroughs to do that. The original conception of XPRIZE, it was actually inspired by traditional prizes in history. So we didn't invent the idea of a competition or a incentive prize as we call it. But Peter Diamandis founded XPRIZE. He adapted the idea, and said his focus was opening private space. So he got started, I think, in the mid '90s, 94, 95.
Marcius Extavour (00:05:13):
Private space was not a thing. It was illegal. Only governments could go to space, by law. That means Russian Space Federation, NASA, European Space Agency. And Peter's idea was... I think he's written a book about this and he tells his story, but I'll give the abridge version. He personally was interested to go to space because he's a space nut, had been working in and around space all his life, but also, he thought there's got to be another way. And he found a way to raise money and design a competition for suborbital space flight. The prize turned out to be a wild success. The thing that is the basis of Virgin Galactic, so the base technology of that was designed by Burt Rutan, and Burt Rutan designed SpaceShipOne to win the first X-Prize.
Marcius Extavour (00:05:57):
And essentially, since then... That was the first 10 years of the organization, roughly. Since then, the model has been expanded and repeated, but now, not just in space, we still do space, but we do learning, we do AI, we do longevity health, we do biodiversity, we've done ocean's work. And then, of course, we do a lot of climate and energy-related work. I came to XPRIZE as an energy and climate person. I knew XPRIZE as a space org. I was surprised to hear they were doing energy stuff, and I thought, "Interesting. Prizes and energy, prizes and climate, that probably won't work. Would it work? Wait a minute. Maybe. Let me find out for myself." So that's a little bit about our history and how we got to this point of trying to use prizes to attack problems all over the place.
Jason Jacobs (00:06:36):
Where's the money come from?
Marcius Extavour (00:06:38):
Yeah. Great question. So we're not one of those foundations that has a giant endowment that we live from. Sometimes I wish we were, but we're not. We raise money separately and privately for every prize we launch. So every prize has a sponsor attached to it. For instance, I'm working on one with funded by Musk Foundation. We tend to go to high net worth individuals, companies, family foundations. In some cases, we've had government support even for some of our prizes, but we are constantly hustling and raising money from sponsors that we think have a shared interest in whatever problem we're trying to develop and launch into a prize.
Jason Jacobs (00:07:15):
Got it. So the organization itself sounds like it's thin, and then the bulk of the capital comes on a per program basis.
Marcius Extavour (00:07:25):
That's exactly right. I mean, overall, if you think about, well, not think about, if I'll tell you how XPRIZE operates, we're very much a leverage type of organization. So we will typically have three or sometimes four people running one of our prizes. And this is, usually, a tens of millions of dollar multi-year project, too big for three or four people really to manage, so we do this with a lot of external partners. We leverage a lot of contractor support. We have a lot of advisory and that support. And that extends to the funding model of XPRIZE, like you said. We're a fairly thin team internally, but that's by design to leverage a lot of external partnerships in other organizations And I think this is partly an operational choice. I think it's partly, look, you're a young scrappy startup and you need to leverage. I mean we're 25 years old now, but that's how we've started. But in retrospect, I will say that relying on partnerships is a great way to actually build an ecosystem. And that's actually, our big goal is try to help build and support innovation ecosystems around the topics we work on. So I think, in retrospect, it turned out to be a pretty good model for us to do what we do.
Jason Jacobs (00:08:32):
And I have another question I was about to ask on the general XPRIZE topic, but I'm going to write that down in circle. This is what I do, so I don't lose it, and hit pause, and now focus on you for a minute. So maybe talk a bit about your journey and what it is that brought you to doing the work that you're doing now with XPRIZE?
Marcius Extavour (00:08:51):
Yeah, sure thing.
Jason Jacobs (00:08:52):
How'd you get here?
Marcius Extavour (00:08:52):
How did I get here? Well, one step at a time. This is so corny, but having met-
Jason Jacobs (00:08:57):
You did that fellowship program that I love.
Marcius Extavour (00:08:59):
I did.
Jason Jacobs (00:08:59):
I always forget the exact accurate. Is it IAAAS? Or did I get that right?
Marcius Extavour (00:09:04):
It has all the letters in.
Jason Jacobs (00:09:07):
I've never done it, but like the people I've met that have done are so impressive. And it just sounds like it's building connective tissue in a sorely needed way.
Marcius Extavour (00:09:16):
It totally is. People call it the DC science mafia. And that's exactly what it is. No disrespect to, or I don't know if disrespects the right word, but I'm not trying to talk about real mafia. So I was a PhD student doing my thing in the lab in physics, enjoying it, but also thinking, "I want to use my skills in a different way." I left, took a hard turn out of academia, and went into the power sector.So up until this point, I was like a typical engineering and then physical science person, but maybe atypical in that I decided that, "You know what? Maybe I don't want a research career, like the careers I see around me. And I'm not exactly sure what I want, but I just think I want something different." So I was floating a little bit. I went to work in the power industry. Was working in a utility. Learned a ton, but was also really struggling because the culture was so different from the more free and creative academic environment I was used to. So it was really like my first corporate job. And I was struggling, but doing what I could. I found out about the fellowship, and I'd been working in science policy at that time in Canada where I'm from. And I don't mind saying that I put all of my energy and effort into, I am going to try to win this fellowship. I read every word of the application 50 times, I called every person I knew, which was two people that had ever heard of somebody that had done one. I managed to talk to a couple people in DC. So I basically gave myself the best possible shot that I could.
Marcius Extavour (00:10:41):
The fellowship I'm talking about. It's called the AAAS Science & Technology Fellowship Program. It's for people that have a science background that want to work on science policy. And some genius, I don't even know whom, developed this program about 50 years ago. And the idea was, you know what? No one in Congress knows anything about science, and specifically they don't know any scientists, not like Albert Einstein or the president of university, but a normal person that does regular work every day. And vice versa, we've got all these scientists that bitch and complain about policy, and this and that at lunch break, but they actually don't know how the government works and they don't know anybody, not a single staffer, and they probably never called their number of Congress. So what if we could have a cultural and personal exchange program? This has worked out fabulously well. Plenty of people come from science, work in DC for a year or two in the Hill, in the federal agencies, wherever, and then they go back, plenty of people stay. And I think you can find alums of this program all over the federal agencies, back in academia, and in random places like myself. What these people all have in mind is they have a deep science or tech or engineering background of some type, actually, a lot of social science people do. I don't want to leave them out. They know about government or have worked in government or worked near government, and then they've stayed or gone on to do other things, but they have that understanding, and they have a shared experience.
Marcius Extavour (00:12:02):
I mean, I was around 30 when I did that, but it also felt a little bit like camp, go to DC, meet a bunch of other people. It really opened my eyes to, "Hey, there might be other avenues for you as a sciencey person to take it in interesting directions that maybe are more up your alley." So really, really great. I still look fondly on it. I was just in DC last week, and my best friends in DC are people that I met when I was doing that fellowship.
Jason Jacobs (00:12:24):
So what did you do when you got out?
Marcius Extavour (00:12:25):
So I got out. First, I cried because I was trying to... It was about a year and a half. I worked on Capitol Hill. I worked in the Senate Energy and Natural Resources Committee. I just loved that job. I loved the people that I met. I loved the pace of it. And I loved that I got to work on real issues. Yes, DC is a tough place, but I found it an amazing place of really engaged, and bright, and earnest people. I know this is not the DC of drain the swamp, and I'm sure there are some nasty political actors, but that wasn't my experience. Maybe it was the topic. I learned a ton. I tried to get a job to stay. I couldn't stay on the Hill cause I'm not a US citizen. So I had to leave. And I was trying to find another job in DC, and I really couldn't find anything to make it happen.
Marcius Extavour (00:13:06):
So I left, I went back to Toronto, and was doing some consulting. Back in science policy for a little bit, and then I ended up working full-time as a fundraiser for the University of Toronto, which is my Alma mater. I worked for the dean of engineering. She had a mandate to raise a couple hundred million dollars. I wanted to sharpen my fundraising chops. So it was a combination of traditional philanthropic fundraising, talking to family offices, high net worth individuals, asking them if they would like to support the university in one way or another, the engineering programs. But the other half of it was more research-oriented. It was helping faculty members who had specific research interests, and programs, and projects they wanted to launch. My job was to help them figure out where they could get government or private sector money to make these projects happen, and be an amplification of their efforts.
Marcius Extavour (00:13:58):
So I wasn't driving the research, but I was like, "All right, I know how to explain this to a private audience or a government audience. I memorized where all the government funding programs are or how different companies are operating. And let's figure out how we could get," sometimes this is called sponsored research. Sometimes it's just university exchange. So for instance, here's an example, people in the computer science department, we're really focused on a particular type of hardware, project, or research program they wanted to do. Rather than do that in a purely academic setting, for them, it was really interesting to partner with somebody like IBM. So my job be like, "Okay, do I know anybody at IBM? Can I arrange a meeting between these folks? Can I broker a conversation that will help this project flow and be connective tissue?" Like you said. So that was what I did right immediately after leaving DC.
Jason Jacobs (00:14:41):
Great. And then how did you get from there to doing the work you're doing today?
Marcius Extavour (00:14:45):
So I was working at University of Toronto, doing fundraising, doing what I just described, really keeping my hands busy in a few other pots, like you do when you're hustling and trying to figure your way out. I was becoming more and more active, or still active, in energy and climate. I made that my main theme when I wrapped up my PhD. So still active in the area, and especially around themes of innovation, because I thought that was future-looking. I thought it was a field that was fundamentally future-looking in terms of the opportunities. And also, I'm just a technology nerd. And so I like it. And I like thinking about what could be, and imagining, could there be a better way? So I was doing that, but also keeping an eye on a lot of things to do with funding, investing, technology, innovation around energy and climate, mostly getting frustrated in the energy field, but then getting excited about the climate field. I don't know, this was like close to a decade ago, I was doing that job. And just the idea of the innovation and climate action, I don't think had come together quite yet, or at least among the circles I was in. Those were separate things.
Marcius Extavour (00:15:47):
I took a personal leave, actually. So my daughter was about one. My wife was going back to work. I was ready to move on for my fundraising job. And so I just quit and had no job for a while, and was taking care of my baby daughter at the time for a while, really trying to figure myself out. And after a few months of that, I decided that, yeah, I still want to go heavy into innovation related to climate and energy with a bit more climate focus. And a former AAAS fellow, through the AAAS fellows' network, I got wind that XPRIZE was launching a new prize related to CO2 utilization, which is a topic I was familiar with, but not really. To be honest, I thought it was weird in fringe. I thought, "Wait a minute. This is one of those silly ideas that we get trapped in, right?"
Jason Jacobs (00:16:34):
And this, it was the 20 million one that was the predecessor to the 100 million one?
Marcius Extavour (00:16:39):
Exactly. So this was called the NRG COSIA Carbon XPRIZE. So that thing was just... They landed the funding for that in 2015. And so the way we do at XPRIZE is, once we get the money, secured, then we hire a team to run the project. So heard they were staffing up, got connected to the place, put my hat in, and got a job offer. And also, at that time, convinced my wife that, "Yeah, you know what? How about moving to LA? What do you think?" And she was open to it, and then we ended up moving down here, and I've been an XPRIZE since.
Jason Jacobs (00:17:08):
So now we'll go back to that question I had circled, and not because it's some revelatory question, just because it's where we were before we took the detour here. But when it comes to selecting prizes at XPRIZE, what comes first? The topic area or the capital?
Marcius Extavour (00:17:25):
Good question. The true answer is, traditionally, it's been a mix of both, capital with an idea that doesn't make sense. XPRIZE has been pretty disciplined at staying away from those. XPRIZE has definitely pursued ideas that probably weren't the top of our idea list, but were funded or fundable. And so we pursued them. And of course, we have plenty of great ideas that sometimes we struggle to fundraise for.
Marcius Extavour (00:17:51):
But the other thing I'll say is, we've sometimes described the period of XPRIZE, up until maybe about a year ago, as random walk in the sense that we weren't saying, "Listen, these are the next five ideas we want to do. It's only these five. We're only doing these, and we're just going to keep fundraising until we get them." We were more like, "Well, we have a wishlist," but someone calls us and says, "Hey, how about this?" We'll at least consider it. We're getting a little more disciplined. And what that means is being more intentional about selection of where we think prizes could make a difference before we even think about funding, and then move into our funding cycle so that we know that all the ideas on our wish list, so to speak, are great ideas that we've vetted, not just as good ideas, but we think a prize could actually help there, which is a key, key, key differentiation. There are plenty of great ideas that need a lot of action. That doesn't mean a prize competition is actually going to lead to action. You have to be, I think, selective with this prize tool. But yeah, it's a great question. Like any nonprofit that doesn't have rock solid, stable funding, there's always the temptation to go to follow the money. And I think, frankly, that's something XPRIZE has to be disciplined about, and a lot of other organizations too.
Jason Jacobs (00:19:02):
And before we get to the climate and energy works specifically, you mentioned that you look for areas where prizes can be helpful. I'd love to unpack that. What makes an area an area where a prize can be helpful?
Marcius Extavour (00:19:15):
Okay. Well, let me just rattle off a couple of characteristics that I think are really important here. Maybe the most important is the ability to have an impact. You can do all kinds of stuff and convince yourself you're making a difference, but the harder question is, "Wait a minute. Are we actually moving [inaudible 00:19:30] on anything? Is this actually a good use of the fund? Was this actually additive in the community?" We look for things that can be disruptive in a positive way. And I'd say the really hard part about that is looking for near-term indicators of long-term impact. So I've been working on a prize for... Well, I'm working on a prize for carbon removal, for instance, and we know carbon removal, it mitigates the long-term climate risk. So we have to ask ourselves, what can we do in the short term that will help accelerate or create or strengthen a community that can deliver those solutions over the long-term? They're not going to happen in six months. And that can have long-term impact? And that's actually difficult to do. So you have to be pretty modest, but also you got to keep your eye on the long-term, but, but think about the short-term.
Marcius Extavour (00:20:12):
Okay. But impact is a big one. The need. We don't want to just do prizes just because. Then it just becomes a vanity project. There's got to be an identifiable problem that's not being solved by the private sector, by the markets, by the public sector. And we have to put our finger on a reason for that. And if we can, we probably have a good shot at then designing a prize that at least might be able to help fill that gap. We want prizes that can be relatable to people. We don't want this to be a technology competition that only the world's 50 top experts can actually understand.
Marcius Extavour (00:20:43):
Ideally, our prizes, at some level, are digestible by the broader public. Partly, this is because, frankly, the PR is helpful to drive attention to the innovators doing the work, but also, the more people get talking about a problem, the more chances you have that it enters the public consciousness, the culture, political discussions, social discussions. And these are all the things that we think are necessary for change on any topic, certainly climate. So that was more communication. You got to be able to describe it. Could I describe it to my neighbor who doesn't really care about the topic, but might be interested in like, "Oh, there's a thing happening. Maybe I'll click something or maybe I'll read, or maybe I'll call one of the startups and see what they're up to"?
Marcius Extavour (00:21:21):
And then, this is an insider thing, but this is really important. You have to have a very specific goal and a measurable goal. Specific means we can't have prizes that are, clean up the oceans. That's just too broad. It's got to be something like remove ocean plastic pollution of a certain type. And so we've looked for specific problems that can have domino ripple effects if solved. And then, the corollary to that is it has to be measurable. You have to know if it's been achieved. You can't have a competition if you don't know who won, winning is not the most important part of these exercises, but it is a crucial part. So there's got to be a clear measure of success that is considered valid and relatively transparent to everyone. That means the competitors. It means the independent judges. It means the press who calls up and says, "What's going up with this prize? Explain it to me in three sentences." Those are some of the characteristics that we've learned through experience, sometimes the hard way, that we think make great X prize competitions.
Jason Jacobs (00:22:19):
And you mentioned that one of the characteristics was that it mitigates risk in the long-term. I mean, if you just take carbon removal as an example, I think if you put that statement out to the broader climate community, that carbon removal mitigates the risk in the long-term, it would be pretty controversial. So according to who, how do you make the determination of whether something does or does not?
Marcius Extavour (00:22:45):
Yeah, great question. I think what I was trying to say was, if we are working at the cutting edge of a space and trying to design a prize to encourage actors to work fruitfully at that boundary, just by nature of it being at the boundary of a space, its impact may not be felt for some time. So if you're working on early quantum computing, or drug discovery, or literacy tools, they're early and they're new. And this is just the nature of technology. It takes a while for them to be felt socially. That's what I was trying to get across.
Marcius Extavour (00:23:14):
But for carbon removal in particular, I guess it's according to me, but, really, it's according to my reading and our reading of the climate arithmetic. CO2 is a long-lived greenhouse gas. The changes in the climate cycle are also long-term. Even if we stopped, for instance, as a thought experiment, if we stopped all of our CO2 emissions today, I snap my fingers and they all go to zero, it actually will take some time for, let's say, the earth system to equilibrate or metabolize. The exact half life or the timeframe of that is a subject of debate. And that's really best answered by climate modelers and climate scientists. But it's not immediate. It's not an impulse, as we'd say in physics. There are other greenhouse gases that, famously, have much stronger radiative forcing, like water vapor or methane. So the way I think about that is a roundabout way of getting to the answer here, but sometimes there's a debate about, why is all the focus on CO2? Why don't we focus on things like methane? Which is by far a stronger contributor to global warming today. And sorry, what I mean is the radiative forcing, meaning the amount of infrared light that it can absorb or deflect is much stronger than CO2, or water vapor, which is the most abundant greenhouse gas by mass. Well, the answer is, well, we have to focus on all of them, but methane is more of like a short-term forcer. So I think the rationale for focusing on methane is because it will lead to immediate cooling effects and it's a pressing problem. But in the long run, CO2 is the thing that has been driving our change in climate over the decades and centuries, and is the thing that we want. It's that continued inertia of that heating and the climate system we want avoid over the long-term. So that's why I say carbon removal, not only will take some time to spin up, but is a long-term solution. Whereas, there are other more short-term solutions that we can take. And I think we need a mix of all these things.
Jason Jacobs (00:25:09):
And so the predecessor to the carbon removal prize that we talked about, and I forget the wording, but carbon value, was that the first foray into climate and energy as an organization?
Marcius Extavour (00:25:22):
I would say, at the time, I think we thought about it as an energy prize when it was conceived. It wasn't the first foray into climate, but it was the first foray into greenhouse gas management. So just a couple of projects we had done in past. We had done an ocean acidification sensor prize. That, I think, is directly related to climate. We had done something called the Progressive Automotive X-PRIZE, which was a super mileage car driving challenge. It was actually a race. That was before my time, but that was clearly an energy-related prize. And then there were a lot of ideas kicked around here and there, but those were two that had clearly established XPRIZE's energy and climate work. The carbon prize, or sorry, NRG Cosia carbon XPRIZE because it was sponsored by NRG and Cosia. That's how it got its name. That was focused on using CO2 to make an economically relevant material or product. And the original conception was-
Jason Jacobs (00:26:16):
I'm glad they didn't sponsor a sports stadium because that would be a mouthful if you have to say that every time you go to an event.
Marcius Extavour (00:26:22):
I don't know if you're joking.
Jason Jacobs (00:26:23):
I'm going to the NRG Cosia Center.
Marcius Extavour (00:26:25):
Well, don't joke because I think it's in Houston. Don't joke because I think it's in Houston. NRG is big everywhere, but NRG is big in Princeton and in Houston. Those are their two corporate poles. I'm pretty sure there's a stadium in Houston called NRG Stadium, or at least used to be. Possibly NFL stadium, which I don't follow too close. But anyway, that's funny. Cosia, I don't think it's sponsoring stadiums that way, and neither is XPRIZE. We don't have it like that. But yeah. Look, the brief history of CCUS, as some people call it, or utilization, there was a time when people thought, for better or for worse, "You know what? This is going to save the coal power fleet. All we got to do is invent these scrubbers. We're going to strap them onto coal power, and gas, and maybe manufacturing, and we're going to keep them going forever, except we're just going to spit... We're going to cut the emissions and we're going to spit out money." That was a early fantasy of how this could work. That's long since been debunked.
Marcius Extavour (00:27:22):
But I think the reason... Something I quickly realized, and we realized as a team when I started working on it was, "You know what? The use case for power stations is not that strong because the volume of CO2, and frankly, the amount of energy required is considered too large of a so-called parasitic load in the power plant. In other words, it may not make economic sense to actually do this. It's probably far more expedius to just turn off the coal power plant, which has larger ramifications, but it's probably easier to just turn off those heavy sources. However, I think the place for utilization is still very strong in those sources of emissions that we will find extremely difficult to turn off, or we decide aren't worth it socially to turn off. And I'm talking about all of our manufacturing, production of steel, cement, concrete, glass, textiles, fertilizers. These are things that we don't really have good ideas on how to electrify, or switch to renewable power, or things like that. They're just sometimes fundamentally hard to abate, as they're called, which sounds like a dodge, but I don't think is quite is."
Marcius Extavour (00:28:25):
But anyway, this is a long way of me saying the carbon XPRIZE was initially thought of as an energy-related prize. I certainly came to think of it more as a climate prize after working on it for a few years, because I think it's just a more appropriate framing, even though we didn't quite realize that at first. But yes, generally, and that really set us on a path now to explore other climate topics, including carbon removal, but actually, many others that we have in mind to look at. And we actually even have a whole different biodiversity and conservation group that arguably is focusing on climate-related topics too, even though they're doing it under the purview of, as I said, conservation and biodiversity.
Jason Jacobs (00:29:02):
Well, that's the weird thing about climate it's like, climate is nothing and everything.
Marcius Extavour (00:29:06):
Exactly, exactly.
Jason Jacobs (00:29:08):
It's like, the next digital fitness solution will apply for the XPRIZE because it avoids people from getting in their car to go to the gym.
Marcius Extavour (00:29:17):
Totally, totally. And I mean, that's not such a hypothetical example. When you run a prize, you're fundamentally doing a crowdsourcing exercise. You're saying, "Hey, we try to keep our prizes extremely open. Anyone can participate. We try to make the barrier entry low, and we try to be encouraging" but that means we get tons of inbound proposals or solution ideas, or data, even, from climate-related ideas that might be extremely strong. And we have to say, "We love your idea. Unfortunately, that textile solution is not carbon removal. Has nothing to do with carbon removal, or has nothing to do with CO2 utilization, or has nothing to do with ocean acidification, or whatever. And it's totally in the climate thing, but we are only focused on this narrow slice."
Jason Jacobs (00:30:00):
So for that initial program, how'd it go? What were the key learnings? What were the biggest surprises? It'd be great to just hear the postmortem. I know it's a few years outdated at this point, but to the extent you recall.
Marcius Extavour (00:30:14):
I definitely recall. I'll never forget it. Well, we wrapped it up in April 2021, which was the exact moment that we launched the carbon removal prize. I would never want to live through that again, just like trying to wind down one big program and launch another one was very hard, but learnings. Okay. A few things. One, I did not expect this, but the two solutions that won, so there were two winners, both focused on CO2 mineralization in concrete. Now, according to let's say, the energetics or the thermodynamics, arguably, if you were betting, you should've put your money on that technology because, to get sciencey for a second, converting CO2 into other materials is sometimes critiqued because it's a losing game, energy-wise. You have to add energy to make it happen. The reason CO2 is so stable, it's a low energy state of a carbon molecule, but there is a lower energy state and that is a carbonate, like calcium carbonate. And so You can think of that CO2 doesn't really want to become methane, doesn't really want to become plastic. You really have to crush it with energy and chemistry to make that happen.
Marcius Extavour (00:31:22):
On the other hand, you just have to nudge CO2 to turn it into a carbonate. In some cases, it actually can be exothermic, which means you get energy back. And this is relevant, not just because of energy and physics interest, but because energy is cost if you're trying to build a business. And so energy to fuels takes more operating cost than energy to concrete. So your prospects of building a profitable solution are strong. And as it turned out, mostly because they executed the best, but also, they had an advantage of the energetics and the cost. So two mineralization to concrete companies won. That's the first thing that surprised me, even though maybe I shouldn't have been surprised.
Marcius Extavour (00:32:01):
Second thing was that it was harder than I thought. I thought when I signed up, I was like, "Wow, this is really hard. You have to build a system. You have to ship it to either Alberta, Canada, or Wyoming USA. And you have to run it for months at a time." It doesn't make it work for a day. This isn't like my undergraduate robotics competition, or like we got it to work for a day. This is like, it has to be a real pilot. It's got to work in the real world. It was even harder than I thought it was. So maximum respect to the people that are doing this work. It's difficult. It's doable, but very difficult. Just like making any hardware technology work in the real world, just very hard.
Marcius Extavour (00:32:38):
Third thing, people had all kinds of ideas for turning CO2 into stuff that I never would've dreamed of. I mean, I wouldn't call myself an expert before I started working on it, but animal food, polymers, liquid fuels, textiles, these just had not entered my mind at all. And just related to that, making a consumer product out of a CO2-based material, that speaks to people in a way that no amount of technical jargon and babbling on, or pretty science lecturers ever will.
Marcius Extavour (00:33:09):
I'll just give a shout out. There's a company called Air Company. They're getting wet on this space. They are working on jet fuel on other fuels. They make vodka as a brand, and they made hand sanitizer in the pandemic. Handing somebody a bottle of hand sanitizer, being like, "That is made out of CO2," accomplishes more in terms of relatability and communication than 100 slides in an hour of presentation because it's tangible, it gets people talking. So that's something I just did not appreciate.
Marcius Extavour (00:33:34):
And I mean, I'd love to think back on the learnings, because the nice thing about having seen a couple of cycles of XPRIZE now is that you have a chance to build those learnings into the next thing and say, "Okay, everything from logistics of how we test, to the requirements of competitors, how we engage with them, contracting, technical details, we were always improving and learning." And because we're working on carbon removal now, or at least my group is, we had a chance to bake a lot of those learnings, and we definitely didn't do everything right the first time, so we learned a lot. And then we had a lot of successes and then we were able to carry those forward and say, "Okay, we can do it more efficiently, or cheaper, quicker, better for the teams, better for the outcomes, etc." So we've, it's gratifying to pay it forward. And now we're just seeing to see if it yields the result that we hope.
Jason Jacobs (00:34:19):
After getting that initial program under your belt, were you more or less optimistic about the viability of CO2 utilization as a climate solution?
Marcius Extavour (00:34:32):
I definitely started out skeptical because I had worked on CCS in Washington and other places.
Jason Jacobs (00:34:39):
With the scrubbers for the coal plants like we were talking before?
Marcius Extavour (00:34:42):
Exactly. Take a point source, capture the CO2, stuff it underground, that's it. And I just thought, "I understand this from technical perspective, but all I see is red. All I see is cost. And the whole problem with climate is we're fighting about who's going to pay or in some framing. So how is the solution going to rise above?" I struggled to see that. So then when I heard about utilization, at first, I was extremely interested. I was like, "Wow, this thing could make money. This thing could actually generate revenue and clean up emissions. This is like magic." And then I remember, when I finally did the arithmetic to figure out, wait a minute, of all the 40 billion tons of CO2 we make every year, you can't possibly use all that to make stuff. In fact, even if you use a huge fraction of that to make stuff, you'll flood the market with those, with the volume of materials, you'll crash the price, no one will buy it. It doesn't work. And so I thought, "Wait a minute. Is this all... This is just not pencil out at all?" And then I reached a happy medium where I realized it does pencil out. No, it can't eat all 40 billion tons, but maybe it can eat, conservatively, 10%, optimistically, 20%. And that matters because I very much think of climate as a several different types of solutions deployed in hundreds of ways around the world over time. That's how we tackle this problem. So that was a learning, but I went through that emotional roller coaster as I just got deeper into the topic. Now I think about it, the other thing that's changing in my thinking is I used to think about it in very technical terms. Maybe make sense, coming from engineering background, does it make sense technically? Does it not? Now I do not see the technical barriers or opportunities as the key drivers. I see them as social, political, and business-wise. The technology is there. We can improve it if we choose. We can deploy it if we choose, but it's more of a strategic choice about how and when we will deploy these technologies.
Jason Jacobs (00:36:33):
I mean, can we do them cost-effectively without compromising quality?
Marcius Extavour (00:36:37):
That's exactly what I mean. So I think the answer is yes. Undoubtedly, yes. I do not see climate solutions as purely a cost play. And many people see it that way. I don't. So one way to see it is climate is a big problem. It sucks. The only way to solve it is to pay. And the only thing left to discuss is how much to pay and how much we can turn the cost down. There's definitely that side of it. And I think most of those arguments are all true, but I think there's another side, which is the value side, which is the upside, which is, what is the social value of having less warming, having less floods, heat death, cataclysmic climate effects? That has social value. We're terrible at converting that into dollars and cents. And in some ways, it's inappropriate, but to make some comparison, the value and the opportunity is huge, not just in climate mitigation, but in social terms, economic terms, weaning ourselves off of fossil fuels, which has all kinds of other benefits aside from climate.
Marcius Extavour (00:37:38):
So I'm very optimistic about that side of things. That's what gets me excited and motivated. But, or, and, I guess, it's much more of a nuanced social, political, business picture in addition to a scientific and technical picture.
Jason Jacobs (00:37:53):
And you mentioned that when this first program wrapped up, that that day you rolled out the second one on carbon removal. Before we talk about the second program, how do you think about those two, the carbon utilization and the carbon removal? And how do you think about them and how do you think about them relative to each other?
Marcius Extavour (00:38:13):
Yeah. Great question. They're cousins, close cousins. They play different roles in the climate system. CO2 utilization is probably mostly about mitigating emissions. That means we've got an existing emission stream. We want to turn it down. And we can turn it down, not at the source, which is the ideal place, but at that exit pipe. We can prevent a lot of emissions from going into the air or oceans by converting them into something productive. And if that productive thing can be sold for revenue, then you help to, either make the whole thing profitable, or, at minimum, offset the cost of doing the cleanup of the rest of emissions, assuming you can't turn all the emissions into stuff. Carbon removal is very interesting. I don't think it's really mitigation. I don't think it's adaptation either. I think it's actually a third type of climate action. And I don't have a great word for it, but that's how I conceive of where CDR fits. And so that's one way in which I see them being different.
Jason Jacobs (00:39:09):
I mean, can't you say, you can lower what we're pumping up. You can better adapt to what's already up there and continuing to get pumped up. And you can remove. Why not just call it removal, the third bucket?
Marcius Extavour (00:39:22):
Maybe that's a good name for it. All I'm trying to say is I think there is a third bucket, so let's call it removals, the third bucket. So I see it in a third bucket that way. The other difference is that most CO2 utilization technologies or projects are not carbon negative, cannot be carbon negative. That's not bad, but to the extent that there's a third bucket, it's important to keep the bucket separate. And so that's, even though they're two prizes, same organization, they have carbon the name, the overlap between the solutions, I think, is actually quite small. There are a few that could be considered utilization and removal, but quite a small number, I think. And that's neither here nor there, but it's just interesting. And that's one way they're differentiated.
Jason Jacobs (00:40:05):
So if you're just utilizing carbon, why does it matter if the carbon is carbon at the exit stop, as you were describing, or if it's carbon that gets removed that was already up there from years ago?
Marcius Extavour (00:40:16):
Right. Great question. It doesn't. It doesn't at all. So if I give you a bottle of CO2 and you know how to make carbon nano tubes out of it, you don't care where the CO2 came from, and you don't need to care. Now, if you implement the CO2 utilization... Sorry, if you source your CO2 from the sky, then you have a chance at making a carbon negative solution. And actually, carbon nano tubes, if they're long lived, might be one of those carbon negative solution possibilities. On the other hand, if you choose to source your CO2 from a post-combustion source, a post-fossil fuel combustion source in particular, it almost certainly will never be carbon negative, but it'll mitigate the emissions. So utilization can play both or be in multiple buckets, which is interesting.
Jason Jacobs (00:41:04):
And so what led you to decide that carbon removal, well, one, that you should do a second program in this area, and two, that it should be carbon removal?
Marcius Extavour (00:41:14):
Great question. So we were going through our exercise... You asked me earlier in the conversation, how do we pick our things? And is it the idea or is it the money that talks? So this is this example playing out in real time. We have, basically, an annual ideation festival that we called visioneering, and this is something we're retooling to be a little more intentional. But anyway, having an ideation festival, people come together, workshops, ideating, etc, etc. And I have to say, much to my surprise, somebody in the community, in our extended partner, and donor, and supporter community said, "What we should really do is something about carbon extraction," they called it. And I remember my first thought being like, "But we were literally doing a CO2 utilization prize now. Why don't we do something a little more differentiated?" That was just the first thing that flashed in my mind, but then I take a breath and I was like, "Okay. Well, I mean, it's an interesting topic." I remember, literally, my first day on the job was at the launch party of the Carbon XPRIZE NRG Cosia. And somebody came up to me and was like, "You should really think about direct air capture." And I was like, "What are you talking about? We literally just launched this. That's out of scope." Actually, it was Peter Eisenberger. He was like, "Yeah, this prize is cute and everything, but really the main thing is direct air capture. That's what you should do." And I was like, "Okay, nice to meet you too, Peter. And let's talk about it. And I just got here. I don't know what you're talking about." But that stuck with me.
Marcius Extavour (00:42:31):
So the idea of direct air capture CDR is unavoidable when you're thinking about utilization. So it was always a topic we were looking at, but thinking, "We don't have a mandate to work on that." Then, all of a sudden, the door opened for us, from outside to be like, "We'd like you to work on this". And so my group jumped on it. We started, in parallel with running this one prize, designing another prize. And we took it, as I said earlier, like, "All right, how would we do all the things that we think we're doing well better? And how would we do all the things that we're not doing well, how would we correct those mistakes? If we had the chance to design a prize from scratch, how would we do it?" And so we baked our learnings in. So that's how we decided to do it. I'm not going to say it was part of a grand strategy, and we said the next thing to do is removal. It just came to us from our community. We got a bit of funding to explore it. And then we were pretty excited about it. And then we started our main fundraising campaign to raise the 100 million plus to actually make the thing real and launch it.
Jason Jacobs (00:43:25):
I mean, I can rattle off some of the objections that I hear out there. Did you hear all those... I mean, without rattling it off, I'll start. Did you hear the objections that you thought you would about all the reasons why carbon removal is a distraction and counterproductive to pursue?
Marcius Extavour (00:43:44):
We definitely did. I mean, feel free to rattle by the way because I think it's productive to engage with the viewpoints. We definitely heard the moral hazard argument in spades, and we still do. I mean, I think that's still an active conversation in the field. It's something that, actually, I don't mind saying I've lost a lot of sleep over, not because... I am quite convinced that carbon removal is important, essential, and can be done without that moral hazard, but I also see the hazard and I see the risk. So I feel like we're walking a very fine line, and we have to constantly make sure we're in the right place because it will be easy to slide into that hazard territory. So I see that as an ongoing risk to mitigate, not like, ugh, it's not a risk, just ignore it. I don't think that way at all.
Jason Jacobs (00:44:34):
And I'd love to double click on that moral hazard piece that you mentioned and the tight rope. What is the tight rope? You mentioned seeping into the category of moral hazard, or I don't know if you use that exact word, but what do you mean by that? What types of things would seep into that, and what types of things would enable you to steer clear?
Marcius Extavour (00:44:52):
Yeah. Great question. For me, there are two primary risks that fall into what people call the moral hazard argument. One is, if you come at this with a zero sum money mentality, meaning we only have $1 to spend on climate, and we have to choose carefully where to spend it, and that means we have to prioritize solutions and spending, if you come at it from that perspective, then it raises the question, is carbon removal the most important thing to focus on? Or maybe a more nuanced version is, out of that $1, how many cents should go towards carbon removal? And how many cents should go towards, I don't know, adaptation of all types? And how many cents should go towards fuel switching to renewables, or low carbon sources, or name whatever you think is another effective climate solution? So I think there's that. And the fear there is, every dollar that goes towards something that's not at the top of the list, i.e. carbon removal, is a dollar wasted. I'll just say that that one I think is just not true.
Jason Jacobs (00:45:52):
Yeah. That one drives me crazy, to be honest.
Marcius Extavour (00:45:54):
Yeah. I just want to lay it out in fairness. If somebody's listening and thinks I've misrepresented it, please represent it the way you think is more fair. I'm honestly trying to do a fair job here. I don't believe that for a second. I think it's just false and wrong. The reason is we know there is no single solution to our climate problem, even if we come up with a priority list. And I will even grant that carbon removal is not the most important climate action we could do today in the year 2022. However, if it is an essential solution that we'll need over time, then we have to start working on it. And I think, as long as we keep it in the right balance, it's important. So how we try to mitigate that personally or professionally at XPRIZE is we just say out loud, the most important thing we should do is mitigate our emissions. Stop emissions, turn them down, reduce them. Do everything possible to reduce. However, there are some other things we need to do. One of them is carbon removal. And we have chosen to focus on that because we think we have the skills and resources to do that now.
Marcius Extavour (00:46:48):
So that's one path, but the other one is maybe the more tricky one. And that is a focus on something like carbon removal, which, let's face it, is a very attractive idea. It's a very attractive concept that, wait a minute, maybe I, as a polluter, don't have to do anything. Somebody else is going to come to the rescue with a bolt-on solution that requires me to literally do nothing. This is like hitting the snooze button. It's like getting someone else to solve your problem. It's a very attractive idea. Of course, if you are somebody that thinks that we need to change systematically how our economy works and how our civilization is powered, almost, then you detest that thought because you're looking for true transformation from within, not some external cavalry type, savior, whizbang, tech solution. So I'm quite sensitive to that argument.
Marcius Extavour (00:47:45):
If the perception sets in that carbon removal is, A, an excuse for not actually stopping emissions, and B, that it represents a "solution to our climate problem," full stop, then we're screwed. This is the perception we must resist at all costs. Now, I think what we can do, again, is to just say out loud, like I'm trying to say now, "That's not the case. That's not the proper interpretation of how to think about carbon removal. It's a need to have, not a nice to have, but it has to work in compliment with many other things."
Marcius Extavour (00:48:20):
But there's still the risk that, look, we're trying to do a prize in public. XPRIZE has a certain level of brand recognition in some circles, our sponsor, Elon Musk and Musk Foundation definitely do. So we're bringing a lot of attention to the space, which is our goal, but there's always the risk that some people interpret that or a casual observer of the competition is like, "Oh, wait, great. Some tech people think they've 'solved climate.' It's this thing called carbon removal. It's all done. All we have to do is build these things," which is just not the way it is. And just not the way it's going to go down in any, I think, rational universe going forward. So, for me, that's the risk that I'm constantly on guard of. We have to watch the way the field is discussed. We have to make allies with people who see it the way we do. We have to make it clear where we stand. We have to support others that are speaking to the topic, but I think it's important to acknowledge the risk too. That's just the honest and, I think, good faith way to go about this. So that's how I think about it.
Jason Jacobs (00:49:15):
And so when you set out to build the program, what was your assessment of the carbon removal landscape? Where was it, and where did it need to get to, and what were the biggest barriers holding it back?
Marcius Extavour (00:49:27):
Yeah. Okay. Well, a couple. One that we thought was quite poignant was that carbon removal is a wonderful concept with a lot of great thinkers thinking about it, but very few people attempting to actually do it in the field at something that could be scaled. So we were aware of efforts of some of the leading direct air capture companies, a handful of other CDR demonstrations that had been attempted over time. But, for instance, if we talk about things like ocean CDR, or mineralization of mine tailings, or coastal restoration of wetland sites, those are great concepts that had not been demonstrated at, really, any appreciable scale, sometimes for good reasons.
Marcius Extavour (00:50:08):
So number one, we thought there's just a severe shortage of reliable projects, even at modest scale. And we thought something that's needed to get to the next step is, well, we need some of these things to get tested out. Even at modest scale, it can't just be debate in the academic literature or debate about ideas. It's got to be, well, we tried building one and it failed, and now we know how it failed, and we'll build the second one better. Or we built one and it worked, and we got a lot of data that told us the pathway to scaling this thing goes this way, not that way. So we wanted to try to accelerate learning. So it's just not enough projects.
Marcius Extavour (00:50:42):
The second was not enough people. Getting carbon removal, even to a billion tons a year, never mind something like 10 billion tons a year over time, it's just not going to be done by 50 people, or 75 people, or 500 people. We need more people to work on the topic, and we thought a prize could help with that. And then another gap that we saw, and a lot of people I think will resonate with this, is some of these proposals or some of these concepts for carbon removal are quite difficult to actually know if you've done it. I spoke earlier about the need for a measurable criterion in a prize. Well, you need that for carbon removal. Forget a prize. You just need it for carbon removal. Someone says I've removed 10,000 tons. We'd like to know if that actually happened, or was it 9,000, or was it zero, or what was it?
Marcius Extavour (00:51:26):
So things like ocean CDR, biology-based CDR, some other so-called nature-based solutions, soil-based solutions, it's not easy to measure the carbon flux at all. And so, as framers of a challenge that's, "All right, we'd like you to remove at least 1,000 tons per year." We know we have a problem with them in front of us, which is, well, wait a minute, how would we... Or some solutions it'll be very easy to measure. Yeah. They've done 1,000, or they did 1,200, or they did whatever. Whereas, others, it'll be quite difficult to measure. So what we thought we could do with the prize is also try to help advance the space of measurement or measurement reporting and verification, MRV sometimes people call it, because that's a critical need. And that's something we think the prize can help advance. We have to do it for the prize if we want to have a fair and realistic judging process, which we're committed to, but we know it's something the field needs. And so we're hoping to contribute to that using the prize of the platform. In other words, we have a real, tangible, specific need to measure a bunch of CDR systems. And so we're hoping, and working now to build [inaudible 00:52:26] partnerships to actually make those measurements more viable and more just executable than maybe they were a year or two or five years ago.
Jason Jacobs (00:52:34):
And so, where are you now in terms of phasing? And then, what does the process look like from here?
Marcius Extavour (00:52:42):
Yeah, so the prize is... I'm going to say two numbers with you. The prize is four years long, and it's split into three phases. We just finished the first year and the first two phases. So the first phase was a student-only competition. That means teams formed by mostly students. And it was basically an ideas competition. Submit your proposal, the judges will review them, and they'll fund the best ideas. We're actually just about to issue the second half of our winner payments. So each winner got either $100,000 if they're working on MRV, or a $250,000. And we split them into two, half upfront, half midway. And we're about to issue the second half of those payments right now. So that's five million bucks out of the 100. That was in the fall of 2021.
Marcius Extavour (00:53:27):
The second phase was the one we just wrapped up in the spring. We called it the milestone round. This was teams that want to win the grand prize, which means they plan to, or are already building, a full, complete working CDR demo of some kind. And we said, "Okay, you don't have to have 1,000 tons per year at minimum. You're going to have to have that minimum three years from now, but you have to have something built, something started. Show us data that you have something working, and show your plan on how you get to at least 1,000 over the next couple years, tons per year." And that was another $15 million of the $800 million prize pool.
Marcius Extavour (00:54:02):
What comes next now is we have three years left, and the grand prize is going to be 50 for first place and then 30 to be split among second, third, maybe fourth place, depending. And then it's going to be the judge's discretion. And we're going to share more details on how that'll be selected as we go.
Marcius Extavour (00:54:19):
And then what we do at XPRIZE to get busy is not just planning for that final selection, but we are focusing heavily on our MRV, making sure we are ready to measure the solutions that will come through the door and try to be finalists. We are working on an environmental justice initiative. We've asked all the competitors to give us their sense of how environmental justice relates to CDR. That's an emerging topic of interest for us. And so, right now, we're just exploring the topic, and we're going to publish our findings in a few months. And then we will figure out whether and how environmental justice perhaps could be part of the evaluation criteria. We don't know how to do that yet, but we'd like to figure that out.
Marcius Extavour (00:54:57):
And then, the third major bucket of our activity is supporting the competitors. We're not a formal accelerator or incubator, but we are really good at bringing partners together at XPRIZE. That's because we have to do our work. So what we'd love to do is form partnerships that we think will actually help the competitors. It could be with engineering support. It could be with legal support. It could be with choosing a physical site to actually launch or deploy their demonstration. We've actually just surveyed all the competitors on, "Tell us what you think you need and what would be useful to you." And now we're trying to digest that. And we can't fulfill every need, but what we can do is to, if we can, make partnerships that'll help fulfill some of those needs. Again, this is something we can do as a nonprofit to try to use our network to help the space grow. So those are three big buckets of activity for us over the next couple years.
Jason Jacobs (00:55:44):
When it comes to MRV, I have two parts to this question. One is, how different is the measurement process and tooling required from solution area to a solution area? And a second is, where do these certification bodies, like the Veras or the ACRs fit into that process, if at all?
Marcius Extavour (00:56:03):
Yeah. Great question. It's funny. We just had a meeting on this internally a couple days ago, and we continue to meet on it regularly. Really good question by the way. This is, I think, key question in the CDR world. So the answer to the first question is they vary quite a bit. If someone says they're growing kelp in the ocean and they're going to harvest the kelp and turn some of it into food, and they're going to let a lot of the other kelp sink to the bottom of the ocean, okay, that's quite difficult to measure. Measuring sinking biomass to the ocean floor, honestly, it sounds like a nightmare. There's a lot of chemistry. There's a lot of physics involved. I don't mean any disrespect to anyone doing that work. I just think it's difficult to measure.
Marcius Extavour (00:56:38):
Others, like direct air capture, I think it'll be pretty straightforward. At the end of the day, no matter what's inside your direct air capture black box, you're spitting out a stream of pure CO2. I can go on eBay today, buy a CO2 sensor, strap it onto your outlet pipe, and I'll get a accurate measurement of how much CO2 is collected by the direct air capture machine. So the opportunities and simplicity of measuring the flow rate of CO2 through a CDR system can vary wildly.
Marcius Extavour (00:57:07):
But to your second question, and this is I think our path to a solution, how are the other standard setting bodies involved? The challenge in front of us as XPRIZE is we're going to have a discreet specific number of projects that we have to measure. We aren't necessarily in the business of building, let's say, new methodologies for, to use the example, how macroalgae CDR solutions should be evaluated. We're not trying to do it that way, but we will have the specific task of measuring maybe a specific macroalgae project, or maybe a specific mineralization project, or a specific DAC technology. What we'd like to do is, frankly, get to know the folks at Gold Standard, Vera, [inaudible 00:57:46], all the other folks that are generating methodologies. And if they've got some already, adapt them to the specific projects that we need to use. And if we don't have methodologies, perhaps work with them to help them develop methodologies. In the worst case, we will have to develop a protocol on our own, but that's one way we imagine working with those folks.
Marcius Extavour (00:58:04):
I'll just say we've had a lot of conversations with many of the other folks in the community, people that are doing purchasing, like the Frontier community, and Stripe, and Shopify, Microsoft, people that are funding from a venture perspective, people that want to purchase credits. All of these folks have a shared interest in seeing pretty simple and clear standards and reliable measurement process. And we're right there with them in that need. We also have a pressing need because we have to figure this out basically in the next three years for our specific projects. And we don't know what those projects will be yet because we don't know who the finalists are, but we imagine this as being a bucket that we've got to carry, but we also want to share our learnings with other folks or lean on work that they've done, and hopefully, make a bit of a community collaborative effect here because it's to all of our interest and benefit to make easier, cheaper, more reliable MRV for as many different CDR solutions as seem viable.
Jason Jacobs (00:58:58):
You talked about the quantity. Does cost factor into your assessment at all?
Marcius Extavour (00:59:03):
Yeah, it does. So the three big factors of evaluation are what we call operational performance, which is a long way of saying, does it actually work? And there's a minimum scale. We want to see it work. Whatever your CDR process, it actually has to work, do real removal at least a thousand tons a year to win. The second criteria is cost. We have developed a simple cost worksheet for a hypothetical system that's a million tons per year. If people have real systems that are a million tons per year, great. But if they're not at that scale, we asking everyone to evaluate their costs using a standard method that we've put forward, and we're going to refine again for our finals on cost.
Marcius Extavour (00:59:43):
And then the third section is scalability. Can this actually scale to climate relevant scale? Which we nominally put at a gigaton a year. Could the solution get to a gigaton of year? And that includes everything from social injustice considerations, potentially. It definitely includes life cycle analysis. It includes things like, are we going to fundamentally run out of some metal or do you need half the electricity on earth to scale your solution to a climate relevant scale? So these are all things that the competitors have to convince the judges of in order to win the competition.
Jason Jacobs (01:00:15):
And when you look at the space, overall, I mean, does it ultimately become a commodity or how does this play out? I mean, it just strikes me that if I'm a buyer, as long as it meets certain standards, then I'm purely motivated by, is there enough inventory and is it at an attractive price?
Marcius Extavour (01:00:34):
You're right. So I'm going to make a wild claim, but here's my wild claim/hot take on how CDR can or could develop. I think it'll bifurcate into two big chunks. The first chunk is going to be carbon credits, and that will be a commodity. And that's actually a good thing. I am a manufacturer. I do my best to reduce my emissions as far as I can, ideally, or frankly, maybe I'm just lazy and I don't want to change my business at all. And what I want to do is offset the remainder of my emissions with some quality carbon credit. I know the word offset is becoming a dirty word, so I'm just going to call it a carbon credit.
Marcius Extavour (01:01:16):
There, you really don't need to care what the technology that supplied that credit is, whether it was a forestry play, or a direct air capture box, or a mineralization thing, or whatever. You just want quantity in price exactly as you said. And I think that is happening, even though the market is totally outstripped right now by demand. And I think it can continue to happen if we bring demand online. Okay. But the other thing that I think will happen, and, to me, this is maybe just as interesting or more is some CDR solutions produce other benefits aside from the carbon removal. And those, I think, will be recognized and integrated into those different industries. So for instance, agricultural solutions that perhaps guide more carbon into the soil and give more soil carbon and moisture retention could generate credits, but they also have other benefits. And those benefits might be more relevant to, let say, farmers or agricultural communities. And they will adopt those solutions if they work for those reasons. And they may see the carbon credit revenue as an interesting side benefit, or maybe something that makes the whole project pencil out.
Marcius Extavour (01:02:18):
Another example is coastal restoration. There are many reasons to restore coastal wetlands that have nothing to do with carbon. If they provide a carbon credit benefit, wonderful. That can be a commoditized revenue source, but communities will care about that anyway, or for different reasons. Not despite a carbon credit revenue, but inclusive of the carbon credit revenue and other factors. And so this other group of... I'm breaking this into the credit service and everything else service, and that everything else is going to find its home in different industries for forestry, for mining, for community development, for marine life, for all kinds of different things, wherever carbon removal is relevant. I don't think we're very close to that yet, but an indicator.
Marcius Extavour (01:03:02):
Look, I'm a scientist. So if I make a prediction, I should tell you how to tell if my prediction is true. If in a few years people stop referring to carbon removal as one monolithic thing or one monolithic field, but start to think of it as actually a handful of interconnected activities, what they have in common is, yeah, they all remove carbon in the carbon negative way and maybe they even produce credits, but the way the carbon solutions are applied and adapted in manufacturing is totally different than farming, is totally different than DAC, is totally different than ocean plays. That, I think, will be a positive sign because it'll show we're maturing as a field. And we're on our way to realizing as many of the benefits as there may be in all these solutions.
Jason Jacobs (01:03:45):
And what about as it relates to the voluntary market and some of the initiatives of some early adopters, whether it be the Stripes, or Shopifys, or others that are overpaying for quality to help jumpstart the market? How far can that take us and how important is the... I'm blanking on the word. So it's voluntary and?
Marcius Extavour (01:04:11):
Yeah. Compliance, maybe so people call it.
Jason Jacobs (01:04:13):
Compliance. Yeah. There you go. Yeah. So how important is the compliance market? And therefore, corresponding policy or regulation to make the compliance market?
Marcius Extavour (01:04:24):
Really good question. I'll answer it in two ways. What I really believe deep in my heart is that the compliance market is the key thing, is the key unlock, and that we can't get there without it. I love the waste disposal analogy for carbon removal, that I'll credit to Klaus Lackner. He's the first person I heard develop this. In the same way that, unfortunately, human beings just don't pick up trash in the street out of the goodness of our heart, it requires the state to say, "I'll give you a fine if you throw trash in the street." And this created a space for waste removal and, hopefully, keeping our streets clean. Okay. Total oversimplification, but hope the idea comes through.
Marcius Extavour (01:05:04):
I don't think the voluntary market will take us all the way, but the voluntary market is also a crucial spark. It's the voluntary market that is the first mover. It's the people that want to do this, that aren't forced to do this, because they're backed into a corner, that are leading the way right now. That means, all the purchasers you just mentioned. It means all the innovators that are working on this imagining and hoping that a compliance market comes through on the back end to make their business model solvent or to help their businesses grow. So I think it's essential on the long run, but I don't, for a second, want to discount the voluntary markets in the short-term because they're actually the trailblazers now, and are de-risking it so that, hopefully, the compliance markets can step in.
Marcius Extavour (01:05:42):
Okay. But there's just one other thing I want to say. And that's, even though that's what I believe will happen, and that's not a novel viewpoint, I am maybe too optimistic sometimes, but I think it is possible, and maybe even interesting and desirable for the voluntary market to grow to a much larger size than even my cynical practical view just now would have it. In other words, will companies... And I think it happens like this, companies realize that there's a business, or social, or commercial opportunity for us to jump onto the CDR thing and explore it for our own business, not because the government, and city, or state, or federal, or whatever is telling us that we must, and not just for defensive reasons, because we think that they're going to tell us to do this in five years, but that we actually think it's better for our business because of talent retention, or technology development, or customer development, or our internal climate goals, or whatever, to actually lean into this voluntarily. And the reason I think that could happen is, well, I did not see the voluntary market and purchasing programs that we see today coming at all. And I work in this area, and I didn't see that coming even a few years ago. And that has really surprised me.
Jason Jacobs (01:06:57):
Because it's not rational, right?
Marcius Extavour (01:06:58):
Exactly. It's not rational the way the economists tell us to work. Look, I love economists and they're usually right, but they're not always right. And I think climate has risen into the public consciousness in a way that surprises me and continues to surprise me. And I think that can lead to unintended outcomes. And so I'm optimistic that the voluntary market can really grow and push us forward maybe in a way that we just didn't see coming. So I always leave room for that and try to encourage that as well, even though I think compliance is really important.
Jason Jacobs (01:07:31):
Okay. So help me understand this. On the one hand, we need these markets to grow, but I don't see how they grow without running into the challenge that you talked about earlier about giving polluters permission to keep polluting. So it's like the more they grow, the more it gets... Those are intertwined, right? So if you want to avoid giving polluters the permission to keep polluting, then wouldn't these markets growing a lot make it harder to avoid that?
Marcius Extavour (01:08:00):
I think it might. It definitely might. And I think this is one of the reasons people, some people, detest the idea of carbon credits. They've been called false solution. They've been called boondoggle scam, etc. I don't believe that. I think they're a tool, and they can be used well, or they can be misused. This is my blunt reaction to that thought. Do we want to solve the climate problem, or do we want revenge on the polluters? I want revenge as much as the next person. I'll just say that right out loud. But I want to solve the climate problem more than I want revenge. So if we have a carbon credit system that results in, yeah, some people loafing on the rest of us and continuing their polluting ways, but that, on net, the climate is improved and global CO2 emissions go down, I think I might be able to live with that. That might not be a fair framing, but that's one way that I think about it. Do we want to solve climate, or do we want revenge on the polluters? And I will choose climate, not because I think I'm virtuous or anything like that, but because I think it's just more practical.
Jason Jacobs (01:09:03):
Yeah. I'm really interested for this to ship because I think it's going to spur a lot of interesting dialogue. It's just such a nuanced topic. And I feel sometimes that people are a lot more aligned than they think, but everyone feels the need to play devil's advocate on everyone else. And then social media just rewards polarization, and it doesn't reward nuance. It's not a good format to sort through nuance. That's why I love these long form discussions, by the way, is that you can't avoid nuance. It's not a sound bite because there's another human on the other side and you're going to keep talking.
Marcius Extavour (01:09:40):
You got to get into it. This is why I love podcasts too. And this is why I appreciate what you all are up to. I mean, I think it's incredibly tricky and nuanced. And I am personally extremely frustrated by the way I see carbon credits being developed, not in CDR per se, but in a lot of other places. I think it's real frustrating. And so I definitely see that challenge and that downside. I like to think that we're more aligned that we think, but I also think the idea that we will have universally applied justice for past wrongs, and get to a better place, and that all those things can happen at once. I find that difficult to imagine, not because I'm not in favor of those things, but it's hard for me to imagine that. And that forces, in a pretty cold way, a prioritization of what our goals are. And even saying that, doesn't sound very good. And I hope this does trigger some conversation. I'm sure it will because I know everyone's going to see it slightly differently. But I think, at some level, we have to weigh and wrestle with these huge forces, and really ask ourselves. I don't mean for a second we need to let polluters off the hook or legacy emitters off the hook. We want them to be leaders, and we want them to be part of this. And we want to get them to a place where they feel like they actually can be about it, and not become in opposition. But of course, some people are going to stay in opposition no matter what. And we've got to do everything we can to put pressure on those folks.
Marcius Extavour (01:10:58):
But the thing that matters for climate is not what I think, my preferred solution, your preferred solution, anyone's preferred method or approach. What matters in the end, unfortunately, or fortunately, climate is a physical phenomenon. It's nature, the interactions in nature, science, physics, history, however lens you want to look at it, that is independent of our human ambitions and is independent of our human thoughts and feelings. And that's at least one way to measure our progress. Are the global CO2 emissions going up or down? Right now, they're going up. At the point that we crust and start to bring them down, we can start to pat ourselves in the back and say, "Maybe we've done something," but that's really the most important thing to keep in focus if we're talking about this climate problem.
Jason Jacobs (01:11:42):
So when you look at the state of carbon removal today, and we've talked about some of the things you're trying to achieve with the XPRIZE and this carbon removal initiative, but what about the stuff that's outside of the scope of your control? If you could wave your magic wand and change one thing that would help accelerate the wide scale adoption and impact of this field, what would you change and how would you change it?
Marcius Extavour (01:12:09):
I love magic wands. I've tried to make many and they never work, but I would highlight successes. I would highlight successes. We're actually in a period of incredible growth and optimism in the carbon removal world, even though, yes, it's a relatively small piece of the climate puzzle. That's okay. That's appropriate. But the climate narrative is very quickly coalescing around, we're screwed, and there's nothing we can do about this. And that is a real dangerous idea. We don't want that idea to take hold.
Marcius Extavour (01:12:46):
Rather than just saying, "It's not true. We're trying to be too Pollyanna about it," I think an effective way to counter that is to point to realistic solutions. And yeah, they're small, and yeah, they're emergent, and that's what it means to develop new solutions. That's how change starts. So I would love to see more highlighting of success stories, not because we need to pretend that they're everything or that they're fully baked, but because we need a little bit of forward-looking, data-driven, optimism to counter what is invariably the click bait of, we're screwed, it's getting worse, because that leads to disengagement and laugh of hope. And if we lose that, we truly are screwed.
Jason Jacobs (01:13:24):
And what about zooming back into the work you're doing with XPRIZE? What can listeners do ,if anything, to help you and the work that you're doing with the organization and with the carbon removal prize specifically?
Marcius Extavour (01:13:39):
Great question. Well, we love to meet new friends and really find allies and partners we can work with. Just, I think, two things, if somebody's listening and they want to get involved or maybe participate. One is find a team that's competing and support them. They're all raising money. They're all looking for skills. They all need networks. They all need talent. Whether you're looking for a job, or you're just looking to maybe be an advisor, or a supporter, or a cheerleader, these are all early stage solutions. Sometimes they're startups, they're struggling and doing what they can to grow and evolve, and they could use a lot of help and support. Whether you love direct air capture, or algae, or mineralization, or whatever, whatever flavor of CDR you have, there's something for you in this competition because we have so many great competitors from everywhere trying all kinds of different pathways. That's one thing I'd say.
Marcius Extavour (01:14:27):
The other thing I would say is, to work directly with my group at XPRIZE and our organization, the thing we're really looking to do is, if you think you have perhaps a way to support the competitors in a more broad way that isn't specific, but you are working at engineering company and you think you or your group might have a few pro bono hours, or you work for your municipality that is interested to attract projects to your region, or you're a lawyer and you know how to help people file patents or license patents or things like that, these are all great skills and resources that the cohort of competitors in the prize can use. And the reason I bring this up is, XPRIZE, internally, in our team, I'll give shout outs to my colleagues like Roopa Dandamudi, and Mike Leitch, and Nikki Batchelor, who are all working hard on this. They are really trying to build a system or a portal or something, we're not sure yet, whereby we can bring these partnerships in and make them accessible to our competitors in a more bulk and efficient way, rather than one off conversations.
Marcius Extavour (01:15:28):
So if you are working in an organization that you think could be helpful to the CDR space generally, and to some early stage solution developers particularly, we'd love to chat with you because there might be a way for us to connect you with the cohort in a, hopefully, simple way for you and for them that'll, not just be... I mean, we like that we're not raising money for the prize. Let me make that clear. We're not trying to fundraise from folks. We're really saying, "Hey, how can we connect resources with people that need resources?" Because that's something we think we can do to help grow the space using this platform of the prize.
Jason Jacobs (01:15:59):
Great. And Marcius, is there anything I didn't ask that I should have, or any parting words?
Marcius Extavour (01:16:05):
You asked a lot of really fantastic questions. I'm not just saying that. So I appreciate that because I love to get into stuff and try to explore the details from different angles. My only parting words would be, let's keep doing what we're doing. There's a lot of great enthusiasm in this field. One of the reasons I like working in carbon removal is people are pretty excited, not just about the topic, but to have something practical, tangible solution-oriented to work on. I feel that when I'm in AirMiners. I feel that when I go to meetings, starting to do that again, thankfully. And I feel it around, not the office, but the virtual office when we work on this internally. So I would say, let's all keep doing what we're doing. This isn't going to be one prize, one purchase, one company that gets us over the hump, but it's actually the community effect. And as corny as that sounds, I think we have a good shot at getting there with that because we have a strong community base already. Let's grow it. Let's grow it globally. Let's keep it inclusive. Let's stay curious. And let's just keep getting after it
Jason Jacobs (01:17:02):
Love that. Well, such a great point to end on in such a wonderful discussion. So thanks again for coming on the show. And can't wait to see what happens with the prize.
Marcius Extavour (01:17:11):
Thanks so much. I really appreciate discussion and real question to be here.
Jason Jacobs (01:17:14):
Hey, everyone, Jason here. Thanks again for joining me on My Climate Journey. If you'd like to learn more about the journey, you can visit us at myclimatejourney.co. Note, that is .co, not .com. Someday we'll get the .com, but right now, .co. You can also find me on Twitter at JJacobs22, where I would encourage you to share your feedback on the episode, or suggestions for future guests you'd like to hear. And before I let you go, if you enjoyed the show, please share an episode with a friend or consider leaving a review on iTunes. The lawyers made me say that. Thank you.

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Episode 218: Marcius Extavour, XPRIZE

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