🤔 What is really happening to Direct Air Capture?

📊 Lots has been written about this topic lately. Personally, I like to look at the data–not the gossip. That’s why I was so excited when I saw @cdr.fyi’s incredibly timely “Direct Air Capture Market Snapshot H1 2025” come out yesterday.

😬 On the surface, it doesn’t look good: of 167 DAC companies (as per @grant faber’s latest list - see comments), only 31 have made a sale, and only 2 (!) have delivered any CDR.

🤏 Almost 2.5Mt of DAC credits have been sold to date - of which 80% by just three companies (1PointFive, Climeworks and Heirloom) - but a meagre 0.05% or 1,186t were delivered.

💰 All of this against the backdrop of having received over $2.3b in private investment, plenty of historical policy support (e.g. 45Q, CCUS ITC, etc.), and a lot of media attention/hype.

🏗️ So has DAC failed? Not really. The authors predict a few years of consolidation around the most viable business models and technologies. Interestingly, they also believe that low CAPEX per tonne–not energy efficiency–will dominate this consolidation.

📦 On the abysmal delivery rate - in my eyes clearly the achilles heel of DAC right now - the authors stress that, while disappointing, this shouldn’t be the focus right now. Instead, we need to expand access to storage, drive down CAPEX costs, and keep rallying political support. Deliveries will follow.

📈 My take: I still believe DAC will be the leading CDR technology at net-zero. Nothing can compare to its scaling potential. Having said that, a dose of humility would do the sector good.

🙅 The constant overpromising - especially around cost reductions, energy use, delivery timelines, etc. - are understandable from a startup perspective, but unnecessary ammunition to all the DAC haters out there - and there are plenty…

👷 So let’s keep building and scaling DAC, but without misleading investors and the public alike on what DAC can deliver and by when.

❓ What is your take on all of this? What takeaways do you draw from this data?

Big shout-out to the amazing work by the team at CDR.fyi Tank Chen, Jason Grillo, Robert Höglund, Maximilian Olmos van Velden, and Soren Vines, as well as DAC legends Jack Andreasen Cavanaugh, Jason Hochman, and Phil De Luna who reviewed the report.

Follow the conversation