Carbon neutrality as an

opportunity for value creation

While challenges such as early-stage adoption and cost barriers persist, carbon
neutrality efforts also provide clear opportunities for growth and resilience

Fred van Beuningen

Chrysalix Venture Capital

A
dditional headwinds are expected neutrality still represents a significant
to be forthcoming in the global fight opportunity for creating strategic value.
against climate change and the broader Greenwashing was possible for some time,
sustainability objectives of companies, notably but with climate risks becoming increasingly
in anticipation of the new US administration. apparent, fiduciary duty forces investors and
We anticipate: industrial companies to be real and factual about
• US withdrawal from the Paris Agreement: climate risks to their portfolios and supply chains.
Rejoining the global climate deal was one Investors increasingly prioritise companies
of the Biden administration’s first executive with robust decarbonisation strategies,
orders, so it would be symbolic for the recognising that addressing climate risks is
Trump administration to reverse this decision essential for long-term business resilience and
immediately. The Paris Agreement’s three-year growth. To achieve carbon neutrality, companies
exit period is another factor to motivate an focus on value creation strategies such as asset
early announcement of the US withdrawal from decarbonisation, leveraging green premiums,
developing new growth platforms, managing

“prioritise
Investors increasingly
companies with robust
risks from supply chain vulnerabilities and
carbon pricing, and shifting portfolios.
Tight timelines add to this urgency: achieving
decarbonisation strategies, net-zero targets by 2050 requires a rapid
recognising that addressing climate transition to carbon-negative operations by
risks is essential for long-term 2030. However, a significant percentage of
business resilience and growth
” the technologies needed to meet these goals
are still in early adoption or pre-commercial
stages. Technologies like green hydrogen are
participation (UNFCCC, 2015). Such instability currently too expensive, and carbon capture and
in government policy is clearly not conducive to utilisation (CCU) has not yet reached commercial
a positive investment environment. scalability. Addressing these gaps requires
• US scrapping of non-business-oriented early-stage investment, which is critical for
climate funding: A full repeal of the Inflation developing scalable solutions.
Reduction Act is unlikely, as it would hurt To achieve its climate targets, the EU will
business interests in Republican states and require additional annual investments of about
is ultimately in the control of Congress. In the 2% of gross domestic product (GDP) between
short term, defunding of other climate policies 2025 and 2030, comparable to the EU’s R&D
(such as funding for agencies and research spending in 2022, which was estimated at 2.2%
projects) under the Trump administration is of GDP (Eurostat, 2024). With the European
more likely. Green Deal, the EU has positioned itself as the
However, despite such setbacks, carbon global frontrunner in climate policy. Given the

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 Energy efficiency Alternative fuels Material substitution Circularity
Optimising processes and Replacing fossil fuels with Using low-carbon materials Eliminating waste through
integrating energy recovery low-carbon options like such as biobased polymers resource recovery, recycling
systems to minimise waste hydrogen, biofuels and and advanced composites to and waste-to-value
and maximise output. synthetic fuels. reduce emissions. systems.

Circular carbon systems Carbon markets Negative emission technologies AI as an enabler

Capturing and reusing Monetising emission Removing CO2 through Enhancing efficiency and
emissions as feedstocks reductions through nature-based solutions like accelerating
for industrial applications. carbon credits and offset reforestation, soil carbon decarbonisation through
schemes. sequestration and direct air predictive analytics and
capture. optimisation.

Figure 1 Key carbon neutrality levers and technologies

political economy of global climate action and that address emissions reduction and removal
the likely withdrawal of the US from the Paris across industries (see Figure 1).
Agreement, the success of the European Green Energy efficiency is a foundational element
Deal is vital for global decarbonisation to stand in optimising industrial processes to reduce
a chance. From this global perspective, it should emissions. Transitioning to alternative fuels,
be recalled that the cost of climate action is far such as renewable energy and biofuels, is
lower than the cost of inaction. equally critical. Substituting traditional materials
with low-carbon alternatives further reduces
How companies achieve their net-zero targets embedded emissions.
Reaching net-zero goals requires a clear, Digital technologies, including AI and
strategic approach that combines different advanced analytics, are instrumental in
solutions: optimising resource use and enhancing
• Deep decarbonisation by reducing emissions

“carbon
through technology and operational efficiencies.
• Carbon removal, both within and beyond the We need to shift from viewing
value chain, to address emissions that cannot be neutrality as a cost to seeing it
eliminated.
• Compensation through offsetting, which
as an opportunity for value creation
”
ensures residual emissions are balanced. decision-making across value chains. By
Success depends on aligning financial leveraging data-driven insights, businesses can
resources with these strategies. Companies identify inefficiencies, streamline processes,
with lower capital may start with efficiency and scale climate tech solutions more
improvements, while those with more resources effectively. The integration of digital tools
can invest in advanced technologies or explore into decarbonisation strategies represents a
new business opportunities. Businesses that vital step in future-proofing industries for a
approach carbon neutrality as a chance to grow sustainable economy.
and innovate rather than as a cost can meet
their goals while creating long-term value. Circularity is essential
Circularity could deliver up to 45% of the global
Key carbon neutrality levers and technologies greenhouse gas (GHG) emissions reductions
Decarbonisation relies on a range of technologies needed to achieve net-zero worldwide (Ellen

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 Construction and Demolition waste (CDW) comprises all waste produced by the construction
and demolition of buildings and infrastructure as well as road planning and maintenance.
CDW covers a variety of materials, including concrete and building rubble, and accounts
for more than one-third of all waste generated in the EU. Following the introduction of the
Waste Framework Directive in 2008, most countries in the EU have established practices for
separation, recovery, and reuse of CDW waste, with the best achieving recycling rates of up to
90% (European Commission, 2024).

MacArthur Foundation, 2021) and up to 56% discarded waste concrete rubble continues to be
of the carbon reductions needed to achieve sent to landfill.
net zero in the EU (McKinsey & Co, 2024). Based in the Netherlands, C2CA (concrete
By reusing materials and minimising waste, to cement and aggregates) has developed
circular systems reduce dependency on virgin an industrial-scale solution that transforms
resources and align with decarbonisation waste concrete into high-quality aggregates
goals. They also create operational efficiencies and sand, which are valuable raw materials
and new opportunities for growth. Beyond for construction (see Figure 2). This circular
recycling, circularity involves redesigning approach facilitates concrete-to-concrete
systems to eliminate waste entirely. Secondary recycling, eliminating the need for virgin
raw materials can replace primary inputs, materials and reducing the amount of concrete
significantly lowering emissions. Negative rubble going to landfill as well as carbon
emission technologies, such as nature-based emissions.
solutions and carbon capture, further address The recycling process begins with density-
emissions that cannot otherwise be avoided. based separation to remove contaminants and
extract reusable aggregates. This is followed
Circular concrete by a thermal separation stage to refine the
Every year, the world produces 4.1 billion materials further. Finally, advanced quality
tonnes of cement, which accounts for 8% of control and tracing technologies, such as laser-
global CO2 emissions. At the same time, 3 billion induced breakdown spectroscopy (LIBS) and
tonnes of concrete waste is downcycled or radio frequency identification (RFID), are used to
discarded each year. Previously, no scalable or guarantee material consistency and traceability,
affordable technology existed to process waste ensuring it meets industry quality standards.
concrete beyond downcycling, in which the By 2023, C2CA demonstrated its ability to
material is downgraded or reused in lower-value scale this process, processing more than 1,000
applications like roadbeds. Globally, much of the tons of waste annually. The resulting materials,
including coarse aggregates, fine aggregates,
and ultra fines, are then used to produce new
concrete, supporting a closed-loop system. This
innovation not only reduces reliance on virgin
resources but also provides a practical pathway
to integrate circularity into the construction
sector, significantly lowering its environmental
impact.

Circularity in the metals sector

Steel is the most widely used metal, followed by
aluminum. Both materials are readily recycled,
with 90% steel and 37% aluminium reaching
Figure 2 C2CA system for turning waste end-of-life now recycled in the EU. In their Net
concrete into high-quality materials Zero Roadmap, the IEA requires the widespread

12 www.decarbonisationtechnology.com
adoption of innovations in both primary
2022 2050
production and recycling of steel and aluminium
to minimise emissions and meet growing Steel
demand (see Table 1). Overall demand (Mt/a) 1,880 1,960
There is scope to improve the environmental Share of recycled scrap metal 33% 48%
efficiency and cost of recovery and recycling Share of net-zero iron production 0% 95%
processes. Companies like Sortera Technologies
Aluminium
and Therm Ohm are taking the lead in
Overall demand (Mt/a) 108 146
implementing circularity in the metals sector.
Share of 2 production –
o

Sortera uses AI and sensor fusion technology recycled aluminium 36% 48%
to sort aluminum scrap by alloy and then Share of net-zero 1o production 0% 96%
recycle the scrap into high-value, low-carbon
end products. Its high-throughput platform Table 1 Required adoption of low-emissions
enhances resource recovery, ensures consistent primary production and recycling for steel and
material quality, and improves the efficiency of aluminium Source: IEA, 2023
sorting processes in material-heavy industries.
Meanwhile, Therm Ohm has developed lower carbon products, valorisation of CO2 as a
an innovative process to upcycle steel scrap feedstock, and the development of the voluntary
by removing copper contamination. This carbon removal markets.
breakthrough reduces feedstock costs, Different industries have different carbon-
minimises DRI dilution, enhances the quality neutral pathways. For the chemical industry,
and value of electric arc furnace (EAF) steel there are different sustainable carbon cycles,
production, and generates a sustainable copper including using carbon from industrial processes
byproduct. These efforts support circularity and carbon derived from products that
in metals production and contribute to previously originated from fossil sources, as well
decarbonisation goals.

Conclusion
Upcycling wood, metals, plastics, and concrete
“requires
Achieving carbon neutrality
a combination of enabling
provides an important pathway to carbon technologies, circular systems, and
neutrality. Materials are kept at their highest
value and the energy used is from renewable
strategic investment
”
sources. Venture investment in circularity offers as using carbon from plants (CEFIC, 2024).
a good opportunity, provided the fundamental Achieving carbon neutrality requires a
economics are attractive and allow for rapid combination of enabling technologies, circular
scale-up. The interplay between market drivers, systems, and strategic investment. While
economics, technology, and business models challenges such as early-stage adoption and
determines the viability of circular opportunities. cost barriers persist, carbon neutrality efforts
Circular carbon (CCU), also known as also provide clear opportunities for growth and
valorisation of CO2, can be a future source of resilience. Businesses that act now to embrace
carbon for the production of chemicals, fuels, climate tech and decarbonisation strategies
polymers, and materials. However, to meet will position themselves to succeed in the
current announced net-zero targets, global transition to a sustainable future and create new
CCUS capacity needs to grow more than 100 growth platforms.
times in the longer term, reaching 4-6 gigatons
CO2 by 2050 and decarbonising around 15 LINKS
to 20% of today’s energy-related emissions
(McKinsey, 2024). Circular carbon is challenging More articles from the following categories:
because of cost and technology readiness, Economics
and some of the factors to watch out for are Energy Efficiency
regulatory interventions, willingness to pay for

www.decarbonisationtechnology.com 13
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provider-for-sustainability/circular-carbon www.iea.org/reports/steel-and-aluminium
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