Climos Grabs $3.5M to Fertilize Ocean

by Justin Moresco on 05 March 2008, 13:40

Categories: General news - Cleantech - Internet
Topics: Climos , Planktos , Ocean Iron Fertilization


Technology startups can always depend on the audacity of their ideas to generate attention. Climos is one of them. The San Francisco startup, which closed a $3.5 million, first round of venture financing on Wednesday, wants to help the ocean capture carbon dioxide, the major culprit among greenhouse gasses.

“They have created a strong business plan for advancing this technology while addressing the questions surrounding it, which led to our funding of the company,” said Dennis Costello, of Braemer Energy Ventures, in a statement.

Climos proposes doing this by seeding the ocean with iron, which will promote the growth of carbon-consuming phytoplankton. At the end of its 60-day lifecycle, a portion of the plankton sinks and locks away the carbon for long periods of time.

The company could then sell the carbon offsets in voluntary and mandatory carbon credit markets around the world.

The science behind the process—known as Ocean Iron Fertilization—is not new. But there are still questions about its ability to sequester carbon and its safety and appropriateness.

That’s why financing from the round will be used to fund an Environmental Impact Assessment and a series of science workshops with research organizations. The company hopes to do a demonstration cruise in 2009, said Climos CEO Dan Whaley, and if successful, immediately begin selling carbon credits.

The company aims to sell those credits at $5 to $7 per ton, said Mr. Whaley. That price would fall within the current wholesale range, which is between $1 and $10 on voluntary markets, said Jason Patrick of Evolution Markets, a New York-based bank and brokerage.

But Mr. Patrick said the value of carbon offsets depends, among other factors, on the project type. That means that if Climos’ approach isn’t widely accepted, its offsets could find a tight-fisted market.

Planktos, another company focused on Ocean Iron Fertilization, announced in February that is was indefinitely postponing its efforts to generate offsets for carbon credit markets. The company cited a “highly effective disinformation campaign” that made it difficult to raise capital to further its research.

Climos, at least in the near future, won’t have to worry about raising money. Besides New York-based Braemer Energy Venture, Elon Musk, chairman of electric carmaker Tesla, also participated in the VC round.