Episode 222: John Dees, Carbon Direct
Today's guest is John Dees, Senior Science Analyst at Carbon Direct.
Carbon Direct is a science-first carbon management firm that enables organizations around the world to reduce, remove, and monitor their carbon emissions. They combine science, technology, and market expertise to help these organizations take action and reach their climate goals. They’re doing some incredible work with clients and portfolio companies spanning 28 countries.
If you've been a longtime listener of the show, Carbon Direct might be a familiar name. The CEO, Jon Goldberg, and Chief Scientist, Julio Friedmann, have been guests in the past. We’ve also talked to Nili Gilbert who's the current Vice Chairwoman before she joined the Carbon Direct team. This episode is unique because John Dees comes from a different background. He's in the trenches, living in excel, and working on life cycle assessments (LCAs) for carbon emissions. We cover the process of doing these LCAs, their level of accuracy, and how they compare across different firms. We also talk about different incentives of the organizations that do LCAs and where they fit into the overall path for carbon removal and our clean future.
Enjoy the show!
You can find Jason on Twitter @jjacobs22, @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 August 1, 2022.
In today's episode, we cover:
An overview of Carbon Direct and where John sits in their portfolio of services
Projects that require life cycle assessments (LCAs)
How he thinks about climate and how his perspective has evolved
How John got involved with carbon removal
Scaling carbon removal to a level that matters
Characteristics to consider when selecting CDR technologies
Barries holding CDR back
The process behind developing LCAs for different projects
Types of clients and business drivers for Carbon Direct's LCA services
The need for LCA standardization and challenges in doing so
Tooling for LCAs and blind spots
Differences in LCAs between small vs. big companies and across sectors
Incentives for a company to care about LCA accuracy
For-profit LCA work vs. non-profit approaches
When companies should start thinking about tracking LCAs
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Jason Jacobs (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 1300 members. There is an application to become a member. It's not an exclusive thing, there's four criteria's we screened 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 non-profits 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. 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 (01:56):
Today's guest is John Dees, senior science analyst at Carbon Direct. Carbon Direct combines science technology and capital to deliver quality CO2 management at scale. They offer software, advisory, and investing services to leading organizations. Now, if you've been a longtime listener of the show, Carbon Direct might be a familiar name to you because Jonathan Goldberg, the CEO in Julio Friedmann, the chief science officer and Nili Gilbert came on the show who's the vice chairwoman even before she worked at Carbon Direct, it's an incredible organization. And I was excited for this one because John Dees comes from a different background. He's in the trenches, living in excel, working on the life cycle assessments for carbon emissions And it was fascinating to talk to him about the process of doing these LCAs where the blind spots are, how good they are, how they compare from firm to firm. What's the different incentives are of the different shops that do this work and where they fit into the overall path for carbon removal. We also have a great discussion about where carbon removal fits into the overall path of decarbonization. At any rate, really great one, and I'm so grateful that John came on the show. John, welcome.
John Dees (03:16):
Thanks for having me, Jason, excited to be here.
Jason Jacobs (03:18):
Thanks for coming. It's funny as we discussed, I mean, Carbon Direct, we're big fans of the organization. We've had Julio on the show multiple times, Julio Friedmann and Jonathan Goldberg's been on the show and actually Nili Gilbert was on the show before she got involved with Carbon Direct. I don't remember if I tweeted or I was looking to talk to people who had expertise around LCAs life cycle assessments for carbon, because it keeps coming up in our portfolio and otherwise Ed Smith over at Solugen, who is a mutual friend, suggested that I talk to you, which I did. And you graciously agreed to come on. And although you're the fourth person from Carbon Direct, you've got a very different role and it's really right in the thick of the action. And so I appreciate it and feel like I'm going to learn a lot here.
John Dees (04:11):
I'm super excited. Yeah, Ed Smith's great. I've enjoyed my work and relationship with Ed and I'm super glad he connected us. Also, gave me a chance to go through your back catalog, which has been quite fun and entertaining. I'm honored. Some folks I look up to very much Costa Samaras was on here. I feel like I'm stepping into some pretty big shoes to fill.
Jason Jacobs (04:29):
Well, great. Although I've heard it before to keep with our format and just to get your spin on it and it's been a while, so maybe it's changed, but tell me about Carbon Direct. What do you guys do?
John Dees (04:40):
I think the general top line is that we combine scientific expertise with software to provide carbon removal and carbon abatement strategies for clients end to end. And that can take the form of anything anywhere between helping clients look at potential carbon removal procurement options, and helping them identify the potential risks and help them highlight potential sources of carbon removal that are high quality to doing things like landscape assessments and supply chain assessments to help clients figure out where they could de carbonize and where they can't figure out where they might be able to procure a good carbon removal to make up the difference.
Jason Jacobs (05:17):
Great. And then where do you sit in that portfolio of services?
John Dees (05:22):
I do a number of things, but primarily I find my nose in an Excel workbook a good portion of the time doing life cycle assessment. Also, I have a background through my PhD work in biomass based carbon removal technologies, and just different ways that we can create value added products out of biomass that remove carbon from the atmosphere. So I sort of sit in two roles, a general advisory on the biomass related stuff, and then oftentimes get called in to do deep-dives on particular projects or particular thematic work that we're looking at that needs a lifecycle assessment.
Jason Jacobs (05:58):
Got it. And one last question there before we'll take a pause on talking about Carbon Direct stuff, but when you say projects that require life cycle assessment, does that mean projects on the advisory side or diligence for investment or some of all, what types of projects do you typically get engaged with within the firm?
John Dees (06:19):
So I would say it's all advisory, but I would caveat that by saying that the Carbon Direct capital management is one of our best clients. So certainly the advisory team gets brought in, I guess, just like you would bring in any other consultant to look at particular projects on the investment side, it's really the same role. I mean, I think that we do for any of our other clients, it could be a carbon removal project. It could be a technology investment and lifecycle assessment is just one part of that, but it's certainly one of these things where you really want to look at the lifecycle carbon intensity or the potential particularly if it's a newer technology to make sure that the claims are vetted and that you can identify any uncertainties or risks that might be associated with the project or technology.
Jason Jacobs (07:05):
Great. Well, we'll come back to that, but what I'd love to talk about now is just to understand how you came to work in carbon lifecycle assessments. Did you know when you were a little kid that's what you would do when you grew up?
John Dees (07:19):
Oh gosh, no.
Jason Jacobs (07:22):
I kind of knew that. Yeah. So that was a loaded question.
John Dees (07:27):
It's kind of hard to track. My dad was a mud engineer for in the oil industry whenever I was a kid. So I guess it was always an awareness of the energy sector. Had two siblings who served in the Gulf wars. So bigger global issues associated with energy, I think have always been situated in the back of my mind. But, honestly, I did a lot of things on up through my late twenties. I've worked in construction, I've worked in manufacturing and I guess I was about 30, and we were in the depths of the 2009 financial crisis. And I decided it'd be a good time to go back to school and get an education. And I actually started my undergrad. I think I was 31 and did a degree in, it was a cross degree between, I don't know if you're familiar with GIS and inter most sensing, but essentially data oriented geography and environmental studies and a confluence of factors, probably coursework and mentors increasingly directed me towards the climate problem. I think it was just abstract thing in my twenties where I knew it was in the news, I knew it was a problem, but just like everybody else in the world, very focused on getting my own life figured out was not so globally focused. But I think as I started to grasp the physical science side of things throughout undergrad, it became a bigger and bigger, more important thing and thought I was going to graduate that undergrad program with my GIS degree and just go to work and do GIS work and things fell in line, good mentors and such. And I wound up going to grad school, UC Berkeley, wound up at the energy and resources group, took Dan Kammen's energy and society course.
Jason Jacobs (09:01):
He came on the show, Dan Kammen.
John Dees (09:03):
Dan Kammen, yeah. So he's chairman of my dissertation committee and thought I was going to do more of a geography oriented thing in grad school and really got oriented towards energy and climate stuff in that first grad school course. And the rest is history.
Jason Jacobs (09:15):
Now, when you first started nosing in this direction, how did you think about the problem?
John Dees (09:22):
Oh gosh, I would say the anxiety is more nascent. I think for me initially, just because the way my brain works, it seemed like a challenge and a problem to be solved. I think as I've had more years studying the problem and being in the mix of actually doing the work, it does become a more present existential threat in your mind on a day-to-day basis. And I think everybody who works in the climate space balances this hopefulness with the occasional balance cynicism, we know whenever things that we need to be doing to make the transition don't always go the way that we hope that they will.
Jason Jacobs (10:00):
And do you find that your views on the type and magnitude of the problem as well as on the path forwards have evolved since you first started thinking about and working in this area? And if so, how?
John Dees (10:16):
Oh, for sure. I grew up in rural Georgia. This is in the places where I grew up it's at least 10 years ago, I would've said that this is one of the regions of the country where it's very difficult to even have these conversations about climate. And I think my initial motivation to go to grad school was that I really thought this was a problem of communication and that perhaps people that were, not people, but I guess the narratives weren't really addressing the things that people care about in places where I grew up and the anxieties that people have about things like we're seeing right now with inflationary energy prices and these types of things, the stuff that sort of hit people at home and they very quickly associate green energy transitions with something that's going to hurt their pocketbook or their job prospects. And I think increasingly Carbon Direct has really been a learning experience for me in giving me an opportunity to get out of academia and hang out with folks that do project development and finance, and think about the business side of this in a way that I never had before. And I now increasingly see it as this incredible opportunity that again has a communication component to it that there are really big opportunities here to not only move us in the direction that we need to go, but also help people on the ground ordinary folks. And I think being able to communicate that effectively is going to be super important to make in progress.
Jason Jacobs (11:38):
And what about carbon removal? How did you get turned onto that and what was it that was compelling to you about researching and working in this area?
John Dees (11:48):
I think initially I was originally drawn into thinking about things as an energy systems analyst very much at the system scale. And I wasn't thinking very big. I was looking at individual technologies that potentially have an impact, but it took a while to situate that into larger conversations about energy systems and think about the big picture. And as time has gone on, I have become increasingly convinced and you'll see in the new IPCC report about the absolute necessity of carbon removal at this point. There may have been a time some years back where there were alternatives to take another road and perhaps not need CDR as much, but we've clearly gotten to a point now where we need CDR, not only to deal with residual emissions that are going to be difficult to decarbonize in our economy, but even once we hit net zero, we have this surplus CO2 in the atmosphere, the ocean, its ability to pull that out is orders magnitude smaller than the problem. And so I feel like we're going to need these technologies to get back to a healthy equilibrium.
Jason Jacobs (12:54):
From what I can gather the IPCC, and as you said, they're factoring in that meaningful carbon removal will happen, but they don't know how it will happen. And so there's a bunch of people that have been working in climate for a long time in different capacities that are really allergic to CDR. And I hear different concerns and I'm sure you hear some or all of them, maybe you hear more than I hear, but I hear that's an excuse to keep going with business as usual that if people knew or if people heard that we're going to figure out this carbon removal thing, then we can just keep emitting because we'll just get better and better at removal. I've heard that it'll never work at anywhere near the scale that it would need you to matter. I've heard there'll be no market for it other than the government, and that it will be prohibitively expensive relative to other options. I'm sure there're others that I'm missing, but that's kind of a smattering of some of the objections that I've heard. Do those map to the kinds of objections that you've heard about carbon removal? And how do you think about them? I mean it, from our prep call and stuff, it seems like you're really excited about the work that you're doing, so how do you reconcile that with the smart experts that have been working in climate for a long time that are so convinced that carbon removal and pursuit of carbon removal is detrimental to addressing the problem of climate change?
John Dees (14:28):
I think you have to engage the argument on its merits versus the moral hazard question. That's a realistic concern to have. You do a lot of carbon removal, it's not completely out of hand to suggest that if you lean on CDR entirely that you don't address the primary problem, which is that we have to stem the flow of fossil fuel emissions to the atmosphere. And actually, I think that's what's super exciting about where I work is I think we're very cognizant of that. There is a right way to do this and there's a wrong way to do this, and we are trying very much to participate in the conversation of what is the right way to do CDR. I believe it's absolutely necessary that we do it. I think we have a blend of options. We have nature based ways of taking carbon out of the atmosphere. We have engineered ways of taking carbon out of the atmosphere. We have opportunities to do that really poorly and ways that continue inequities and harms that have been caused by other industries in the past. We have opportunities to do this in a way to where the benefits do not accrue to the world as a whole, that accrue to very few. And I think we are in the business of trying to figure out how to do this the right way with the understanding that it needs to be done and that we need to scale it. To address the second point, it is true that a lot of these technologies do not currently exist at scale. A lot of them, there are certainly CDR projects out there, both in the nature based solutions and engineered side that are at a commercial scale, but certainly not at the 10 gigaton scales that we need to get to. But I think it's an exciting time. We're seeing whether it's corporates, governments, individuals starting to realize not only the need for the technology, but also the value proposition of the technology. It's a bit of a goal rush of sorts, which can be kind of a scary and continuous time to make sure that as this is beginning to scale and markets are starting to grow that you get in there and you offer some good guidance about what quality looks like before bad habits get locked in.
Jason Jacobs (16:24):
From your seat though, so it sounds like the moral hazard piece, you feel like it's valid, but can be managed with a thoughtful, concerted approach. And that it has to be because we need the carbon removal. And so it's inevitable that we need it in some form and therefore we should just make sure that we do it the right way and not the wrong way. What about when it comes to the actual having enough scale to matter? There's so many different potential approaches and it's pretty confusing to navigate. And as you said, they're all still at a pretty small scale today relative to where they need to be. What is it that gives you the confidence that they will ultimately get to a scale that matters and how might one go about figuring out which ones can get there and which ones can't?
John Dees (17:21):
Oh, big question. Let's try to take it in parts. So I think there are a lot of particularly engineered technologies that remove carbon from the atmosphere that also produce valuable products. And I think, of course, in the near term it's just like with any technology in its infancy, costs are high, you're still learning just like solar, or you go back a couple of generations, even the oil industry, well, even present day government helps to a certain extent to provide industries with research funding and that type thing to get really good at stuff. So costs come down. I think it's also important to realize that CO2 emissions that are warming the atmosphere are an externality. They haven't been priced and therefore we emit CO2. And it seems as if it's free and it's ultimately going to cost, the cost is going to be born by someone and perhaps one good way of doing this is pricing the CO2 itself, which that in itself gives CDR value proposition. So I think it's going to be a combination of things. I don't have a crystal ball to see how it's going to unfold, but I do see a lot of momentum and advances on things that a few years ago, we're sitting on lab benches and now you're seeing people actually put into practice and I mean, it remains to be seen, but I think it's part of our role to communicate the importance of these technologies to make sure that they're done. If we don't ensure quality in the CDR realm, it is going to falter because if all these technologies are on the front page of the New York Times in five years for causing more harm, good, then there's no real way forward. And what was the second part of the question?
Jason Jacobs (18:50):
How do you pick? Whether it be with an investor hat or just with a climate hat, wanting to know which ones to get behind and remove barriers to where do we put our weight when it comes to because there's all these different approaches-
John Dees (19:04):
Absolutely.
Jason Jacobs (19:05):
I mean, it feels like a mad scientist or something, and it's like, how do I go about making sense of this landscape? And I have a follow-up question, but I'm going to hold that off and address this one first, because it's a big one in itself.
John Dees (19:16):
I'll put my life cycle assessment hat on just because of my training and that's the way I think about things first. I think while there's not a lot of renewable energy yet on the grid, certainly energy intensity of solutions in the near term are prohibitive, it doesn't mean we shouldn't do them, but that's a first brush that there are ways to pull out of the carbon out of the atmosphere that are very energy intensive. There are ways that are less energy intensive. And then secondarily it becomes a unit cost question. How much am I going to pay per ton to get that CO2 out of the atmosphere? A third component of that would be risk, risk of reversal and durability. Durability is going to be a huge question. There are CDR technologies that essentially can remove carbon on geologic time scales. There are other CDR technologies that could be just as valuable, but sort of fit in a different niche that are shorter term on the orders of decades or a hundred years rather than geologic scale. And then not to be forgotten, different technologies have different potential social and environmental impacts aside from their carbon removal component. And at the end of the day, we're going to need a portfolio of solutions. Not every technology is going to work perfectly in every location or in every context, but there are certainly things that we can scale today. There's low hanging fruit that clearly you're seeing, although it's not carbon negative yet the ethanol industry, there are point sources of CO2 that it's a no-brainer that we should be going after this stuff and pumping it underground.
Jason Jacobs (20:48):
The follow-up question that I was going to ask is, when you look at the existing landscape, there's one world where you say, well, the things we have are good to start the creative process, but we need way more different types of carbon removal, we need fresh ideas, we need more creativity, we need innovation, we need to bring in different skill sets and different expertise and different markets and stuff like that. And then there's another that says no, actually the stuff we have is solid, but it just needs to scale. And there's these different barriers to scale that we need to figure out how to move or how to get past one way or another. Where do you feel the biggest bottlenecks are holding back carbon removal overall? Is it the types, more types? Is it scaling what we've got or are there other barriers that I haven't named that are also substantive in your mind?
John Dees (21:45):
I think there are certainly innovative approaches out there that we certainly need, but referencing back to my prior comment, we have good technologies today now that we need to get better at. And on the engineered side, the bottlenecks are things like infrastructure, biomass based pathways. One of the key issues with biomass is that it tends to be regionally constrained. And oftentimes they're particularly what forestry products are in hard to reach places. So the logistics of getting the biomass to a place where you can do something with it tend to be challenging and it sort of limits the scale size of typically of what an optimal biomass facility would be. Other things, CO2 pipeline infrastructure. You see a lot of this in hopefully it gets passed in new inflation bill. The good news we got that mansion was decided to support this new bill. This will support a lot of the infrastructure that will help us to do this. You need pipelines to move CO2 from the places where you're capturing it to get into poor space underground. Certainly you need to get the holes in the ground. So a lot of this when you capture CO2, and if you want to do geologic sequestration, that has to go into what's called a class six well, which in most cases is something that's federally permitted by the EPA. And you can go to the EPA website and you can see the number of applications starting to grow, but the speed at which those things are processed and our contingent on the resources that department has to review and make sure that we're putting this stuff in a safe place. On the other end, we quickly get outside my wheelhouse into the finer details of things like mineralization and DAC.
John Dees (23:22):
We certainly have experts on the Carbon Direct team who know a lot more than I do in that realm, but clearly DAC is an energy intensive solution. We need more renewable electricity and renewable power to support DAC in order for it to truly be a solid carbon removal solution. We're not going to get very far if we're burning natural gas to full CO2 out of the atmosphere. The nature based solution side, again, I'd be wandering into the wheelhouse with some of my colleagues a little bit, but at a 30,000 foot view, I think we're starting to develop solid techniques for figuring out what quality nature based solutions actually look like. And I think that is, I don't know if I'd use the term bottleneck so much as it's pretty clear, you can look in the media in that many nature based solutions. Historically we've checked back up on them now did not deliver on many of both the carbon removal and other benefits that they were supposed to achieve. And I think that's led organizations, not just us, but others to start figuring out what does quality project looked like? How do you monitor report and verify that the carbon removal's taking place? And how do you create appropriate baselines to measure from? And so that's one of the key issues that I've seen in that area in my limited experience with that.
Jason Jacobs (24:38):
Now, in doing these LCAs, how much of this work is purely custom from project to project and technology to technology, and how much of it is actually building a repeatable machine where you're each time you do one of these engagements shipping away at building a higher percentage of the playbooks that can then be reused from project to project. Is there any reuse that's happening today or is it purely just a custom shit show?
John Dees (25:11):
It's all along that spectrum. And in my day-to-day work, I do a lot of bespoke. First, I should probably characterize LCA as best I can as a practice that itself falls along the spectrum of different levels of sophistication and intensity. At one end of the spectrum, you're just trying to red flag problems. So you may do some sort of a first principles' analysis where you're just looking at the energy materials going in, energy materials going out, and they may not be specific to a real world project, you're just trying to get a sense of given top level things that we know about this technology can achieve and what's being claimed. At the other end of the spectrum on say like a deep project diligence, you're typically interacting with the technology provider themselves and getting access to proprietary data to really give this a hard and thorough look.
John Dees (26:03):
Another thing, and I would also add the software team at Carbon Direct is a relatively new addition relative to the time I've been at Carbon Direct that we are increasingly trying to build out automation of some of the repetitive tasks. There's always a point where an expert has to drop in and make decisions. LCA ultimately, it's a systems' analysis and decision to support tool. The goal at least historically has been comparative, I could take product A, I could take product B, I could take service A, I could take service B, and so long as I combine the parameters of the analysis to where I'm making an apple to apples comparison between the two, I should be able to make some relative decision based on whatever it is, the characteristics that I'm measuring about which one would be the best option to go with. There is always uncertainty in LCA. So the number that an LCA spits out is not the answer. That is a key thing to understand about when you see LCA results is that someone is characterized the uncertainty bounds of how much this answer could be off by. So I just sort of wanted to highlight that in that the LCA itself is not going to tell you that this is the exact amount of carbon removal, or this is the exact amount of emissions you get for a thing. And a lot of that's going to really hinge on data quality, and it's going to hinge on a lot of unknowns that oftentimes move dynamically in time.
Jason Jacobs (27:22):
Now, when it comes to the client work that you do as an organization, what are some of the types of clients that might engage you to do in LCA? And what are some of the business drivers that lead them to pull the trigger on an engagement like this one?
John Dees (27:40):
Our most public client, now this is our bread and butter for my time at Carbon Direct when I started was Microsoft. And Microsoft was going through this process of purchasing carbon removals. And we've worked closely with them to understand which responses to their RFP seems promising and tried to highlight where there might be any red flags at risks associated with these projects. And on our end part of proving to ourself that a project, or at least I say proving to ourselves would not be the right term, but being able to estimate the bounds on the risk on whether a project can deliver on what it says is going to deliver on winds up being an internal process of LCA. It's not necessarily that our clients ask us to do an LCA, just in terms of doing our project diligence, it's something we have to do internally to answer for ourselves, whether the carbon claims. Oftentimes, along with the project, we will receive an LCA that's already been done by an outside firm. And for me, sometimes it's just a process of going through what they assumed and walking through the way they did the model and looking for things that could have changed or changes in assumptions that could really change the answer. That's a big part of my work as well.
Jason Jacobs (28:55):
When you think longer term, should this type of work ultimately live in some type of standards or certification body? I mean, there are some standards in certification bodies that exist today, yet, there's still a burning need for the work that you do at Carbon Direct. So why is that? Maybe we'll start there.
John Dees (29:18):
First answer, yes, we need some standardization across the board if for no other reason than for policy purposes. And you're seeing this start to happen. We can quibble one way or the other about, and people very much do argue about the design of different LCA models and approaches to doing LCAs in a policy framework. But that said, in the places where LCA frameworks, the great model that argon national lab produces is a good example because it's used in an actual policy context, it's used in California's low carbon fuel standard program. The EPA uses it as well. The EU has analogs of this, I believe the model they use is called bio grace. And at some point, at least from a policy perspective, and so that we're all speaking the same language and understand where numbers come from, we need homogenous processes where we all know we're doing the accounting the same way, and that we know that all emissions, when you move out of the LCA world into the larger greenhouse gas accounting world, you want to ensure that all emissions are owned by somebody. You're not just losing emissions because they haven't been attributed appropriately. So the reason why is that there are as many approaches to doing an LCA that this is maybe an exaggeration, but there can potentially be as many approaches to doing an LCA as there are LCA practitioners. Because what's out there are guidelines and there are certainly best practices in the field, but there are ultimately decision points that have to be made. One of the first decisions, well, obviously that you'll make in an LCA is the goal in the scope of the LCA. What is it you're trying to answer? And that is going to have something to say about where you draw what we call the system boundary. I might draw a system boundary for a product or process going all the way to the resource extraction all the way to the end of life, where this material or something ends up in a landfill or ends up being recycled.
John Dees (31:10):
I may be interested in a question that's only measuring from the gate of the plant that's doing the production to the gate where it leaves production. And so the question a lot of times is going to inform decisions that you make that are really left up to the practitioner about how you're going to do the analysis. Another example of this is you may have a process, I'll use ethanol, the ethanol industry as something that I'm more familiar with. Ethanol refine, just produce ethanol. They also spit out a product called dried distillers grains in solids out the other side of the plant that is also a product that is used for animal feed. And many of them also produce corn syrup or corn oil as a third product. And then, so you end up with a decision point of how do I attribute the emissions between the ethanol and the feed and the different products that are coming out the other end of this process. And you could choose to do that according to the market value of the products coming out the other side, you could do it according to the energy content. Long story short, just pointing out that there are all these places where an LCA practitioner has to make decisions. And those decisions often informed by the question that's being asked, which means that any two LCAs, unless you really dive in and see what was assumed, they're not cross comparable. Plus you have things that change regionally, like your electricity in one, region's going to have a different carbon intensity than in another region. It can get quite complicated. And I think we're moving towards the place and increasingly need to move towards the place where these things are standardized so that we can at least we're all speaking the same language. And then we can quibble about what needs to be changed.
Jason Jacobs (32:43):
It almost reminds me of, I'm trying to think of the right analogy, but let's say a car dealership where I'm trading my car and the value that they're going to give to my car might vary widely depending on if Joe's working or Tim's working or Tina is working because they all have a different lens through which to value that vehicle. Is that the state of the market today that it's like, well, Carbon Direct, they tend to do it this way. Or maybe it's even just different members of your team with different philosophies versus this LCA firm versus that LCA firm. Is it the wild west? Is it all over the map is there's so much that's subjective or is this stuff capable of being audited or instilling any kind of rigor or consistency in any way?
John Dees (33:25):
Of course, I think it's something that can be audited. I would point out that LCAs lives in multiple worlds. My introduction to LCA was academic and working with the national labs, which is how a lot of the work I've done is involved the Greek model. And there are also established life cycle assessment firms out there in the world. Everybody's basically following ISO standards and there are stages of the LCA process that different LCA practitioners might wind up with a different answer. You should be able to go to any life cycle assessment report and all the information should be there to understand in terms of data quality and the time period of the data, the assumptions that were made to untangle how they got to the number that they did. Where this falls apart is that many LCAs for products are based on proprietary information and all you may actually ever see is that company that's producing the product just presents you with a certificate that says we hired a third-party to do an LCA. That third-party likely also hired a third-party to double-check their work. There are best practices in place to try to get to quality, but in a certain sense, yes, it is the wild west because you really have to know what you're looking at and you have to dive into these reports to understand why the answer is different.
Jason Jacobs (34:46):
What type of tooling might one use when they're doing this LCA work? And that's a general question. So it could be software, it could be measurement devices, it could be different collaboration tools. What's the tooling portfolio that you rely on, and where are the gaps/opportunities for those out there listening, thinking, what could my contribution be to the cause? What do you wish existed from a tooling standpoint that doesn't exist today or say it another way, where are the blind spots?
John Dees (35:16):
In the public sphere, there are, I'll make a distinction between life cycle assessment models and lifecycle assessment as a practice, but there are certainly lifecycle assessment models in the public sphere that I mentioned previously, the greet model is primarily focused on transportation. EU has the bio grace and bio grace two model. There's open source LCA software as a software called open LCA. And nations, NGOs, private sector, are all working very hard to create LCA repositories of publicly available data that can be used to do LCA analysis in something like open LCA. That said, time is not your friend in LCA. Things changed so fast. So like the emissions' intensity of a mega joule of electricity is very different now than it was five years ago. Similarly, processes get more efficient in manufacturing. And so the carbon intensity of a material is going to change over time. And so one of the problems that you run into in the public side is that the same amount of money isn't there to keep these data sets constantly updated in the way that a commercial offering can do. And so there are softwares out there on the commercial side, things like Eco Invent, which is an LCA database, Semipro and Gabby. These are more like the enterprise solutions where they're constantly updating their data and have lots of tools built in to make it easy to produce a life cycle assessment report. But in terms of how do we bring this all together, it's ultimately a policy question. A lot of the decisions that you wind up making in LCA, whether intended or not, when you say what's the right way to do the analysis, there's something normative implied by that. Some of the choices that you make, particularly if you're trying to build an LCA model that is generalizable to any business of a type in the economy, it's going to advantage and disadvantage certain ways of producing things. And so ultimately that guidance about what is the right way to do this accounting is a decision that has to be made at a political level. And I think that's the only way you get homogeneity between approaches.
Jason Jacobs (37:21):
And it sounds like even as that starts to manifest, it might be happening at a national level, but there is no international standards body emerging.
John Dees (37:32):
Yeah. I mean, ISO, this is certainly the fallback. It's the starting point for everything. The Greenhouse Gas Protocol and World Resources Institute have published a lot of standardization and best practices materials. In the carbon capture and utilization space. The Global CO2 Initiative, university of Michigan has published reports on best practices and approaches for carbon capture and utilization LCA. And there's a convergence. You certainly see they reference each other, but we're just still a long way off from getting there. And I think ultimately what government and countries and nations have fallen back to is bringing in these big lifecycle assessment teams from national labs, like say Argon and creating default LCA values for things, and then creating a process by which if you think your carbon intensity is better than the default, then creating a process by which you can go through and present your own LCA evidence as to why you think the default value doesn't apply to what you do. It's a huge need. It is a huge need, both within nations and between nations to sort of get on the same page about how we do this stuff.
Jason Jacobs (38:40):
How different is this work in regards to stage from say a small project or a small company that's pretty new versus a big company with a long track record, for example, and then same thing when it comes to sector to sector or technology to technology? And one of the reasons I ask is that I'm curious about generals versus specialists when you think about this work and which one might make more sense if there even is such a thing as more sense.
John Dees (39:11):
It's tricky in the sense that I have a solid background in life cycle assessment and I have a background in biomass utilization, which is where I tend to apply that. So while I can tell you the proper approach or a list of proper approaches to go about doing LCAs across many industries and sectors, you need people with subject matter expertise in those sectors to do an LCA appropriately. And when you wind up over in something like the chemical sector or say semiconductors or something like that, where they have extremely complicated supply chains, LCA becomes the amount of work that's required to do. The LCA of a product can expand by orders of magnitude, relative to other industries. A lot of times we fall back on these aggregate generalizable tools. There's something called economic input output LCA, which essentially tries to generate emissions factors for dollars spent in different sectors of the economy. And certainly that's how these more complex processes, you've tried to model the complex upstream using these general tools and then you try to focus in really narrow on the things that are actually happening inside the plant. But that said, there's an enormous difference in scale of company and type of technology and the amount of effort and just people hours and data required to do a proper LCA. Biomass can get complicated, but it's relatively simple compared to some other sectors. And also focusing depends on what you're looking at too. My work tends to focus on carbon while qualitatively considering other things, but obviously there's more to the life cycle impact of a product than just its carbon emissions.
Jason Jacobs (40:48):
What's the incentive for a company to care about the accuracy of their LCA versus just rubber stamping that it was done and that the numbers look good?
John Dees (40:57):
Well, on one hand, as policies I think EU is a good place to look where a lot of this stuff, the criteria for being able to qualify under different EU policy programs are tied to doing LCAs and carbon footprinting exercises and feed stock acquisition, and all these types of things that fit within the framework of the policy that they've created. So it doesn't matter if you go out and get a third-party firm to do your LCA, ultimately you have to do it the way the policy says. So that's one incentive, but certainly, a lot of firms do LCA just to be able to and I'm not implying any ill intent, but they're trying to give their customers [inaudible 00:41:38] on the package to let them know that this is an environmentally responsible product, or it's not. That said, in reality, it would be very hard for a customer or consumer to cross compare an LCA number on one product versus another, because they were likely done by different firms. Did I hit on what you were going after there?
Jason Jacobs (41:56):
I think so. I mean, relatively, if you look at B Corp, for example, the certification body there is a non-profit. So what about for-profit LCA work versus nonprofit? I mean, some of the existing certification bodies, Vera and others are nonprofits, what are the pros and cons of a for-profit versus nonprofit approach?
John Dees (42:16):
As I mentioned before, the for-profit houses, because this is their business model tend to have access to higher quality data. They're also responding probably faster in real time to new research, new approaches, new best practices. And they really in many ways automate the process of producing the final product, which would be the LCA report. Those are the clear advantages they have reputation to uphold. I would make the distinction that although I am an LCA practitioner and I do this work at Carbon Direct, there are firms that this is all they do. And there is a certain standardization that comes with that territory time of having been doing it for a long time. The public sector stuff though, I think is equally as important, just because I can't afford to go, hey, 30, 50 grand or more, we'll see a single WELC depending on how in depth it's not unheard of for single analysis to get up to $100,000, there is a need for public data to be able to approximate and do some first pass LCA for products that does not carry all that overhead. I think increasingly as this becomes more of a policy oriented practice where having an LCA of your product or a carbon footprint of your business becomes a policy need. There'll be more weight probably either on the public tools or a deference to certain private sector actors.
Jason Jacobs (43:42):
Let's say there's a new carbon removal company getting off the ground. Is there a stage that's too early to be thinking about and resourcing to LCAs or do you think they should be thinking about and resourcing to doing this work from day zero?
John Dees (43:57):
From day zero. So I would think one of the things that at least I've found in our work is that companies, firms, or even non-profits and public entities are at different stages along this road. You need data to be able to do a proper LCA or to do a carbon footprint, say for a business, I would make the distinction between two things. There's some overlap, but LCA and GHG accounting for a company are two different practices. And in order to do that well, you have to be holding on to certain types of data, energy use, travel receipts, and some companies have had this in larger corporate firms have had these types of things in place for years and they're automated and they can just press a button and they can give you everything you need. Whereas a mom and pop shop, for lack of a better term, or a smaller start just given personnel may, really might struggle to pull all that stuff together. And I think if you have an eye on that from the start that this is something you're going to want to be part of your product offering or value add that it's going to be a lot easier to figure out how to capture that data from day one than it will be five, 10 years in to try to go back and figure out what's going on.
Jason Jacobs (45:06):
And relatedly, as companies scale, if you look at legal, for example, in the earliest days, you work with a law firm, as you scale, you keep working with the law firm, but if you're doing the same repeatable work again and again, at a certain point, it makes sense to bring some of that skillset in-house so that not everything is going to be billable. Is there a similar evolution here? And if so, what types of skill sets are you seeing clients bring in-house? Or might you surmise that they would bring in-house more as their projects and the category continue to evolve?
John Dees (45:36):
I'm certainly familiar with clients who have, particularly the big corporates that have LCA expertise in-house, normally their larger sustainability department and that ultimately it can be necessary for some firms where you're really dealing with a lot of proprietary information, it's just simpler to have that capacity in-house. As a repeatable process, I think you're exactly right. That said, it's not clear to me that every product will repeat this. Unlike keeping track of your emissions for something like the greenhouse gas protocol, which is something you would do every year. For products, particularly if you're a company that produces many, many, many things, the likelihood that you're actually going to do an LCA on each of your products on an annual basis is really small. But you may perhaps do an LCA on a product this year, do an LCA on a new product next year. And after a 10 year cycle, you get back to your original product again and update your stuff. I think there's a lot of room to be able to build in-house models that simplify this type of stuff. And I do think we're seeing a transition away from folks who do a lot of what I do, which is very high touch working in Excel spreadsheets, building my own custom proprietary in-house models versus a scalable solution, which is certainly what some of the commercial LCA companies provide.
Jason Jacobs (46:57):
I want to pick up on something that you mentioned before about how comparing one product to another is apples to oranges because different firms might have done the LCA, if I heard that right. Does that essentially mean that the only way to truly get value would be like in the Microsoft's example, I get it. They're bringing in you to do a LCA for all the different projects that got submitted and then there's consistency because it's you doing the work across all? If it isn't that, then is it basically a worthless exercise?
John Dees (47:30):
I don't think it's a worthless exercise, but I would just point out that we're producing two different products. So someone who produces an LCA for an environmental disclosure or for branding exercise, or what have you, are typically in a report a number on the package, that is always going to be somewhat misleading. If it's for policy, if they follow divided by all of the rules associated with the policy, like under the LCFS, that number is typically associated with really well understood processes that they've made it under a particular bar to qualify and to participate in a program. I'm doing something very different in the sense that I'm using the same methodologies, but I'm not aiming at a number, I'm aiming to understand the uncertainty bounds and the things that you could move in analyzing the system that might tell you how that number could be very, very far off. And obviously, the tighter you can pull down that uncertainty, the more confident you're going to be in a technology or a project, and at least in my day-to-day work, which is very different, I think, than what a lot of LCA firms that are producing for product reasons, I'm just looking for all the places that can go wrong. And that's the type of insight that I'm providing to clients. Hopefully, it's carbon negative, but do the uncertainty bars put you in a place where this could actually be horrible if you just tweaked one little knob, like if your feed stock's coming from this place and not from this other place? Which I think to a certain degree is a very different exercise than what a lot of LCA practices is aimed at.
Jason Jacobs (49:04):
And if you could wave a magic wand that would help you do higher quality work in a more repeatable way, what would you wave it and have come about? I guess, what would you change and how would you change it?
John Dees (49:16):
For starters, publicly available data sets? I would love to see those increase exponentially that requires funding. Certainly, there's a lot of good work happening in that direction. You can go to the federal LCA commons is one public source for LCA data where databases have been uploaded, but there's a huge need for data.
Jason Jacobs (49:34):
For what kinds of data do you not have that it would be helpful to get access to?
John Dees (49:40):
I would say chemicals and polymers industries are notoriously complicated and complex. You can get access to those data sets. And a lot of the commercial packages, there may be a few public ones out there, but finding something that's up to date, and that is high quality is a difficult thing to get your hands on. And I would say that I haven't looked through that public repository in quite a while. I tend to sift through different sets of data sources than that these days. But as I remembered, it was really spotty. You would find data sets of agriculture sector and Europe and emissions factors associated with those things. But the data set might be 10 years old. I think it's really across the board, but particularly really complex complicated industries with complicated supply chains, you're almost stuck with having to go to a commercial data source to get that data.
Jason Jacobs (50:28):
Well, great. Well, this was such a wide ranging discussion. John, is there anything I didn't ask that I should have or any parting words for listeners?
John Dees (50:34):
I think we covered all the bases. This was super interesting and informative, and I hope folks will swing over to the Carbon Direct website and take a look at what we're up to. There's a lot of cool stuff going on and we're trying to be a voice in the space. So hopefully, even beyond the things that we're offering clients, we're trying to produce public thought pieces and this type of thing on important topics, and I'd encourage people to go check those out.
Jason Jacobs (50:57):
Sounds great. Well, thanks again, John, and excited for this to ship.
John Dees (51:01):
Thanks, Jason. It was great talking to you.
Jason Jacobs (51:03):
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 make me say that. Thank you.
