Episode 124: Nicolas Pinkowski, Nitricity
Today's guest is Nicolas Pinkowski, Co-Founder of Nitricity.
Nicholas is a PhD student at Stanford in mechanical engineering, where he's focused on studying energy systems. He's also the co-founder of Nitricity, which produces ready-to-use nitrogen that uses only air, water and renewable electricity. Nicolas and his team recently won the MIT Clean Energy prize, at which I was a judge. One of the things the competition grants to the winner, in addition to money (which I'm sure he and the team care a lot more about), is to join me on an episode of the MCJ podcast.
We cover a lot in this episode, including how Nitricity came to be, the impetus for its founding, progress made to date, and some of the twists and turns along the way. We also discuss the company’s longterm vision and what's coming next. We also touch upon the experience of starting a company within an academic environment and the pros and cons of doing so. Finally, we delve into what society can do to foster more of this type of innovation, that holds promise of delivering both impact and profit.
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.
In today's episode, we cover:
What is Nitricity?
The background of the team and how they came to work together.
How traditional fertilizers contributes to GHG emissions.
How Nitricity arrived at the problem and discovered a solution.
Experience with taking an entrepreneurial class and how it inspired Nitricity.
The skills needed in developing their prototype.
Pros and cons of prototyping on the farm versus in the lab.
Nitricity’s pitch and value proposition for the farmer.
Nitricity’s business model, expenditures and dependencies.
The company’s financing efforts.
Nitricity’s product vision moving forward.
Links to topics discussed in this episode:
Check out another interview with Nico on the MIT Energy Initiative podcast
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Jason Jacobs: Hey everyone, Jason here. Before we get going, I just wanted to take a moment to give a quick shout out to the new paid membership option that we recently rolled out. This option is meant for people that have been getting value from the podcast and want to enable us to keep producing it in a more sustained way. It's also for people that want extra stuff such as bonus content, a Slack room that's vibrant and filled with people tackling climate change from a wide range of backgrounds and perspectives. As well as a host of programming and events that get organized in the Slack room. We also have a virtual town hall once a month where you can get a preview of what's to come and provide feedback and input on our direction. We'll be adding more membership benefits over time. If you wanna learn more, just go to the website, myclimatejourney.co. And if you're already a member, thank you so much for your support. 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.
Today's guest is Nicolas Pinkowski, co-founder of Nitricity. Nicholas is a PhD student at Stanford in mechanical engineering where he's studying energy systems. He's also the co-founder of Nitricity, which produces ready to use nitrogen with only air, water and renewable electricity. Nicolas and his team recently won the MIT Clean Energy prize. I was a judge in that competition and one of the things that the winner gets, in addition to money, which I'm sure he and the team care a lot more about, they also get an episode on MCJ, so here we are. We cover a lot in this episode including how Nitricity came to be, when and why it came to be. Their progress to date, some of the twists and turns along the way. Their long vision for the company and what's coming next. And we also talk about just starting a company in general within the confines of academia, the pros and cons of that approach. And what we can do as a society to foster more of this type of innovation that can have a big impact on the world and also build a big profitable company as well.
Nicolas, welcome to the show.
Nicolas Pinkowski: Thank you very much. Good to be here.
Jason Jacobs: Good to have you. So I came across you guys once before because I was actually a judge in the MIT Clean Energy Competition and little MCJ was one of the... uh, you being a guest on the show was one of the prizes for the winners. And you guys were the winners and that's a pretty prestigious event so it's an honor to talk to you live here.
Nicolas Pinkowski: Yeah, you know, I remember you ask a question to us as part of the judging panel. So thank you very much for judging us and it was a surprise that we won that but it's gonna be really impactful for our company and the climate.
Jason Jacobs: Well I gave you a few softballs as part of the judging, I saved all the- all the real hard hitting questions for today.
Nicolas Pinkowski: Uh-oh.
Jason Jacobs: Nah, I'm just kidding. So why don't we just take things from the top. I mean what is Nitricity?
Nicolas Pinkowski: Nitricity is a fertilizer company. We make nitrogen and potassium and prosperous fertilizer and acid using air, water and renewable electricity.
Jason Jacobs: Mm-hmm [affirmative]. And how does one get into building a fertilizer company? How did this all come to be?
Nicolas Pinkowski: So we're a group of students at Stanford University, three, PhD students and one postdoc. Many of our team has been... is doing a PhD on this subject matter, very similar aspects of it. And for the past three years, we've been working together on how to de-carbonize the fertilizer landscape. There's considerable omissions from the products of nitrogen fertilizer and the Haber-Bosch process today. There's only 150 to 200 of these factories in the word, but there's four billion acres of farmland where that fertilizer needs to get to, so there's trucking and distribution emissions and product loss. And then, you know, when it gets to the farm, the focus is on an optimized supply chain instead of what type of nitrogen is best for the soil. And so oftentimes, we're putting the wrong type of nitrogen in the soil and it leads to a lot of run-off and greenhouse gas emissions in the form of N2O.
Jason Jacobs: Now, did you start with the problem space and then go about finding solutions or did you come up with a solution and then figure out the best place to apply it? Or I guess there's a option C, which is something different than either of those.
Nicolas Pinkowski: So we're very top down. We've wanted to make nitrogen fertilizer using air, water and sunshine or wind for three years. And we've looked at nearly 30 different technologies from around the world that could do this. And we've down selected and built prototypes and had very challenging pivots when we've needed to, all in the pursuit of one that makes cost sense for a farm. And we think we found one and have installed a system on a farm in California today.
Jason Jacobs: And so did this all happen in the context of academia?
Nicolas Pinkowski: So we- it started in the context of two entrepreneurship classes at Stanford University led by David Danielson and Joel Moxley, called Stanford Energy Ventures. This is a great-
Jason Jacobs: I know the class well, by the way.
Nicolas Pinkowski: Oh yeah, this is a really great class.
Jason Jacobs: Yeah.
Nicolas Pinkowski: I just watched the final presentations for the new cohort. There's a really great one on cement there and how to decarbonize that.
Jason Jacobs: Nice.
Nicolas Pinkowski: But it started in this program and then we kept going. And, you know, eventually we won. Drove down to Los Angeles, give a pitch and won $5000, which was huge for us when we started, we incorporated a company two years ago.
Jason Jacobs: And in terms of timing, when did you graduate from the program?
Nicolas Pinkowski: So we graduated from Stanford Energy Ventures about two years ago. I'm still a PhD student. I'm the only one still in school of the team. Everyone is now full-time Nitricity, and there's four of us and one intern whose really great working with us.
Jason Jacobs: Got it. So the other- the other three of you persuaded straight from the degree program and then you stuck around to continue your PhD while starting the company in parallel?
Nicolas Pinkowski: Something like that. We've been working on it as the side project as we work on our PhDs for the past three years. During the course of this, folks have graduated, one postdoc position is now over. And so now there's three folks who are full-time Nitricity and, uh, I'm full-time Nitricity as well. I- I also am concluding my PhD.
Jason Jacobs: Got it. And I always wonder, I mean heading into to a course like that where the goal is new venture creation, did you go in planning to start a company or was it more like this was an academic exercise that ended up just kind of gradually building it into something you guys took more seriously as you realized it had legs?
Nicolas Pinkowski: We went in interested in- in the challenge, largely in a curiosity point of view. So academic, you could say, it would be really great if we could find something that could decarbonize this big industry. And then, you know, the class was catered towards creating new companies and helping students who are interested in that kind of thing. And personally, that's part of the reason why I found myself at Stanford as opposed to many other schools in the United States, 'cause it has a rich community of entrepreneurship. So it was academic, but, you know, very much with the intention that if something could be found, it would be a great new company.
Jason Jacobs: And, I mean was there kind of a- a hit your head in the shower moment or when did the switch flip from project to company?
Nicolas Pinkowski: Oh [laughs], not so much a moment where we realized we had it. We thought we've had it and then realized that we didn't about 20 times [laughs]. I think the big catalyst, uh, form a company was when we realize the art of the possible in this space. There's so many new technologies out there, the fertilizer landscape and marketplace is immensely complex and we can't wait to decarbonize it, we need to start now. And so, you know, with those combinations of factors, we thought the timing was right to start a company in September, 2018 after we won some funding to do so.
Jason Jacobs: And that was through some type of business plan competition?
Nicolas Pinkowski: Yeah, the Flow Competition at the Transformational Idea Award competition at Cal Tech.
Jason Jacobs: Cool. And so in terms of these- the 20 different times that you mentioned, I mean did you guys have the skills going in to do this experimentation and do these cycles to- to uncover the right thing? Or did you have to lean on a bunch of external resources during this quest?
Nicolas Pinkowski: Well, [laughs], for a lot of things, we- we didn't have the skills right away and we had to learn them as we tried to construct a prototype. For most of the technologies we were looking at, it relied up on our group... our teams, you know, instead of core expertise, which was electrochemistry and electricity to X through photolysis type stuff. And so, you know, we started with those and those are the technological candidates that we looked at first because that was in our domain. But then we didn't limit ourselves to that and we looked at technologies out of the box and that we had to learn and develop new skills to be able to analyze it.
Jason Jacobs: And do you feel like for this kind of company, starting from zero and entering where you did where you top down as you described, how was it starting in the- in the context of an academic environment, what were the advantages of doing so and what were the disadvantages?
Nicolas Pinkowski: That's a great question. The- the advantages are that it's a lot easier to build a prototype in a lab than it is on a farm and so you can go pretty fast in a small scale innovations. The disadvantages are, you're so far from... you're so disconnected from the customer and the use case that oftentimes you can get fixated on nitrogen fixation technologies that are necessarily in the right direction. The big turning point for us was when we got ourselves down to Fresno instead of the Bay Area and started pitching and talking to farmers and growers down here and actually started iterating hardware on the farms. And that's when we had a big breakthrough 'cause then we focused directly on the use case and on the farms and not so much the text books and the factories and so that helped a lot.
Jason Jacobs: And I'd love to double-click on that, so what is it about the textbooks versus the farms that sent you in the wrong direction or inhibited you from hitting the mark?
Nicolas Pinkowski: Yeah, so for example, and you hear folks talk about in academic settings and many new companies, talk about fixating nitrogen fertilizer.
Jason Jacobs: Mm-hmm [affirmative].
Nicolas Pinkowski: Everyone says, "Let's make ammonia." Because that's how it's made today, ammonia's made in these big factories and then, like, how can we make ammonia better? But ammonia's very different than fertilizer. Ammonia is not great fertilizer. You can inject it as such and in doing so, you emit a lot of toxic gases and you get a lot of waste. Fertilizer, and plants have developed over the past billions years to use nitrate base fertilizer. And so we came to Central Valley exploring different types of fertilizers and different types of use cases and discovered that being fixated on ammonia and- and proving how these factories are made is very different from make a company that's trying to decarbonize fertilizer production. And so now actually, we're offering, based on our current contract, we're offering a nitrate based fertilizer that we make with air, water and electricity. You never wanna ship this, but we don't have to ship it 'cause we make it right on the farm. But this was a huge realization for us as we got, you know, on the soil [crosstalk 00:10:57].
Jason Jacobs: So it was by talking to the farmers that you realized that a nitrate based solution was better for them than ammonia?
Nicolas Pinkowski: Yeah, well, we gave them a couple options. We said, "Sir, we can make ammonia if you really want it. Or for cheap, we can make calcium nitrate." And he said, "Wow, can- you can offer calcium nitrate? That's much better than ammonia. I don't really know what we would've done with ammonia anyways." [laughs]. So that was a huge realization when we had those conversations.
Jason Jacobs: So how were they doing it before Nitricity comes along?
Nicolas Pinkowski: So before we came along, so California imports 100% of it's nitrogen from overseas. And so I think they're getting it from Trinidad and Tobago or Canada right now. So ammonia is being shipped in tankers from halfway across the world as produced in factories that are harming the same environment that farmers are seeking to cultivate. It gets to the port of Stockton California, and it's stored in massive ammonia tanks. It's then distributed to various different chemical companies that convert this fertilizer into types that farmers actually wanna use in Central Valley.
Jason Jacobs: Mm-hmm [affirmative].
Nicolas Pinkowski: And then UAN-32 is a urea ammonium nitrate solution, 32% by mass nitrogen, eventually is the most common one, the lowest cost option in Central Valley right now. And that gets trucked to various farms. And I saw one at a irrigation head last weekend and the farmers will inject that into their irrigation stream. And so that's the process where it comes today.
Jason Jacobs: And what I'm hearing from you is that one key difference, and correct me if I'm wrong, is that verus getting shipped from far away parts of the world, you're producing it for them right on site, correct?
Nicolas Pinkowski: Yes, sir. We turn air, water and sunshine into fertilizer right at the irrigation head.
Jason Jacobs: Uh-huh. What about the product that they're getting itself, how does that stack up to what they're getting shipped from these far away places?
Nicolas Pinkowski: Of course I'm biased, but we've gotten great feedback that it's actually more aligned with what they would want. For example, currently, UAN-32 or calcium ammonium nitrate that's commonly used in California. We're offering a farm calcium nitrate and this is something that they've used in the past and they like just as much. And so this is- it was a drop-in alternative for them here.
Jason Jacobs: So tell me the pitch. If I'm a farmer and you are looking to do business with me, why should I work with you relative to the things I'm - I'm doing today?
Nicolas Pinkowski: Yeah [laughs]. So it comes down to, so fertilizer today I think is done backwards. And so the pitch to the farmer starts with just listening and asking them about their fertilizer demands. And it doesn't just stop at nitrogen, it's only one component. You ask and you listen. You go and you- you tell them that you're curious and you listen to how they apply nitrogen, phosphorus, potassium and how they manage pH. And then you ask them, you know, how do they optimize it and what would they look for? And then you say, "So we produce a system that can sit under the solar panel or plugs into the grid and it can make a variety of different nitrogen fertilizers at any pH. And we'll give you the reins, we'll give you the control panel. And you can make and inject whatever type- whatever form out of these seven options at whatever pH you'd like at any moment you'd like." And we ask them if they think that would be useful and how they may optimize that and, you know, what components of the product they think would be particularly valuable.
And so they get really excited at that point because they're- you're totally empowered. You don't have to call a distributor to get fertilizer ordered. You don't have to go to irrigation head to inject a type. You don't have to calculate the price per acre as a function of the different types of fertilizer they're applying today. It simplifies the process. It gives them a dashboard and empowers them to do it themselves.
Jason Jacobs: And you mentioned Fresno, so where are you guys at from a delivery standpoint? How many farms are you delivering to and are they all based in Fresno? Or are they located in other places as well?
Nicolas Pinkowski: We're on our first farm in Fresno California now.
Jason Jacobs: Mm-hmm [affirmative].
Nicolas Pinkowski: It's at the Center for Irrigation and Technology at Fresno California. We sized a system for only one acre and we have a much smaller plot than that even and it's sub-surfaced irrigated processing tomatoes. And so we have a- an R&B contract with this irrigation center. And it's already making nitrogen and storing it every day when the sun rises.it sends data to the cloud and then, you know, we monitor it and are working on it. And so next year, we wanna get on a 70 acre commercial scale plot in Central Valley, and so that's something we're really excited about.
Jason Jacobs: How do you think about adjustable market? How many farms are there in the world and how many of those realistically can you serve? And what are the criteria that makes a farm a good prospect for you?
Nicolas Pinkowski: Yeah, so [laughs], Justin, California is a great beachhead for us and, you know, we're starting in higher valuer fertilizer markets. So we're looking for farmers that use irrigation and [inaudible 00:15:23] feritgate, apply fertilizer through the irrigation system. And we're looking for farmers that have a- have cash props, and so they care more about the specialty type of fertilizer. Or we're looking for farmers who have a hair on fire pH soil challenge. And so for either of those two farms, we can replace conventional fertilizer and at a better cost. And so, you know, we can provide a direct value add. We're also trying to certify our fertilizer as organic. And organic fertilizer today is impossibly expensive and so that would be a big game-changer for the company.
Jason Jacobs: Why does organic matter?
Nicolas Pinkowski: So the cost per pound of nitrogen, of conventional fertilizer in Central Valley is about 50 cents or 40 cents. The cost per pound of nitrogen in organic fertilizer is $5.00. And so, you know, oftentimes, it's too expensive to apply enough nitrogen-
Jason Jacobs: But why does it matter... why do I care as a farmer if I use organic versus not?
Nicolas Pinkowski: Oh, so there's much higher margins if you can produce a organic product. But the yield that you can get is sometimes lower because you can't apply as much low cost nitrogen.
Jason Jacobs: Uh-huh. Well your margins are better, is that what you mean?
Nicolas Pinkowski: No, if you can product an organic tomato as opposed to a nor- a nor- a conventional tomato, you can sell that tomato for a much higher price. So that's what farmers are looking-
Jason Jacobs: Oh, so they can say it was produced organically and they get the brand halo and, I mean presumably a better product. Okay, and when you go to scale from the one farm that you're on to two farms, five farms, 10 farms, 100 farms, 1000 farms, how do you think about staging and what are the big challenges as you scale and specifically for the next phase as well?
Nicolas Pinkowski: Yeah, a lot of farms we've spoken to in Central Valley, they'll have 9000 acres or 5000 acres and they'll test a new technology out on 50 acres. But, you know, it's really important for us that every contract that we have right now is executed very well such that when we leave, the farmer wants to convert their entire farm to Nitricity nitrogen and other fertilizer. That's really important for us. So, you know, we wanna find one to three commercial farms in California and get a test plot next year and have is- all of those convert and applied across much more of their acreage in the subsequent year. So we need it... it becomes really personal. We need to give the growers exactly what they ask for and product a product that is very good.
Jason Jacobs: Are you actually selling them the nitrogen itself or are you selling them essentially the gear that they need to produce it on their own land?
Nicolas Pinkowski: So farmers, whatever they buy in terms of... It's our understanding that growers, however they buy nitrogen fertilizer or any other types of fertilizers, they convert to an internal budgetary sheet that's in the form of dollars per acres per year. So that how they normalize all their different inputs coming into this budget sheet. So we charge dollars per acre per year and we'll provide up to, you know, 200 pounds of nitrogen per year and X amount of phosphorous and potassium, we're still working on that, and at pH that they would like, uh, [inaudible 00:18:20] form that their internal spreadsheets on and we'll sell it-
Jason Jacobs: Do you put the equipment on site, but you own it and manage it? Is that what I'm hearing?
Nicolas Pinkowski: We organize the finance and installation of nitrogen production assets and sell subscriptions in the form of dollars per acres per year to the farm.
Jason Jacobs: Got it. So the capital outlay for the equipment and the ownership of the equipment, is that you or is that the farmer?
Nicolas Pinkowski: That's us. So we really have to hustle on the backend to make it as easy as possible for the grower. The grower has enough to worry about to then to service these and install and own these pieces of equipment.
Jason Jacobs: Got it. And is there any risks that you're gonna put this equipment on site and for whatever reason not be able to deliver through either factors within or outside of your control?
Nicolas Pinkowski: Whenever you have a new technology, there's always that- that risk. No one has ever done this type of on farm production and solution before. And so, you know, that risk definitely exists and we really have to hustle to make sure we can execute on these contracts. We're taking it step by step. That's why we're going on... we're on one research plot this year, one commercial test plot next year and expand beyond that. And that'll be a way that we can mitigate those risks and maintain good relationships.
Jason Jacobs: And what are you most worried about at the moment? What's keeping you up at night?
Nicolas Pinkowski: Oh, [laughs], there's a big different between building something in a lab and building it on the farm. You know, right now, it's about 110 degrees on the field in Fresno and we're optimizing our system. And so we're out there working on it every single day. So what's keeping me up at night is the bits and bobs and, you know, how we can optimize this and how we can perfect this and that's what we're focused on right now.
Jason Jacobs: Mm-hmm [affirmative]. And as you think about scaling, so I would imagine given then... Well, I guess I didn't ask, but what kind of equipment costs are we talking about? Like how much do you guys typically have to put up in cash for a single customer engagement?
Nicolas Pinkowski: So it all depends on where the electricity comes from.
Jason Jacobs: Mm-hmm [affirmative].
Nicolas Pinkowski: Our system that sits underneath the solar panel's and fixes nitrogen is very low cost and that's part of why it makes sense and why we chose it out of all the different technologies we looked at. That this system is- it's got low in capital costs and so it can operate intermittently. Then the question becomes, do we have to pay for solar panels to be put down or not? And so if we have to also pay for a solar array, we have to work with the bank to get a loan on the solar.
Jason Jacobs: And is there any cap on what the equipment can produce since its using presumably it sounds like all natural resource like from the air and water and things like that. Are there- are there any... like are there chemical dependencies that you need to access to certain chemicals or things like that or is all of that mitigated by the way that you're delivering this product?
Nicolas Pinkowski: So right now, to give you a sense, there is a cap and it's based on, you know, how much sun there is per day. But, uh, we could also plug it in to the grid and pretty much that cap is gone. But right now, the system turns on every morning when the sun hit- crests the horizon and hits the panels, the system turns on. And then at the end of the day, it turns off. Or if a cloud goes over the sun for an extended period of time, it turns off. And so, you know, we size this system, we have to oversize the system such that it can work intermittently. We have to estimate, based on the profile and where a farm is located that oversize factor, that we need to do such that it can operate intermittently effectively.
Jason Jacobs: Uh-huh, so is the a very capital intensive business to scale?
Nicolas Pinkowski: If we have to own all of the solar panels, it will be. But if we can get, uh, support and financing, the solar panels, for which our system sits underneath, it shouldn't be. The technology we chose can work with intermittent electricity and is not to expensive.
Jason Jacobs: And how do you think about source of capital? So would it be kind of a little bit of equity capital to get the team and the initial product in place. And then when it comes to really scaling, that would come through some form of [inaudible 00:21:49] or product finance?
Nicolas Pinkowski: Yeah, great question. So to get this on its feet until the point where we have enough fertilizer contracts and subscriptions where it can- it has its own momentum, we are raising some equity finance. We're in the middle of a fundraising round. It's going very well and I'm very pleased about this. And things like the MIT Clean Energy prize are hugely influential to helping us. And we're [inaudible 00:22:08] a bunch of government grants, about one... it feels like one ever week lately. And so that's how we're thinking about capital right now. We are hoping to get project finance or effectively loans once we have enough assets that we can leverage those as collateral. That will be used for solar panels so we don't have to own those.
Jason Jacobs: Got it. And so what I've heard in other kinds of businesses of- of this nature, there's the upfront to get going, then there's the project finance to scale, but you've got this- there's different words for it, it's like first plant risk, how do you fund the first of the kind or that kind of thing. Is that a relevant concern for this type of business or is it kind of a smoother progression than that?
Nicolas Pinkowski: That's a great question. And so, you know, these systems, we've designed them as such and they need to last for multiple years. And, you know, there will be a cash pinch upfront such that we can organize the financing of the hardware to install it. So organizing that, that's a crux in the model and so, you know, that's something that we're gonna have to sort out in the upcoming years. For one 50 acre plot, and currently our current experiment that size for about one acre, that hasn't been a huge pinch point yet. But it certainly will be. Say we have to organize the hardware for 8000 acres, we're gonna need some hardware costs and that's gonna have to come from somewhere.
Jason Jacobs: So given that you guys haven't been through it before in terms of starting and scaling a company, how do you think about the buckets of expertise where you need the biggest help?
Nicolas Pinkowski: That's a great question. Personally, I think we're gonna need, there's the tech side and then there's the business side. And on the business side, we're focused very much on their... on the farm. And so on the business side where we could use expertise, additional expertise is with an agronomist. What we do is we'd love to provide Nitricity recommended nutrient curves that we offer with our product. And helping us come up with those curves, we need to be out there talking to growers in the valley and agronomists in California Central Valley who can hep us make this. On the tech side, we're about to make a big jump in the next phase between a one acre size system and a 50 acre size system. And we can no longer get parts off the shelf because our power electronics have too be to big. And so we're gonna have to start working with the power and electricity grid in order to identify and engineer some of the key power electronics components in our system.
Jason Jacobs: And so what type of expertise would be helpful in navigating that?
Nicolas Pinkowski: Power electronics, high voltage.
Jason Jacobs: And do see... I mean, you mentioned intermittency before, but if storage, for example, if the cost came down on- on storage to the point where it could be applied to start to store some of that ex- excess capacity and address some of that intermittency, is that an opportunity for your costs to come way down over time?
Nicolas Pinkowski: Perhaps. The intermittency and the difference in costs is... during... as a function of the day, really, really helps us. What we are doing in some essence is energy storage. Whenever there is a lot of sun in the middle of the day and the electricity costs are cheap, lets use that to make fertilizer and- locally instead of importing it from halfway across the world. And then, you know, slowly over the course the year, we fill a tank with fertilizer that used as needed on the farm. And so now I actually think that these intermittent resources, we just need more of them and that our solution fits in as an alternative to energy storage, so let's just use it right away.
Jason Jacobs: Mm-hmm [affirmative]. And then in your wildest dreams, if you look back five years, 10 years, 20 years down the line on what Nitricity has achieved, what will you have accomplished?
Nicolas Pinkowski: Personally, I'm excited about the greenhouse gas emissions potential impact that our company can have. You know, if every system we see in the soil fixing nitrogen is mitigating greenhouse gas emissions and that's one area that drives everyone on our team to work on this problem. And so if we're on tens of thousands of acres or hundreds of thousands of acres, uh, we'll be mitigating serious CO2 emissions. And so that'll be really impactful in the long term.
Jason Jacobs: Who are the biggest players in providing the nitrogen and fertilizer to these farmers today?
Nicolas Pinkowski: Yeah, in California Central Valley, I think J.R. Simplot or Nutrien are big on providing minerals and nutrients to farms. And there's, you know, not a whole lot of different options. If you're looking at organic nitrogen fertilizer, whoever's supplying the lowest cost chicken manure, you know, that might be in business at the time.
Jason Jacobs: Uh-huh, and you mentioned California, is the landscape very different as you go to different kind of sub-geography, so different parts of the country or different parts of the world?
Nicolas Pinkowski: Not at all. No, not at all. California's a great place to start. But effectively, and we- we've all seen it when we've had the window seats of an airplane. Whenever you take off from anywhere, you're surprised at the high density of agricultural lands that you see below you. [inaudible 00:26:37], any place you see those big rotating sprinkler systems, overhead sprinkler systems drawing circles on the landscape, you can see from the airplane, those are center pivot irrigation systems and you'll see those everywhere in the world. And those are providing irrigate, irrigable nitrogen fertilizer. Pretty much all across the world, we'll have an impact there.
Jason Jacobs: And in terms of the providers, is it the same providers that are providing globally or are those kind of regionalized and is that a fragmented landscape?
Nicolas Pinkowski: Oh, it's fairly fragmented as well. The United States has- is fortunate such that there's a lot of private companies that own Haber-Bosch. Well, it's all private companies that own these Haber-Bosch facilities. I mean as you look outside the United States, these factories today that make fertilizer are so expensive that a country is the client and a country will buy Haber-Bosch factory. The Unites States is fortunate to have access to fertilizer. Where fertilizer is needed the most around the world it is unavailable or the most expensive today.
Jason Jacobs: So then is the about both eliminating the need for these factories as well as making fertilizer more accessible in places where it's not available today? Is that the pitch?
Nicolas Pinkowski: To me, that's something I care about a lot and our whole team does at Nitricity is that making nitrogen fertilizer universally available such that... You know, there's a big inequity today in where nitrogen fertilizer is the most expensive and where it is needed. For example, the Unite- the United States and then Mississippi, we have so much nitrogen and access to so much low cost nitrogen we over apply it. However, in different parts of the world where it's need today and where, in fact, famine still exists, you cannot buy nitrogen for under $1.00 a pounds.
Jason Jacobs: Why is that?
Nicolas Pinkowski: Well, [laughs], well, someone has to figure out how to by a $3 billion Haber-Bosch facility. And to need a $3 billion Haber-Bosch facility, you need to $4 billion worth of natural gas infrastructure. You need a lot of hardware to get-
Jason Jacobs: It's about energy. It's about energy accessibility.
Nicolas Pinkowski: Energy accessibility is huge and it's in balance where it's available.
Jason Jacobs: But you mentioned at the outset that this nitrogen's getting shipped from all over the world so why couldn't it just be shipped to these places that don't have their own Haber-Bosch facility?
Nicolas Pinkowski: You can't. You can't. You'll see urea around the world. The best form of fertilizer to ship is ammonia. It's high mass factional percentage nitrogen. It's nitrogen with three H's on it, that's all it is.
Jason Jacobs: Mm-hmm [affirmative]
Nicolas Pinkowski: But if you put a tank of ammonia, say is sub Saharan Africa or somewhere else, you need the infrastructure and the- something called a bar that's used in- in the Midwest to put that in the soil. And that infrastructure's simply not there. So instead, you have to... you supply a solid form fertilizer, urea, which is 46% by mass nitrogen. So it's a little bit more expensive to ship but you can- you can get it in bags and you'll see it on trucks anywhere you are in the world. That's pretty good to ship bu the costs is a direct function to how close you are to a distribution center and the coast.
Jason Jacobs: And the- the existing players that are providing nitrogen today, do they know about you guys?
Nicolas Pinkowski: Oh, [laughs], probably not. After we- we pitched, I think at MIT Clean Energy prize, there might have been the Stanford basis award, which we recently won as well, we had a fertilizer company reach out to us saying, "We'd love to learn about your technology." To which that would be great, however, we're also a fertilizer company so I don't know if we wanna tell them about our technology.
Jason Jacobs: Got it. So there's not much discus... like right now, the- the strategics are at arms length because you're more concerned with trying to figure out how to- how to unseat them and then how to collaborate, at least early on while you're proving yourself out?
Nicolas Pinkowski: Oh, we'd love to collaborate. Our model is completely different however. We're not building a handful of plants around the United States, we're building farm hardware. And so we're working more closely with irrigation companies then we ar with fertilizer companies. Fertilizer companies are so disconnected from the farms that we're working on.
Jason Jacobs: And in terms of expanding to other farmers, you mentioned tuning the model on a per farm basis, I mean what are the biggest barriers when you look at expanding from one farm to let's say 10 farms? I mean is it a... is it the manual nature of what's required of being on site or- or are there other factors that makes scaling difficult?
Nicolas Pinkowski: Yeah, we've gone from one farm to 10 farms. Provide some context, we are developing a solution that hooks up to an irrigation injection head and then irrigation injection pump. And so, you know, 10 farms is just gonna have 10 times as many of those. And so one farm with say 4000 acres or something like that, will already have a large number of those. And 10 farms is gonna have many more than that. And so at that point, we're gonna needs an assembly line. We're gonna need high throughput ability to produce the equipment.
Jason Jacobs: How resource intensive is it to actually manage the equipment one- once it's on site?
Nicolas Pinkowski: Oh, [laughs], I can tell 'ya, the answer now and I can 'ya what we hope that it is one day. We wouldn't have rented an apartment in Fresno California right next to the farm if it worked right away when we first put it down. We're out there every day working on it, optimizing it, you know, improving it. And we will likely be on the farms quite a bit for our first contracts. But, you know, at some point, in how we've designed it, is it's totally controllable online. And so we turn it off and on using a web server and we can monitor it using a web server. And hopefully we can predict it's gonna fail before it fails and can send maintenance crews out.
Jason Jacobs: So ultimately, this will be kind of essentially managed across the portfolio of the clients that you work with, that's the vision?
Nicolas Pinkowski: That's the vision. And that data would be extremely interesting as well. I hope to see what we call a- a fertilizer marauders map where we have a production assets in say 20 different location and, you know, we can see exactly the type of nitrogen being used, how much, when it's used and really optimize our systems accordingly. And monitor them to make sure they don't break when they're most needed.
Jason Jacobs: Has anything like this ever been tried before?
Nicolas Pinkowski: It's our understanding that it has not. There were large factories that made fertilizer in many different types of strategies before the incumbent Haber-Bosch process came into play. There is electric arc based techniques, there were other high temperature techniques, you know, people even tried using molten lithium to make nitrogen fertilizer, we've tried that as well, but it's all been in factories and very far away from the farms. Developing a solution that's- that's just like an irrigation pump, but it now affixes its own nitrogen is- is very unique to Nitricity.
Jason Jacobs: And this would be a different process kind of, uh, like the next generation beyond Haber-Bosch, is that what I'm hearing?
Nicolas Pinkowski: We hope so. Absolutely.
Jason Jacobs: Have you given it a name?
Nicolas Pinkowski: Oh, [laughs], I think our first one... Well, I'll be completely honest with you, the name of our sir- first system is called the Bosh Squasher.
Jason Jacobs: Nice.
Nicolas Pinkowski: [laughs].
Jason Jacobs: Yeah. It seems like, you know, the Haber-Bosch process, Newtons Laws, like you, you know, if you gus are first into finding a new process that's radically different than the process that exist today and takes the industry a f- fundamental step forward in terms of get- putting the farmer in more control, duh- delivering a higher quality, more personalized offering and eliminating a bunch of GHG emission in the process, it seems like that warrants a name that even if anyone else goes and produces similar down the road, they're using your process.
Nicolas Pinkowski: [laughs].
Jason Jacobs: My two cents.
Nicolas Pinkowski: Well, we just call it Nitricity now.
Jason Jacobs: [laughs]. Awesome. I mean you mentioned that climates a big driver for you. If you weren't doing what you're doing, what else would you be doing to tackle climate change?
Nicolas Pinkowski: Yeah, the other projects I've always been really interested in are, I'd probably join a company that I heard pitched at Stanford Energy Ventures the other day on cement, I think cement could have a lot of impact. Something like cement or steel would- would really interest me. Those are [crosstalk 00:33:43]-
Jason Jacobs: So some of these harder to carbonize areas where they're- they're big GHG drivers and no real game plan at the moment.
Nicolas Pinkowski: Yeah, these are really impactful areas that are exceedingly challenging. They need a lot of innovation and they need our best and brightest working on it today. And I think some of them are working at it at Stanford. I would join those- those folks.
Jason Jacobs: Awesome. Well anything that I didn't ask you that I should have or any parting words for the listeners?
Nicolas Pinkowski: That- that's all I got [laughs]. I can think of maybe something will come to mind here, I don't know.
Jason Jacobs: Well, I can ask you something more- more specific. So you're doing something that a lot of people that are part of the MCJ community aspire to do, which is starting a company that is trying to make a meaningful dent in GHG emissions. So if I'm an entrepreneur or aspiring entrepreneur that is listening to this episode and hearing your story and inspired by it and wanted to find my own lane, what advice would you have for me in trying to figure that out?
Nicolas Pinkowski: Well I'd say go for the big problem and don't give up. There's been a lot of times in Nitricity's history where it would- it would've been very easy to give up and stop working on the project. However, you now... and we weren't married to a single technology, we're mar- married to solving the problem and that's really helped us and it's helped us stay resilient and I think it would help other folks. So it takes a little bit of grit to start a company and, you know, some days you feel it, like the days where, you know, it's a 110 degrees on the farm and something breaks.
Jason Jacobs: Like today.
Nicolas Pinkowski: Oh.
Jason Jacobs: [laughs].
Nicolas Pinkowski: But, uh, if you stick with it, and your intention is good and you're going after something impactful then you gotta have a little bit of trust in the process.
Jason Jacobs: Awesome. Well, Nico, congrats on the progress to date and thanks for making the time to come on the show. Also, congrats on the MIT Clean Energy prize and best of luck to you and the whole team for the future. You guys are doing awesome stuff.
Nicolas Pinkowski: Thank you very much, sir. Have a great day.
Jason Jacobs: 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.
