Carbon dioxide is not the only greenhouse gas that contributes to climate change. In fact, methane emissions are responsible for 16% of the warming we experience today. And because methane is more potent than CO2, we can make a big impact in a short period of time by addressing the concentrated, continuous methane seeps that exist around the world.
Olya Irzak is the Founder and CEO of Frost Methane, a company working to combat climate change through the deployment of remote methane destruction devices. On this episode of the podcast, Olya joins Ross and Christophe to discuss why she chose to focus on methane emissions and explain how her team’s technology works to convert concentrated methane into CO2.
Olya describes Frost Methane’s initial work with Arctic permafrost and introduces their new application of the technology in coal mines, sharing how the business generates revenue through carbon markets like California’s cap-and-trade market. Listen in for Olya’s insight on the benefits of voluntary markets and learn her approach to prioritizing climate interventions to make the biggest impact.
More from the show
Ad-free episodes and other benefits come with a paid subscription.
Carbon Removal Newsroom, the news show that ran alongside this one, is over. Its episodes are still up, on the feed Climate Workers Anonymous now uses.
Carbon Removal Memes is still going.
Resources
ARPA-E Energy Innovation Summit
Center for Negative Carbon Emissions
Google’s Climate Change Initiative
‘7,000 Underground Gas Bubbles Poised to Explode in Arctic’ in The Siberian Times
Video of Exploding Under-Ice Methane Gas in Siberia
Pleistocene Park on Reversing Climate Change EP073
ASU’s Arctic Ice Management Project
University of Beijing Research on Calving
‘Sometimes Success Is Right Under Your Feet, As Tomato Grower Knows’ in AP News
California’s Cap-and-Trade Program
Carbon Offsetting and Reduction Scheme for International Aviation
Full Transcript
Ross Kenyon: Hey everyone, welcome to season two of Reversing Climate Change. We are doing that podcast thing now and launching a Patreon. You can find it at patreon. com slash noripodcasts. There are various tiers with different types of goodies available. Do you want to receive a special newsletter digest of what norinauts are reading that week? Be a part of a nori book club? Get special access to nori events? Go take a look at patreon. com slash noripodcasts for what we’re offering. And in that spirit of being lean in that startup kind of way that, you know, we like to do, this list of goodies is subject to change, and we’d very much like your feedback.
Is there something that you’d really like to see, but it isn’t listed here? Honest feedback does a lot to help us shape what we offer to you. You can send an email to podcast. nori. com or fill out our podcast survey anonymously in our newsletter, which you can find at nori. com slash subscribe. And thank you so much for listening to another season of Reversing Climate Change. Hello and welcome to the Reversing Climate Change podcast. I’m Ross Kenyon, co-hosting alongside Christophe Jospe. Hello, Christophe.
Christophe Jospe: Hello, hello. Yeah, we were just reminiscing when we met. It was one of these really crowded conference halls at an unnamed hotel in Washington, D. C. for the ARPA-E Conference. Which, what’s that? The Advanced Research Projects Association-Energy. And both Oleo and I were working for different places. I was at the Center for Negative Carbon Emissions, geeking out about things that pull carbon out of the atmosphere. And Oleo was working for a small little search engine company you probably haven’t heard of. And had like a, you know, name of an organization that was by a letter.
But anyway, we hit it off. We realized we wanted to stay networked in with each other. So thank you, LinkedIn, for making that possible. And then, yeah, at some point I got a notification that she started. And so she was a founder and CEO of a company called Frost Methane. And she didn’t know it, but we knew it, that it was only a matter of time until she would come on to the Reversing Climate Change podcast. So welcome, Olea.
Olya Irzak: Thank you. Good to, I guess, see you virtually again.
Christophe Jospe: So you offered to share your bio and I said, I don’t want to know it because you can just share with the listeners. We don’t need to go through your whole CV, but what’s the path that got you to where you are today?
Olya Irzak: Yeah. So I’m a computer scientist by training. And at some point during my master’s, I read a four-page article in Scientific American, And I haven’t worked on anything that wasn’t climate change related ever since. I went to this small search company, as you referred, to work on their, they had a . org at the time. I still have a . org, worked on some of their climate change initiatives, both at Core Google and at Google X later. Then I went and worked on On mini grids in Sub-Saharan Africa to see what developing world emissions really looked like.
But throughout this entire time, I definitely had a thing for gases other than CO2 and their roles in climate change. And so I started investigating methane and saw this really big opportunity and founded this company.
Christophe Jospe: For our listeners, I mean, we like to geek out about this and our listeners are really intelligent. They understand that carbon dioxide is a greenhouse gas. I think they get that CH4 is a greenhouse gas too. Why methane? Why do we need to consider methane? Can’t we just only talk about CO2?
Olya Irzak: I mean, it depends what part of the problem you want to address. Methane is 16% of the warming that we experienced today. And so it should be 16% of the solution. It also is pretty interesting because methane is much more potent of a gas than CO2, so the absolute number of molecules that we need to mitigate in order to achieve the same effect is a lot smaller.
Christophe Jospe: Okay, so if you could literally and figuratively break it down for us, what does that mean? I mean, here are people throwing terms around radiative forcing, so methane is a lot more potent, but what does that actually look like on a molecular level?
Olya Irzak: Yeah, so each molecule of methane, when it’s in the atmosphere, absorbs significantly more heat. However, and that’s the heat that’s absorbed that is not coincident with other absorption spectra, for example, of water or other things in the atmosphere. Now, methane’s half-life in the atmosphere is shorter than CO2. So when people talk about the kind of equivalency of the gases, they often pick a time frame over which they compare them. So what is the cumulative warming of a methane molecule in the atmosphere, including the decomposition from its half-life? And what’s that total warming?
That would happen for a molecule of methane emitted today into the atmosphere compared to one of CO2. So if you ever hear kind of these equivalency of methane is 28 times more potent than CO2. Other people say methane is 84 times more potent than a molecule of CO2. The difference is about the time length that they’re considering for the equivalency. And so, you know, we, us and, you know, the carbon markets chose 100 years as the relevant equivalency.
Christophe Jospe: So it’s almost like the greenhouse gas has this lifetime and it breaks down over that lifetime. And as it breaks down its strength as that kind of blanket that warms the earth just reduces, right?
Olya Irzak: Exactly. Exactly. And methane breaks down into CO2.
Christophe Jospe: And it seems kind of arbitrary when you’re throwing these ages around. So how exactly did you arrive on 100 years?
Olya Irzak: I agree that it’s reasonably arbitrary. I think it has a lot to do with when do we think that humanity will be far along on the way of mitigating climate change. But you see that same 100-year choice in, for example, forestry. Like how long does a tree need to be standing in the carbon offset markets in order to count? So those contracts, there’s literally contracts that are like, For the next 100 years, that this forest will be standing with certain carbon content. And I’m sure you guys see that as well in the soil of how long do you need to prove that the carbon is going to stay down there.
So I think there is some amount of a number just needs to be chosen in order for a system to be built around it. And so the carbon markets, and there’s a lot of things in the IPCC that have kind of chosen that 100 year time frame. And it seems like, just as an intuitive thing, I don’t think that’s particularly scientific, the 20-year timelines in many senses seem pretty short. It seems unlikely that we will be well on our way to mitigating climate change by then. And so the 100-year timeframe seems like perhaps the time where we’ll have enough of these technologies that have reached maturity and emissions that are going to zero or to negative at that point.
Ross Kenyon: Well, Olya, where does Frostmethane enter the picture, which is your company?
Olya Irzak: Yeah. So what we do is we find very concentrated methane emissions that are continuous in nature. So essentially our hypothesis is that one of the cheaper ways of mitigating climate change in this sort of gas world, right? There’s of course other infrastructure changes that can be made, but we basically chose to have a very potent greenhouse gas and find a very high flow set of sources for it. And that means that we can We have a lot of the climate change potential in one source. And of course, anything concentrated is easier to work with.
So what we do is we find these concentrated sources. We install devices on top of them to flare them. So we convert methane to CO2 immediately rather than have it accumulate all that warming before eventually breaking down into CO2 anyways. And so that, according to that 100-year equivalency, reduces the warming by 96%. And so we install these devices that continuously flare the methane and turn it into CO2. And that reduction can be put into the carbon offset markets in order to generate revenue and then fuel the growth of the business.
Ross Kenyon: And frost is in your name. So one would imagine that there’s something happening in cold places. But I know that... You’ve made a little bit of a business pivot since we first spoke. Where was the company starting out in terms of its concept and vision? And where have you ended up just by testing the market and figuring out what works?
Olya Irzak: Yeah. So we first indeed started in the permafrost. And the thing that triggered this entire business was actually an article in the Siberian Times. I hope you all read the Siberian Times.
Ross Kenyon: I’m a Colima Post subscriber.
Olya Irzak: Oh.
Ross Kenyon: Sorry.
Olya Irzak: So a few years ago, there started being these methane bubbles. They’re known as pseudopingos that were popping up in the Yamal Peninsula in Siberia. Even when those became exposed to the air, like sort of the earth, it wasn’t exactly an explosion because I think there was no burning necessarily. But when the pressure kind of went up high enough and the earth on top of that wasn’t covering it anymore, the sensors that people have measured in the crater were Still show 10% of methane while it’s exposed to the air. Of course, methane is lighter than air.
So if you’re detecting a large concentrations, that means a continuous source. And the thing that really triggered me on that one is I thought the permafrost methane emissions, I already knew that there was twice as much carbon in the permafrost as in the atmosphere, and that some of it was going to come out as CO2, some of it was going to come out as methane. But I was under the impression that it’s ancient vegetation that hasn’t had a chance to rot yet, that we were going to see very slow, diffuse methane emissions.
And here we had These really concentrated large emissions. And because I had previously worked at Google, which is a carbon neutral company and offsets its emissions, I already knew that there are quite a bit about the carbon offset markets and that methane is one of the ways that these markets operate. And so the idea kind of came to me literally from that Siberian Time article. I did the back of the envelope, and they were saying there were 7,000 of these hills ready to explode, which we have not seen that. But that back of the envelope showed half a percent of global human emissions from two small peninsulas in Siberia, potentially.
And so that was the thing that while I still had a full-time job, I gathered a bunch of friends, and that’s when we actually built the first permafrost methane mitigating prototype.
Christophe Jospe: Can I share a fear that I have, which is the permafrost melts, a whole lot of methane in an uncontrollable amount will just release. And that fear is kind of countered with the joy of what your company is going after because you’re saying you can help destroy some of that methane as it might I mean, there are plenty of these videos on YouTube where people literally like poke a hole in Siberian Lake and then light a batch and it just starts flaring. Is it as simple as that? Or is there more to the technology to figure out where to make the greatest impact?
And I guess the second part of my question, which I underlay all of like, I’m really freaked out about this happening and things spiraling out of control. What can we do to slow the methane from ever wanting to be released in the first place?
Olya Irzak: Yeah, those are great. I definitely share that fear, which is why we started originally working on that just as a side project, totally on our own money. So to your first question about people poking a hole in the ice and releasing some methane. Those are very, very small methane pockets. So the stuff that we handle is several order of magnitude larger. When it happens in lakes, which there are concentrated methane releases in lakes, it’s bubbling so much that even past the Arctic Circle, the lake doesn’t freeze because there’s constant bubbling and constant mixing of the water.
So those are the sort of things that we handle rather than the ones where you have to poke, which is It’s not trivial amounts of methane, especially because it’s all over the 9% of the Earth’s surface, which is the permafrost, but it is, relatively speaking, much less low-hanging fruit. So yes, we handle the really, really big ones. We handle the potentially one explanation that we heard for what we’re seeing is either large natural gas pockets released or The methane hydrides that are in the permafrost rather than in the ocean, those methane hydrides also losing their stability.
So to your questions around the technology. So the technology really only works when you can install it and then forget it. Basically, it survives in Arctic conditions for a really, really long time. And so, you know, we have an amazing team, including one guy, Lachlan Barker, that worked for three years in Antarctica on underwater robotics. So we got incredibly lucky to have his help on that. We also have other folks that have worked on anywhere from rocketry to nuclear with experience of making things last in really harsh conditions. But it really only works if we set it and it continuously, day in and day out for several years.
Revers mitigates all of those emissions, and then we can come and occasionally do batch maintenance. The other interesting piece of technology there, other than you have to collect this methane, sometimes in an aquatic environment, separates the gas from the water from the various debris that comes with it, then have it go into a measurement section because it’s extremely important to precisely measure how much we’re mitigating. First of all, for the carbon offset markets, and second of all, because that’s scientifically important. Then have a chamber where we can have complete combustion and all of this with a very minimal number of moving parts because the correlation between how likely your device is to fail is very correlated with number of moving parts.
And we’ve done a bunch of really clever tricks to make sure that both our power sources and our mechanics and all of that can survive a harsh Arctic winter and freeze and thaw cycles. And you had a second part of the question.
Christophe Jospe: You covered it. I guess it was on the how do we rapidly scale up where we might be most concerned of this melting.
Olya Irzak: Oh, sorry. Then I have another answer for you. And then I have a piece of good news. So the other answer is how do we find these things in the first place, right? So there’s lots of interesting new satellite technologies, both observing the methane directly and observing various adjacencies where we now might be able to find where these things pop up. And when they pop up, they seem to just constantly continue. There hasn’t been a case of that methane flow in the permafrost stopping. So once we know where it is, we can take care of it.
And then my other piece of good news for you to your previous fear is that there is also a project in Russia called Pleistocene Park, which is attempting to handle some of the diffuse methane emissions, essentially by reducing the temperature of the permafrost. I don’t know if you guys have heard of Oh, yeah.
Ross Kenyon: They’ve been on the show before and I’m not surprised.
Olya Irzak: Oh, wonderful.
Ross Kenyon: Yeah. You clearly have to know each other. How many other Siberian, massively important climate change projects are there? Is there someone else out there that we should be aware of in that region?
Olya Irzak: Yes, absolutely. So less about the permafrost, but more about the potential feedback loops of the glaciers. There’s, of course, Ice 9-1-1. You guys may have met Leslie Field.
Ross Kenyon: I don’t believe so.
Olya Irzak: Oh, well, you should. She’s awesome. So that’s an interesting one. That’s quite, I think, the furthest one along of the kind of multi-year or the kind of how do we keep glaciers from melting. And then there is another couple of proposals. There was one from the University of Arizona, I believe, that was kind of a much more massive undertaking than Leslie’s, which is like a very... Immediately implementable solution, but there was one around there of basically in the winter getting fresh, pumping ocean water on top of glaciers in order to thicken them.
There is another one on preventing glaciers from calving from a glaciologist. I believe he’s in the University of Beijing and his name escapes me right now, but I can send it to you afterwards. I think that might be all of the ones that I know as far as like Arctic projects. Oh, unless you count actually silver lining in some sense, if deployed strictly over the Arctic is also, that’s the cloud brightening project. So that’s another one that could be localized over the area where feedback loops are most likely, right? If kind of we have cloud brightening, so you have less direct sun over a particular area, that can also help a lot.
Ross Kenyon: Okay. Yeah. Thanks for clarifying that. Oh, I’m glad to hear that there are other Arctic projects out there, some of which I hadn’t even heard of. I will have to do research. So thank you for telling us about that. Olya, you have explained your origins with frost methane, focusing on Arctic lakes. How and why did you pivot to new applications of that technology? What are you focusing on now?
Olya Irzak: Yes. So there was a few reasons. So one of them was COVID and exposing remote populations to a virus was not sitting particularly well with us. But actually we... Found just a very, very large opportunity where we could apply exactly the same technology. So essentially, we were looking at coal mines, which, as you know, is 2% of global human emissions, just the methane content of them, right? Not to mention the actual coal that you then burn. And that methane is entirely, entirely a byproduct, right? It’s just the coal under some circumstances forms together with the methane.
And during the mining process, it comes out. And so there was this 2% of global human emissions, right? That was already a methodology in the California cap and trade, which was basically staring us in the face. So we came across that as we were looking at various things that we could do during the winter. The installation, the field season in the Arctic is very, very short. And so we always wanted to have two sides of the business, at least something in the summer and then Other things that we should be able to do outside of that.
And so when we were looking at this 2% of global emissions and these mines continue to emit even after they’re shut down. So the decline in coal is definitely on the 100 year period is very relevant to decline of the associated methane emissions. But we’d like to take care of that before the 100 years. And it’s a very similar thing where there’s a very concentrated continuous flow of methane where we could take care of it by flaring the methane and turning it into CO2. And in fact, now that it’s more populated areas, we could even bring productive uses on site or do something that is potentially beneficial to the local population there.
And in addition, there was this really great revenue source. And we’re having a much better time iterating on the technology. Since it’s much closer to home and easier to get to outside of the summer seasons. So just this really, really huge opportunity, you know, faster, faster ability to earn revenue and then to continue expanding. So I would say I would call it maybe a little more like prioritization, reprioritization rather than pivot, since we still think that there is a great mitigation potential and a great business model in the Arctic, but it would be really good to get our technology to maturity closer to home and on these other large sites.
Christophe Jospe: I really like that. And I think it goes to kind of starting small and building from successes and learning and iterating from there. You mentioned that you’re also finding productive uses of some of these gases. Can you talk about what you envision there?
Olya Irzak: Yeah, absolutely. So I think at the end of the day, methane is the same as natural gas, right? Like you can put it in a generator and have some electricity. There’s heat. About 30 or 40 years ago, there’s a miner in Illinois that got like hurt in a mining accident and ended up buying the rights to the methane in an abandoned mine and put a greenhouse and grew tomatoes from that methane. So I by no means take credit for any of these ideas. But we ran some financial models on what you can do with the methane.
Of course, purifying and putting it in the pipeline is not economical, which is why current production companies don’t go after it. Putting it in a generator and selling the electricity, anytime you have to run a wire... It is extremely expensive, right? Like building transmission lines is not something that’s available to us right now, but any, let’s say, something heavy computation, but not very heavy data requirements is something that we can bring literally on site. And in some cases, some of these farming communities or something nearby that would require power that is maybe not as close to the grid that’s running a generator, depending on So I think our plan is to get just the basic flaring on as many sources as we can.
That will help us use the carbon offset markets to very precisely characterize the flow rates, the differences in flow rates, and tell people what we can generate. And once we’ve got that, we’ll open up to many, many partners that would be local, And would be able to say whether they can use this methane or not, right? Or this methane or the electricity that we can generate from it. So we’ve got one potential partner already, but we’ll definitely open it up for more with the very precise specs of how much we can generate and when and what’s the fluctuation.
Great.
Christophe Jospe: So let’s talk about the carbon offset markets, source of demand for seeing more of this technology scaling up.
Olya Irzak: Mm-hmm.
Christophe Jospe: How does that work today? And how does frost methane fit into this as you grow?
Olya Irzak: Yeah, absolutely. So, you know, our first market is in California cap and trade. So it’s a compliance market rather than a voluntary market. And essentially, you have a whole bunch of entities that are capped at a certain amount. They either reduce their emissions to reach that cap. Buy it from someone who has or buy offsets. And some percentage of their reduction could be fulfilled with offsets and some other one has to be done with allowances or reductions. And so that’s a really, really great market for us. It’s a market which has only six methodologies approved in it.
And only one of those is the methane for mine mitigation. So there’s no additional... So that’s the one that’s like by far the most easy to work with in the US. Internationally, there’s lots of jurisdictions. That have their own carbon markets. But I think we’d be very interested for when Corsia, the airline market, comes online. We think that would be a very good source for us because that will be a little bit independent of jurisdiction. Like it’s the same rules for several different countries. So we could really go after the low hanging fruit, regardless of the geography with that market.
Christophe Jospe: Out of all the acronyms in the climate space that really stick, I got to give it to Corsia, which is the offset and reduction scheme for international aviation. I’m curious on the economics of this. So how do you think about pricing for the carbon credits?
Olya Irzak: Right. So in the California cap and trades, the markets, like in compliance markets, it’s a little bit different than in the voluntary one where the pricing is reasonably set by the market. So in the California cap and trade, there is indexes with the pricing that you get for credit, which has an eight-year invalidation potential. So in the California cap and trade, there’s two sets of validations. There’s the normal validation as you would in the voluntary market. And then that credit can still be invalidated for some number of years. So there’s basically indexes that work based on that.
And in California cap and trade, Every year, the price increased by about 5%. So we don’t so much set the pricing in the same way that we would in the voluntary market. And we expect Coursera to look pretty similar to that since the European Union market also seems to have that preset in a way that the voluntary ones don’t. So until we work in the voluntary markets, I think we’ll just go with what the market sets. And our costs of productions are quite a bit lower than that. So we have no complaints on the current pricing.
Ross Kenyon: Olya, is your reliance on offsets, is that something that you are reliant upon just because that is the way it is? Or do you think that’s the best way to do things? Do you think companies or processes that emit methane should be required to remove or not emit them in the first place?
Olya Irzak: I think in some ways, that has to happen across a very large number of jurisdictions. So I think as far as You know, something that would be a really good solution. Absolutely. There’s a lot of regulations that should be put in place, but That wouldn’t happen for, let’s say, mines that are already completed and abandoned. One of the sites that we’re looking at has been emitting methane literally out of an old pipe in the ground since 1985. It will be very interesting to see what kind of regulation we’ll be able to take care of some of that and some of the natural sources.
For the active sites, I think that would be a really great solution, but I don’t understand politics well enough to know how feasible or not feasible it is. So yeah, I think it’s a good final solution, but it seems unlikely to be implemented anytime soon across the jurisdictions that produce the vast majority of it. And so carbon market seems like a pretty good solution for basically being able to get that additionality on top of existing regulations. And as regulations change, like for example, if in some jurisdictions, if in West Virginia tomorrow, It becomes illegal to emit from coal mines.
Any projects we do there absolutely shouldn’t count towards the California cap and trade. I think at that point, because we’re producing some low-cost equipment for it, we think we’d still have a market as far as helping those companies meet compliance. I think at the end of the day, we still have to do the same things. It’s just a question of what is the exact revenue source. If we’re serious about climate change, I think we Have to put some kind of, as you said, either regulations and then we can help them meet it or carbon offsets.
But in general, one thing that I really enjoy about the carbon offset markets is that it allows for things that might be too small for regulations or too politically infeasible for regulations to still be taken care of in the meantime.
Ross Kenyon: I see that reaction quite often or one adjacent to what you’re saying. I was just seeing this in a Slack group recently of someone making the case. I think you saw it too, Christoph. Someone saying, voluntary markets, they don’t do all the things that we want them to. We should ignore them and just focus on compliance markets or on regulation itself without some sort of market compliance mechanism.
Olya Irzak: I wasn’t trying to say that we should ignore the voluntary markets. I think they fill a very specific purpose, which I think is great. But if we can play in both, we’ll play in the compliance.
Ross Kenyon: Oh, yeah. I didn’t mean to put words in your mouth that you were something like that. I guess I kind of just worded it poorly.
Olya Irzak: No, all good.
Ross Kenyon: But yeah, I saw that. I was saying like this sort of... If you could write a perfect regulation that got everything right the first time, because once something is written into law... Maybe this isn’t empirically true. Christoph, I’d like your opinion on this. I imagine on almost all cases, it is harder to change something that is law, that is regulatory, whether it’s administrative or it’s actually legislation. To change something like that relative to changing some market policy that’s voluntary. Is that actually true? I imagine that government policy is always slower than markets.
Is this a bias that I have? Or is that actually true?
Christophe Jospe: Are you asking me, Rob? I mean, it’s a great question. I don’t know if I want to answer it directly. I’d rather say like, You need the markets and the government to go hand in hand and you need the government to wake up and say, hey, I’m going to make freely dumping CO2 in the atmosphere illegal. You can use these voluntary mechanisms or buy an NRT or a CRT or a ERT or whatever alphabet soup or whatever offset credit meets whatever set of compliances that whatever technical due diligence has said, yes, we sign off on this.
And we hope for the best that the technical due diligence works and gets better over time. And then you let the market figure it out. And I think good governments will get that. Even in like, so the voluntary carbon markets are, you know, Very small percent of what the compliance markets represent. And so I think it’s natural to think, yeah, compliance markets are going to grow and keep growing. And as I think about all this, as an entrepreneur, I’m kind of thinking, actually, one of your competitors is the government. They could wake up one day and say, hey, this is ridiculous.
We’re just going to do this ourselves. It’s ridiculous that we are emitting so much carbon on these lands. And that buy-in actually has the project getting completed faster. But yeah, the reality is bureaucracy sucks and is really hard to work with. And that’s why entrepreneurs do what they do.
Olya Irzak: I honestly am not very worried about the government as our competitor. I think it would be honestly kind of great. And I think they would still need somebody to implement the actual mitigation for them. And our kind of innovations around the monitoring system should be pretty useful there. So I honestly think that would be great. And the other thing that I really like about the voluntary markets is that they’re actually a really great playground. It’s really hard to get the methodology right to begin with. And when it’s a compliance thing, like if you looked at the California compliance markets, you see insurance and in case something gets invalidated, they have to buy other things.
So really, there’s a lot of risk averseness in trying out new methods in compliance markets because the cost of messing up is so high. So having these voluntary markets where, say, a company bought some credits and somebody found a loophole and there’s some gaming, well, you can plug that and that company doesn’t necessarily... So the number of methodologies in these voluntary markets is really, really overlarge. And it works itself out and gets better over time. And when it gets a certain methodology, we trust it enough. I feel like then compliance markets start adopting it in a way that failing has failed.
So I’m kind of a big fan of having both a slightly higher risk appetite playground where we could put something like, hey, look, here’s our Arctic methane mitigation project where it’s like a somewhat lightweight process, still pretty heavy, but... Relative to getting in on California government trade, right? Here’s one, we can run it for a couple of years. You know, we can prove we have a revenue model to prove for a few years that this is like really bulletproof offsets and then get them into other markets. So I think it serves a really great purpose.
Ross Kenyon: Yeah, it sounds like I framed it in a way. I think the way you framed it is better than the way that I did. But it sounds like you’re somewhat in agreement that voluntary markets are faster, more flexible. Et cetera. Okay. Yeah.
Olya Irzak: I think to get a new methodology, I’m sure you guys have looked into that as well, right? To get a new methodology into any of the voluntary registries, there is a set process. You know how much money and time it’s going to take to get something into the California cap and trade. That’s a much less transparent process to me at least, right? And that has to happen after it’s already in the voluntary ones. So there’s definitely at least double the process and potentially more. So definitely for us to get a new methodology approved, it would be voluntary first.
Ross Kenyon: Yeah, I guess the attitude that I saw was, why don’t we just write a perfect regulation where everything works the first time and compliance is simple? I was like, yeah, we can do that inside of our unicorn castle. Why don’t we do that?
Olya Irzak: I feel the same way about when I used to write code. Why can’t I just write perfect code the first time that never has to change as the state of the world changes? I just, you know...
Ross Kenyon: That’s a hard question too. Nori is a voluntary marketplace and we have to be... Part of the podcast is trying to be upfront about what we’re learning and when things have to change, how we communicate that and fix things fast. Fail fast, fix things and fix things in a transparent way that encourages trust. I think that’s a really valuable way to do things.
Olya Irzak: Yeah, exactly. And we’ve seen a little bit of that in the early voluntary markets too, right? There was the issue with N2O from, I believe, the Ryan Manufacturing Facilities. And then that methodology was taken off and other methodologies were performing really well and they stayed on. So I think that’s really great that you guys are really upfront about what’s working well and what isn’t. Because even if the risk is there’s 5% of offsets that we haven’t caught some gaming on or something like that, that’s still There’s still 95% where we are doing the cheapest mitigation that we can, which is really interesting to me.
For example, a company like Google or any of the large companies that mitigate their emissions They turn a kilowatt hour into gold basically, right? Into like huge sums of money. And so the amount that it would take to switch that to be completely carbon free might be actually really astronomical costs while a company like ours can do it for a fraction of the cost. And so I think it’s really like the market effect of that, of we mitigate the cheapest things first. As it takes us a while to develop technologies to mitigate what’s currently more expensive, but after we presumably bring down some technologies down the cost curves, those would be cheaper.
That is an ordering that makes sense to me. We don’t have to go with whoever has the money has to mitigate their emissions. Whoever has the money can find a large amount of emission mitigation somewhere else that is cheaper.
Christophe Jospe: What’s the order of magnitude that you hope to see in the coming years in terms of tonnes of CO2 abated?
Olya Irzak: From our project?
Christophe Jospe: Yeah.
Olya Irzak: This is where there is an internal conflict between my fear of overpromising and my ability to dream. So the only thing that I’m going to say is that methane from coal mines is 2% of global emissions. Of course, we won’t be able to mitigate all of it. Some of it, it’s getting more than 50% out of each site is reasonably tricky. There might be some countries where we would have trouble operating. Of course, there’s other folks that are trying to work on this from different angles. But let’s just say that our upper limit is 2% of global emissions, and then I’ll leave it at that.
Ross Kenyon: It’s still quite a lot.
Olya Irzak: Oh, I mean, I can die happy, you know?
Ross Kenyon: Yeah, someone said to me the other day, is your total addressable market just all carbon emissions historically? I was like, God, if someone said that in a meeting or like a pitch meeting, wouldn’t you just laugh that person out of the room? But maybe, but also probably not. That’s too much.
Olya Irzak: Yeah, I think like the way that I think about it is kind of what percentage of that problem we can like realistically address. And one of the things that’s It makes it a little bit easier for me to think about as opposed to like all of the methane is like each one of our projects right now is like reasonably large. And so it’s kind of a question of how many such projects can we do, right? So if like one of our projects is, let’s call it 60,000 tonnes of CO2 equivalent, you know, then how many of those do we need to do in order to make an impact?
So that’s kind of an easier thing sometimes.
Christophe Jospe: So yeah, it’s sort of like we have all these different emission reductions, avoidances, carbon removals, interventions that we humans can take. And what I hear you saying is it makes a lot of sense to do those things that are dirt cheapest, like with a little bit of funding and a lot more quickly, do these things first.
Ross Kenyon: Mm-hmm.
Christophe Jospe: And all these things need to fit in a basket of all sorts of interventions humans need to make so that we can actually bend the curve of the total amount of greenhouse gases in the atmosphere. I guess my question is, what’s your theory of change of not only how frost methane sits, but kind of amongst all of the carbon reductions, avoidances, and interventions that we can make?
Olya Irzak: Yeah, I think if I understand what you’re asking, I think there’s two things to consider, right? There’s the things of like, what are the cheapest, largest things that we can do now? Because in any, I feel like in any political system, there’s typically a budget that you allocate for something. So let’s say we have like a billion dollars to go and remove or to reduce the amount of greenhouse gases in the atmosphere. So there’s that of like, what’s the best we can do with the amount of money that we’ll have allocated?
Because there isn’t a system where you don’t exactly allocate a budget in some mechanism or another. And the second one is how do we bring things down the cost curve, right? So I think the first one is about the avoided versus drawdown and so on. It sort of seems like the atmosphere doesn’t care whether we took out You know, a ton of CO2 versus we didn’t emit a ton of CO2. So to me, in many ways, from just what’s the best we can do as far as accumulation of gases in the atmosphere, I don’t have a huge preference on drawdown versus emissions to meet the question or versus avoid emissions.
To me, the question is which one’s cheaper? Given the current regulation over time, of course, we want to go to regulations where the people don’t get to emit it for free. And so the avoided emission happens as part of a different system. But what it is today where emissions are free, I don’t have a huge preference between avoided emissions versus drawdown. Now, as far as what technologies do we believe will be needed in the future or can go down the cost curve really quickly, that I think is a separate calculation.
Because I think our technology is ready to go now. So I don’t think any of the people like Stripe, for example, that are thinking about what are the future technologies that are coming and how can we support not today’s wave of companies, but the companies in a few years where they will be competitive economically and how do we get them there? That I think is a very different calculus about what is it that we’re going to need. And then you’re willing to pay much more per ton in order to give them that initial market.
And so I’m really happy that both sets of markets exist. The ones that say, what’s the cheapest way of doing this now? And then the markets that say, what’s the cheapest way in the future? And how do we, or maybe they’re like, oh, s***. Button of like, now we care all of a sudden, now we need like much more to bring to bear. And that there are separate markets that are trying to take those technologies down the coast curve until they can play in the first market easily, right? So it’s much like what you get with like subsidies at the beginning for technology that’s super promising to be cost competitive on its own later.
Ross Kenyon: When you said the button, the first thing I thought of is the Siberian traps exploding. That’s what I, that’s an button kind of moment. Olya, that’s all fantastic. Thanks so much for sharing all this with us. And if someone is listening and they want to keep up with you personally, Ross Methane, etc. , where would you direct them?
Olya Irzak: I think LinkedIn is our best bet right now.
Ross Kenyon: LinkedIn?
Olya Irzak: Yeah. And LinkedIn is definitely the best way to find us.
Ross Kenyon: Links are in the show notes, or I should say link is in the show notes. Thanks for being here, Olya.
Olya Irzak: Yeah, thanks. This was great. I’m so happy for podcasts.
Ross Kenyon: Oh, that’s great to hear. We love hearing it. And it’s fun for us. It’s a perfect sort of symbiosis, you could say.
Olya Irzak: Yeah, we’ll hope to one day do this in person. In a few years, you can check up what happened with us, how many times we actually managed to reduce in like, let’s say, four years.
Ross Kenyon: Oh, no. Yeah, that sounds good. Well, thanks so much for being here. And thank you, Kristoff, as well. Yeah, this was so much fun. Thanks, Elia and Ross.
Olya Irzak: Yeah, thanks, guys.
Ross Kenyon: My pleasure. And if you’re listening out there, if Christoph and I could ask you for a favor, and that favor is going into your podcast app, assuming you’re using iTunes or the podcast app that is on your iPhone without you having to do anything about it, if you could open that up and write us a review and hopefully rate us five stars as well, assuming you actually feel that in the depths of your heart. And write us a kind review. It certainly helps us get this content out to more people that there are very interesting entrepreneurial approaches to climate change like frost methane that we want to share with people.
So please do that. Thank you so much for listening and have a lovely day. Well, thank you so much for listening. If you like the show, please rate and review it in Apple Podcasts and or Stitcher. It really helps us a lot to get this content to a wider audience. If you think what we’re doing is useful, interesting, fun, hopefully all three, we’d certainly appreciate your rating and review. You can keep up with Nori at nori. com where there is a newsletter that’s nori. com slash subscribe. There’s podcast, there’s a whole bunch else, or you can send us an email at podcast at nori.
com. We are also now on Patreon at patreon. com slash nori podcasts if you’d like more content, engagement, and community. And thank you so much for your support.
