This is episode #421 of the Reversing Climate Change podcast. You can listen on Spotify (subscribe there for its ad-free version), Apple Podcasts, YouTube, or wherever else you listen. Substack paid subscribers get the ad-free version right here on the page.
There are so many stories about being inside of stories at this point I can't even keep up. Granted, a good chunk of them come from Charlie Kaufman, but there are also films that play with genre like Cabin in the Woods, They Came Together, Isn't It Romantic, or the entire Shrek universe. I got fourth wall-pilled as a kid by loving Blazing Saddles and Monty Python and the Holy Grail.
As our lives (or at least mine) are increasingly mediated by stories, film and literature have more and more characters living in a world made of story. This has been true for literary fiction at least since David Foster Wallace declared his primary addiction to be to television.
With a windup like that, you must know I'm about to ask: which story is carbon dioxide removal within?
We have so many alternatives from within business lore—Moore's Law, the Gartner Hype Cycle, the solar cost curve—but also many other stories and expectations about the direction of history (Whiggish, up and to the right, the arc of the moral universe is long but it bends towards justice). How much of this belief is hyperstition that we need to will this new world into existence? And how much is morally sound delusion; to dream the impossible dream?
But what if we find out we are actually in the wrong story? For this, I must turn to one of my favorite films of all time, Adaptation.
Rudy Krehbiel thinks some of those stories are misleading us, and this episode is about working out which ones. My introduction runs long because I wanted to talk about Charlie Kaufman's Adaptation first, a film about a man who does not know what genre he is in until the genre changes around him, and which you should watch whether or not you have ever thought about a carbon credit.
Rudy works on strategic development at EcoEngineers, who also sponsor this show, and he came into carbon dioxide removal from startups and venture capital, which is why he keeps reaching for diffusion curves. His read is that we are at the innovator stage and mistaking it for a trough. His figures, and they hold up against CDR.fyi's April 2026 snapshot: fewer than 50 million tonnes contracted, barely over a million delivered, Microsoft alone accounting for 78.5% of the disclosed total, and a median purchase outside Microsoft still under 100 tonnes. Diagnose that as failure and you start prescribing medicine for a disease nobody has.
The harder argument is the one about public goods. Solar panels and EVs deliver something microeconomic you would still buy if climate change did not exist. A tonne of carbon dioxide removed does not. That makes this, in Rudy's words, arguably the hardest public good anyone has tried to fund, and it is why he will not call the ending inevitable. I asked him to name the story we ought to be inside of. What he answered? You'll have to listen to find out.
This episode’s sponsor
EcoEngineers: a full-service advisory and consulting firm focused on carbon dioxide removal, decarbonization, and carbon markets.
Rudy works at EcoEngineers and EcoEngineers sponsors this show. I would have had him on either way, and you should know the arrangement.
Resources
Subscribe to the Reversing Climate Change Substack for bonus content and ad-free episodes
Climate Workers Anonymous, the other show I make
"How Carbon Removal Loses", the episode Rudy and I keep circling
Belief that makes itself true: a hyperstition for carbon dioxide removal
How non-human intelligence will change us, with D.W. Pasulka, where the Marshall McLuhan scene comes up
Adaptation (2002), written by Charlie Kaufman, directed by Spike Jonze
The Orchid Thief by Susan Orlean
Story by Robert McKee
Diffusion of Innovations, Everett Rogers
Crossing the Chasm, Geoffrey Moore
CDR.fyi's demand structure snapshot, April 2026, the source for the Microsoft and Frontier concentration figures
Public good, non-rivalrous and non-excludable, used correctly for once (my pet peeve)
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 goofing around.
The books that come up on this show are collected on my Bookshop shelf.
Full Transcript
Host introduction
Ross Kenyon: Hello, welcome to Reversing Climate Change. I’m Ross Kenyon. I am the host of Reversing Climate Change. Did you know this podcast has been running almost a decade? Thanks for listening. So happy you’re here.
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Today’s episode is with Rudy Krehbiel. Rudy works at EcoEngineers. If you heard the sponsor message at the beginning of this episode, you will know a little bit about Rudy.
Rudy and I talk about a topic that I’m so obsessed with, and if you’ve been listening to the show for a while, you will catch echoes in what I’m about to tell you. The question we were asking ourselves is, which story is carbon removal actually in right now? And which story or stories do we think we’re in right now?
Every industry has its mythology. And being inside of a story can be really helpful. In fact, if you’re watching a film or reading a book, there are certain beats that we expect to come from stories. And to what degree is that built into the structure of our mind? Or maybe our culture just trains us so much to think in terms of act structure and beats that we start looking for patterns even while we’re in the story.
For instance, the hype cycle story is one that is very popular, and the hype cycle has a sense that, okay, we get really hyped up and there’s a bubble, and then we come back down to reality, and it’s in this period where we’re in a trough where, oh, we’re never gonna get back to normal, but the long-term trend is up and to the right of mainstream adoption.
If you believe in that story, then carbon removal might be in that trough. You’re like, “All right, if we can just hang on, mainstream adoption is coming. And we know that is true, and it’s gonna be okay.” I hope that’s the story that we’re in. It’s also something that can be very misleading, because we aren’t necessarily in that story. Rudy and I go through a bunch of other story alternatives that we could be in that lead to different kinds of outcomes.
I wanted to make a connection here to literature and film that I was thinking about so strongly in making this. So with expressive art and with most media, for most of the history of human storytelling, most stories do not acknowledge that they are in a story. You would find it very strange if Beowulf spikes the camera and says, “This would be so strange if Grendel were actually real. I mean, monsters aren’t real because this is just a mythology that we’re telling each other around the campfire, right?” That doesn’t quite happen.
There are some early stories in the Western canon that point to an awareness of story. There’s a term for this called hanging a lampshade, and Shakespeare has this in Twelfth Night. The line is, “If this were played upon a stage now, I could condemn it as an improbable fiction.” Famously, that’s called hanging a lampshade, where the writer acknowledges that this is a little much. I understand.
Or there’s things like in Don Quixote, which I did an episode about, how Don Quixote was written in two parts in 1605 and 1615. In the second part of Don Quixote, the first part of the book has already been circulated in that universe and people are now imitating Don Quixote. They are also pursuing knight errantry in an anachronistic, goofy style. And they also know who he is and are setting traps for him to play jokes on him. And that’s a very funny thing, and it acknowledges that literature and writing and created media exist inside of the universe. It’s aware of itself as a story, even as it’s within the story.
It’s much more common now, and it’s strongly associated with postmodernism, and in the broadest sense, an attempt to deconstruct media and narratives into pieces. And part of dismantling a story is noticing that the world is made of stories. We ourselves are made of stories. Sure, you’re made of flesh and bone, but how you think of yourself, how you understand yourself in this world is entirely story-based. Stories make the world. In fact, the world itself is a story, because we also have the word Earth, and world connotes so much more than mere Earth does, right? Earth as a story connotes a scientific understanding of a planet. World connotes something that you live within. It’s different. Words matter, and the stories that we tell really shape how we view things, how we act, and what we value.
Some of my favorite fourth wall breaking, the fourth wall is the screen or the stage. Some of my favorite fourth wall play, pieces of art that I’ve loved. I think the first ones I saw as a kid, the first one has to be Monty Python and the Holy Grail. Something about them being arrested for murder at the end of the Holy Grail because the historian was attacked in the filming and the cops are chasing down King Arthur and the Knights of the Round Table, it isn’t just something that is happening mythologically or in the past. It turns out these are just crazy people from the present who now need to have modern police arrest them because they are causing havoc. There’s a whole world, a parallel world of people who are mentally unwell that are roaming the English countryside clapping coconuts, and not only attacking one another, but also defending castles and speaking French. And a whole thing is happening here that the police need to get involved because there’s something bad brewing.
To me, as a kid, that was so genius because at the end of Holy Grail, they’re setting up for a climactic battle that’s going to take place, and before they get there, they’re carted off by the police for homicide. That so tickled my brain that it made a huge impression on me for story.
Another one that did that for me was Blazing Saddles. In the climax of Blazing Saddles, they are on the Warner Brothers lot. They go into a Busby Berkeley musical set. They end up at the movie premiere. The movie within the movie that’s aware of itself as being a movie. It just bursts out of the movie itself, and it’s one of those moves that it’s very common now, but when it happened, I imagined it was like, “Are you allowed to do this?”
Woody Allen is also very famous for fourth wall breaking. On the Diana Pasulka show, we referenced the very famous scene of Marshall McLuhan chastising someone for misunderstanding his work in line at the movie theater, and Woody Allen’s always addressing the camera.
And if you fast-forward all the way to now, there’s many films that play with our awareness of how plot and act structure work. One of the biggest examples more recently than any of those other films is Stranger Than Fiction, where Will Ferrell plays a character inside of a story that the author is writing, and his rebellion against the author from inside of the story. It adds a fascinating set of philosophical questions here about is the world a simulation? Is there a God? Is there determinism? Are we predestined? What controls our fate, and how much do our choices matter? And it invites those questions if you’re willing to entertain them.
And that’s all to set us up for perhaps the film that does the best treatment of this that exists. I’m gonna skip Cabin in the Woods, which also does really impressive postmodern work on this. But the one that I come back to over and over is Charlie Kaufman’s Adaptation.
In Adaptation, the character that is Charlie Kaufman, played by Nicolas Cage, is a successful but very anxious screenwriter. Being John Malkovich, which is his film in real life, is being filmed during Adaptation. And he already has his next screenwriting job, which is to adapt a book called The Orchid Thief by a New Yorker writer named Susan Orlean. And he is struggling with it because the book, he finds it to be beautiful. Somehow I am blown away that I have not read this, because it seems like the kind of book that I would. But the book is lyrical and beautiful, but it’s not very plot-driven. It’s a character portrait of this orchid poacher who’s played by Chris Cooper in the film.
And essentially the whole first half of the film is Charlie Kaufman grappling with how do you take a story that’s about a flower and about the deep history of the evolution of the orchid and the world of those who care about exotic flowers and turn it into a structure that our minds enjoy as an entertaining story that suits a visual medium like filmmaking? And Charlie cannot do it. He notes that so much of this film is about beauty. It’s visual, but it’s non-narrative, and not a lot happens. And in fact, life is full of a lot of things not happening. A lot of life is anxiety and disappointment and suffering, but without some grand climax that happens here. There’s a sense that not a lot happens in life except for quiet moments of desperation and struggle.
While Charlie is trying to do this, he has a fictional twin brother named Donald, also played by Nicolas Cage, who sees the success of his brother Charlie and comes to Los Angeles trying to become a screenwriter as well. And Donald picks up the Robert McKee book called Story, which is a really classic and a good book on screenwriting that I’ve read and learned a lot from, and is going through a seminar with him trying to understand how do you produce a script that will sell, that can be turned into a movie format.
Charlie is struggling desperately to write this film about orchids, and Donald meanwhile is loose, not that intelligent, seemingly just kind of a goofball, but is able to just put together a script that I believe he goes off and just sells, which is something that Charlie is jealous of, given how much suffering writing causes him. And it especially bothers him because he’s trying to make something that is true and beautiful, and Donald just wants to make something that’s commercial, that will sell, and Donald just pulls it off and does it.
Up until basically the midpoint of the film, we’re all in Charlie’s point of view. It’s all about a place where our lives unfold from us without much dramatic action at all. He asks Donald for help with his script, and as soon as he does, the film that’s meant to be a true reflection of life’s small moments and anxieties turns into a sort of summer blockbuster tentpole action film where the orchids are like a stand-in for drug running, and there’s murder, and Susan Orlean is having an affair with the Chris Cooper orchid poacher character. And Charlie and Donald end up mixed up in this chase sequence in the swamp, and there’s murder, and the film is essentially about not knowing what kind of story your life is in.
Your life can be one of small moments of anxiety and terror, existentially speaking. It can also be one of the plot points of an action film that feels dramatic, that hits all the highs and the lows in a way that is satisfying to retell. And there are times when you might be in one story, and there are times when you might be in another. And in fact, asking or inviting a new story in this kind of way can change your understanding of yourself and which story you are in and how that shapes your actions for how to proceed.
If you don’t know what’s coming in that film, I imagine it would confuse you, because you’d be watching a film about neurosis and all of a sudden it almost has like a heist or an action film kind of feel to it. And you feel like, “What the hell? What was that whole first half about? Why did that exist?” And that’s such a funny, brilliant use of story. And it changes as soon as he asks Donald for help with his screenplay.
What Rudy and I are trying to do in this show is something similar. Carbon removal has a bunch of available stories to it. The hype cycle story is one. A lot of people like to point to the solar cost curve story about how solar came down in price, and is carbon removal enough like that to have that same kind of story arc? Believing in a story could help create that story in reality, but it can also be deeply misleading.
Some of the writing that I see about carbon removal policy or what can be done, I occasionally experience as frustrating, because it feels like it’s playing by the rules of a world that hasn’t existed for several years at this point. There’s still the people who write some of these articles, it feels like they are living in a story that the world returns to normal after the midterms or after the next presidential election. Is that a true story? I don’t know. I think them behaving as though it is a true story can be hopeful. We can actually return and make things better and not continue down the path that we’re on now. Alternatively, it could be delusional. They could be telling us a story that is no longer relevant, that could prevent us from coming to grips with the true state of where we are as an industry, as a country, as a world, and being misleading in this way can be dangerous. It is impossible to give good advice except by accident if you do not actually understand what is happening in the world and how it impacts you.
So which story is carbon dioxide removal inside of right now, and how can we change it? I think it’s as simple as asking carbon removal’s Donald. Just finding some way to recognize the truth of where we are and trying to see things in a very clear way. If we are made out of stories individually, as a family, as a nation, as the world itself, we need to recognize that and make sure that we’re telling the right kind of story to create the conditions that will lead to our flourishing, to our happiness, and to a world which is not so frequently imperiled by our decisions and our actions.
That’s where Rudy and I go. I think that’s enough of an intro for now. Go watch Adaptation, it rules. It’s one of my favorite films of all time. Thanks so much for listening. That’s a little bit long for an intro. Hopefully it was worth it for you. I think it was fun. Thank you so much to Rudy for being on the show. Really respect his work and his mind. If you’d like to get in touch with Rudy, his info is in the show notes to do so. Thanks so much for listening to this intro. Here is the full episode with Rudy Krehbiel.
The episode
Ross Kenyon: Rudy, you’re here. Did you even believe this time would come?
Rudy Krehbiel: I knew it would come eventually.
Ross Kenyon: You would come eventually?
Rudy Krehbiel: Did you have doubts?
Ross Kenyon: No, I did not have doubts.
Rudy Krehbiel: We were just waiting for some news, right? Something interesting to talk about.
Ross Kenyon: Is there news or interesting things? You just alluded to some. What is there to be doomer-ish about? I was trying to think.
Rudy Krehbiel: I can’t keep up. I guess it just depends on where you’re approaching things from.
Ross Kenyon: The OpenAI accent. Something else.
Rudy Krehbiel: Are we talking rabbit holes or are we talking carbon markets these days?
Ross Kenyon: I don’t know. Well, I guess let’s set the stage here and let’s figure out which bucket those stories fall into, because we connected on this sort of meta question of which stories are being told about carbon dioxide removal and carbon markets and climate change, and which ones are we actually in, and which ones pattern-match enough where people get misled by them and fall into a story that is a sort of faux ami, if you studied French. Things that look like the cognate but are actually not. Are we actually falling into pattern-matching that... Our brains are so good at pattern-matching that they sometimes are so good that they match ahead of when they really should. So what’s happening right now? Where are we in it?
Rudy Krehbiel: Amen. There’s a lot to unpack there, but I think for me, first thing that comes to mind is this idea that maybe we’re in a bit of a lull, or this period of... I know a lot of folks are feeling a bit kinda disappointed with some of the recent developments in the market. But I genuinely think we’re much earlier in CDR in terms of adoption than we like to think that we are, that we might feel, right?
I think we’re definitely still at this innovator stage of market development. I came into CDR with a background purely in startups and venture capital, right? And studying a lot of these adoption curves and diffusion frameworks. And so I was always kinda looking at things through that lens. And when you look at CDR right now, there’s a lot of interesting things you could take away. But to your point, I don’t know how much of it’s real, right?
So you’ve got Rogers’ diffusion of innovation, where he’s talking about innovators, early adopters, early majority, laggards, that kind of flow. And then you’ve got Moore’s Crossing the Chasm, where he’s talking about how early innovators are gonna tolerate a lot more uncertainty, whereas mainstream customers are really gonna demand a lot more evidence, and they need references and standards and predictability and all this stuff. Really, they wanna see demonstrated success before they dive in, right? And then you’ve got Gartner and the hype cycle and the trough of disillusionment, and I think he would argue that a lot of today’s market dynamics, maybe if you perceive it as disappointment, I think he might think that a lot of that is actually an inevitable correction from a lot of the expectations that we set for CDR dating back five, six years now.
But the reality is, we still sold less than 50 million tonnes. Maybe we’ve crossed the 50 million tonne threshold. Less than two million of those tonnes have been actually delivered. We still have a lot of market concentration with Microsoft and Frontier. And you can even look at biochar, which seems to be taking on a bit of a life of its own. But at the end of the day, excluding Microsoft, the average or the median purchase volume there is still less than 100 tonnes. So none of this, to me, are characteristics of a mature market. They’re very consistent with what you see from a small number of very motivated innovators, in this case, the Microsofts of the world, right?
And we’re still in experimentation mode, and we’re learning, and most of us are still tolerating a high degree of uncertainty. And these early innovators are effectively kinda subsidizing this market formation. At least that’s how I see it, right? And so I worry that we sometimes confuse some of this early adopter activity as evidence that the early majority’s kinda gonna come flooding in. And I don’t think we can count on that. I think there’s a lot more to the story than that, right?
And so what I think a lot about and what we think about at Eco a lot right now is, if we misdiagnose some of this early market activity that we’re seeing, if we misdiagnose that as failure, we’re gonna start prescribing the wrong solutions, or getting oriented around the wrong problems, right? And with all that in mind, what I’m trying to say is that I don’t think carbon removal is failing. I don’t think it’s necessarily super behind schedule. I just think our expectations are kind of out of alignment, right? And kinda leaped over the realistic adoption curve, or realistically where we’re at in terms of market maturity.
Ross Kenyon: There’s so many good insights in there, Rudy. Thanks for bringing this up. There’s something about all of those charts, and especially the hype cycle chart, the ideology of that image is very much that what you’re looking at is in fact inevitable.
Is carbon removal inevitable? I don’t think you could say that it’s inevitable, but the chart shows that this thing is going to happen, and it’s going to go through a cycle, and it’s going to go through a period where it looks like all is lost, and then eventually it is going to win. Some part of you has to believe that in order to bet years of your life on this working out and to work on this, and humanity will be much better off should it invest in carbon dioxide removal and make this work. But also that story has a little bit of that hyperstition feeling to it, where you’re willing something from the future into the past to create it in the present kind of thing. But also it’s not inevitable. It’s an idea. We hope it’s inevitable. Is it? Does that mislead us, or is that a useful fiction that we have to believe in order to do this work successfully?
Rudy Krehbiel: I would love to think that it’s inevitable and obvious...
Ross Kenyon: I hope it is.
Rudy Krehbiel: ...and I think that line of thinking will serve you fairly well as an operator in this space. But I think what folks overlook and what’s really missing whenever you see those curves brought into the discussion, particular to CDR, is this... I know you love this concept, but the idea of a public good, right? And the different dynamics that creates when you’re thinking about adoption, right?
And I think CDR is a public good. We can talk about what that really means. But I think the most important takeaway when you think about a public good is the idea that there’s gotta be some trust behind it from the public, right? It needs societal backing. It needs broad support beyond industry operators and business community, right? For public good to really get the funding it needs to be successful, it needs to catalyze support on down the line.
And I see these adoption curves come up that make it seem obvious, but they’re often compared to solar and electric vehicles and batteries, right? Especially here in the southeast, we love to talk about cleantech and climate tech, and it lumps in sustainability with energy, with carbon removal and carbon credits, right? And I think we need to be very clear that the comparisons between CDR and these other innovations break down really quickly when you think about the value, right?
You’ve got electricity from solar, you get transportation from EVs, you get energy or deferred energy from batteries. And you hold up a counterfactual, right? If climate change didn’t exist, would anybody still buy this stuff? And the answer is yeah. There’s still a lot of value to having an EV outside of the climate benefit. Same for batteries and solar, right? But it’s really hard to say the same thing for CDR, for carbon removal in general, right?
We could talk about co-benefits, and we could talk about clean air, and there are other benefits to it. I’m not saying there’s not. But if we’re thinking about it from an impact perspective and the core product being a tonne of carbon removed, that’s not value that most people either at an individual level can wrap their minds around, or a company can wrap their mind around.
And we could talk through all the things that make it that way, right? It’s diffuse. The benefit of a stable climate is for everybody. It’s delayed or intergenerational. A lot of the time we’re trying to get people to buy something where the people that are gonna get the most value out of effective carbon removal haven’t even been born yet, right? And all these different dynamics, the non-exclusivity, so the people who don’t pay or don’t support carbon removal are still gonna benefit from it.
When you look at it through that lens and then you think about how we’re gonna ask individual corporations to incur this huge cost that’s very public and in some cases it is political in this case, right? We’re asking individual corporations to spend cash today for a benefit that is generally gonna accrue well beyond their walls. They’re not gonna be able to capture it. I think it’s kind of a crazy idea, right, for the voluntary carbon markets in general for that to be the plan. It didn’t seem crazy at the time, but it’s starting to seem more and more crazy.
But my point is, this is just way harder than electrification, right? This is arguably the hardest public good we’ve ever tried to fund as a society. I sometimes think about it as, CDR and carbon removal...
Ross Kenyon: Mm-hmm.
Rudy Krehbiel: ...our success is gonna be measured by futures that don’t occur. We’re trying to sell something like, yeah, your crop yield is gonna be marginally better because drought conditions are gonna be marginally worse, right? Or that hurricane may not hit, or it’s gonna be less volatile than it would if we hadn’t removed it. That’s just such a crazy idea to me, that that’s what we’re selling, is largely things that aren’t gonna occur if we do this right.
And so yeah, not only is it a public good, I think it’s one of the craziest or hardest public goods to fund. And to me, that means no, I don’t think this is inevitable. The missing link to me is this underpinning of support from society, right? You need this catalyzing force that’s gonna help institutionalize this stuff and legitimize it and make it real. To me, again, I’d love to think it’s inevitable, but you think about how far we have to go in terms of generating that support. We’re convincing folks that climate change is real. I’m not sure we’ve convinced folks that carbon removal is the solution. So to that end, I think it’s tricky, right?
Ross Kenyon: Thing with your comments, Rudy, is every one of them sends me with seven different ideas that I have to be so selective now about what I even say. Okay, well, maybe most immediately, that question for individual people or for corporations is so hard. It’s hard for governments too to wrap their heads around.
One, the avoiding a problem is already harder than some positive benefit. You could frame it in terms of we are buying ourselves a healthier future. It’s also avoiding a bad negative possible future. So maybe that’s a framing issue, a communications issue.
That’s not even the hard part though. The hard part for me is everything that touches net present value calculations is just impossible. You’re like, “Okay, a dollar today is worth more than a dollar the day after,” and then two years away, five years away, at some point it equals zero. The calculation for discounting at some point, future revenue or benefit, is just negligible. You can’t even count it.
It’s true for politics too. Politicians can’t necessarily, if they’re running for re-election, promise that 15 or 20 years from now they’re going to have a much better energy system and their kids are gonna be safer. I think people are concerned with prices at the grocery store and the gas pump today. That’s what they care about. And that makes these kinds of planning, especially if there’s the avoidance of some possible outcome that half of the population isn’t sure that they even fully believe in. You’re like, “That’s oof.”
All right. Five of the other ideas I’m gonna go through really quickly here. Thank you for using public goods correctly, the non-excludable, non-rivalrous part. We talked about this previously. One way you can solve that is you can make it microeconomic and you can just try to make a way where corporations can internalize the marketing value so it’s no longer something that’s non-excludable. They can benefit from doing this action and therefore they get paid, so to speak, in terms of their brand equity and reputation. Maybe. And I’m sure that’s part of what’s driving it now, but it isn’t doing enough as is.
Several other things here. Okay, the stories part of this. Moore’s Law is a story here too, that chip sizes will keep getting smaller and smaller. We’ll be able to add more transistors to them. They’re gonna keep getting more powerful. Compute will just keep getting cheaper and more available in this way, and that’s turned out to be true. But that plus that solar scaling story sometimes get applied onto carbon removal and hard tech problems, because Moore’s Law is a thing of, obviously, there’s a software optimization part of this, but a lot of it is hardware design, and it is getting better over time, and very rapidly, too. And solar has also done this thing where it’s, oh, a long period where it’s super expensive and kinda clunky and doesn’t work, and all of a sudden, the benefits of compounding means that, boom, it’s cheaper than everything else for levelized cost of energy or very nearly so.
Is that gonna be true for carbon removal? What would have to be true for it to be true for CDR? How do you know this model is not just misleading us? Or Moore’s Law, “Oh, every such and such months it doubles in power.” Okay. Is that going to happen with DAC sorbents? Do we have any reason to believe that that is going to apply to this thing, or is it just a nice shape and we want it to be so? What would it take for any of these things to be true and not to be wishful thinking?
Rudy Krehbiel: I was trying to think of a really clever substitute for the chip in this setting. I don’t know what that would be for CDR.
Ross Kenyon: Sorbent is what I reached for. I’m like, “What else could it be?” I don’t know.
Rudy Krehbiel: If you can come up with one that applies to more than one pathway, I’ll be super impressed. But look, I don’t have a silver bullet for this whatsoever. I do get to think about this a lot though, and you’d mention microeconomics and these... I think on one hand they’re strategies, another hand they’re kind of like forecasting tools.
But I think of them through, again, the venture lens and I think of how we measure progress, right? And how do you balance commercial success with impact. And I think it gets very nuanced and very complex when you’re trying to understand what’s driving things forward, right?
And I think expectations have a huge impact there. We talked about expectations a little bit, but the way I think about it is a lot of time expectations really shape incentives, right? So in our case for carbon removal and climate tech, we have to consider venture scale expectations that have been imposed on our market, right? So these expectations are placed in our industry, in our market, particularly from where investment’s coming from and what stakeholders feel like success looks like, and it really goes a long way of determining what we optimize for as an industry, right?
But what makes carbon removal so interesting to me is this kinda dynamic that we have on one hand, like real urgency from a climate perspective. We need gigatonnes, and we need them yesterday. We need to produce these faster, right? And I think that is at the heart of what’s driving a lot of folks in this industry. But at the same time, you have venture economics that say that you need to demonstrate exponential growth, drive down costs, scale quickly, essentially create value, enterprise value.
And I don’t think any of these views are irrational. But I don’t think any of them have a real impact on that underlying diffusion curve that we talked about, right? So what I’m saying is these expectations that have now become incentives for our market may not be driving us entirely towards the overarching goal of getting massive support for carbon removal.
So you see today, we talk a lot about success. It looks like raising more capital at a high valuation, tonnes contracted, deployment capacity, declining cost curves, like you said, speed to issuance, all these things that we can measure in a commercial setting, right? And that’s what investors are looking for. And so companies are very rational in optimizing for all of those outcomes. And I also think they’re all super necessary, right? Well, not all of them, but most are very, very necessary. We need capital. We need lower costs. We need deployment. And eventually, we’re gonna need this massive scale, and that’s today with the underpinning of venture support. That’s what we’re largely trying to optimize for.
But my big question when I think about this is, is there a case where we might be optimizing for some of this stuff a bit prematurely in a way that causes us to maybe skip over some of the necessary work, the stuff that’s necessary to create the conditions by which this giant scale becomes possible?
So I’m not saying VC is bad. I’m saying that venture scale expectations might not be the most appropriate operating system to kind of build this industry on, right? In my theory, the success of CDR depends on collective action and society buy-in. Again, I don’t know if the venture model is the most appropriate fit.
And so I think what we’re seeing today is, as VC capital in particular is becoming more and more scarce, that doesn’t change. If anything, founders become more responsive to investor needs and way more dialed in specifically on milestones they need to hit to get more capital, right? In some cases, I don’t have any evidence, but sometimes it feels like that kind of scarcity that we’re going through right now in terms of capital and funding, sometimes I feel like it incentivizes folks to maybe double down on this appearance of scalability, when in reality, I think it’s more important now than ever that we’re focused on evidence-backed impact and credibility of the institutions that we’re building and credibility of the operators. And that’s a lot different than optimizing for returns and showing that scalability.
So again, I’m not trying to say VC is the problem, but I do sometimes wonder if we might have jumped into this all-out effort to kind of build a VC-backable market, when in reality, again, I think ultimately success is gonna depend on this whole other world of getting mainstream buy-in, if that makes sense.
Ross Kenyon: Yeah, it does. It’s making me think, I’ve never applied this so neatly to the investment side, but if you are a company and you’re trying to receive investment, it’s just another way of doing customer discovery and the sales process. It’s just a different direction maybe of it.
The old line for this, Rudy, I’m sure you... I don’t know how many times you’ve heard this, but I can imagine it’s maybe three digits, but your first customer determines your product roadmap, at least for the first amount of time. And if VC is your first customer, technically they are gonna determine your roadmap, and the story that they impart to you is going to be very different. It’s going to be about how do you get to scale? How do you become a unicorn? How do you actually make this work on a timeline that fits inside of the 10-year VC funding model? If the incentive is to wrap what you’re doing inside of a story that is appealing to this particular customer, people are gonna do it.
Is it actually the best story, or is it just the best of all the available options? Do we just need to do that in order to raise money for one’s company to exist at all, come what may? And I think a lot of people find themselves in that position where maybe they wanted to have a company that fulfills government contracts and is not necessarily focused on delivering multiples that justify a venture fund. Maybe that’s not actually the point.
In fact, I think many of the people who work in biochar do not have the expectation that they’re gonna be able to justify a venture fund. So at least they don’t have the burden of illusion placed on them. There’s not a lie or a shape that is unnatural. They’re not finding themselves living inside of a story that’s not appropriate. Where I imagine some people who are doing hard tech technology development in CDR or adjacent fields think they’re a venture backable company. The investors might have even thought they were venture backable, and then everyone is maybe realizing over time that many of these stories that have been imposed upon this reality do not fit that shape very well, and it’s uncomfortable. That’s fairly speculative, somewhat abstract and meta, but I think that’s at least partially relating to what you’re explaining here.
Rudy Krehbiel: Well, I think a lot of folks that dive into this space might have a deep climate background, but maybe not as deep of a business or a company building background. And I know...
Ross Kenyon: Are you serious? What? That’s crazy.
Rudy Krehbiel: ...for the sake of my example here.
Ross Kenyon: No, I think you’re...
Rudy Krehbiel: No, it’s like... But I guess I...
Ross Kenyon: Flavor. I got you.
Rudy Krehbiel: I don’t think that was necessary to call out the nerds like that, Ross. But I think...
Ross Kenyon: It’s true. People are here because they’re oftentimes scientists and engineers, and they care about climate. They’re not necessarily hard-nosed businesspeople looking for the best opportunity, because you would not be in climate tech, certainly not still, if that’s what you cared about.
Rudy Krehbiel: There’s so many easier ways to make money, Ross.
Ross Kenyon: Tell me what they are sometime. I would love to know what they are, but yes, I’ve heard about them. Sounds great.
Rudy Krehbiel: Uh...
Ross Kenyon: Is it writing on Substack? Is that what it is? Okay. Yeah, good.
Rudy Krehbiel: There’s a lot of writing on Substack maybe.
Ross Kenyon: There is a lot of writing on Substack.
Rudy Krehbiel: Well, I guess my example I was gonna use applies to both. So you’ve got the nerds of a particular variety, either on the science climate side or on the financial side, but I think the science climate people... It all comes back to this idea of, the first time you have that conversation with a capital provider of any kind really, where it’s becoming increasingly clear that they really don’t care about anything else that you’re doing besides what you’re doing to generate revenue and make this a bankable or financially backable operation, right?
So even that first check is gonna be dependent on a lot more folks diving in, and so he’s keenly aware of what you’re doing and how attractive is this gonna be to my network of investors who are ultimately gonna make this successful, right? So every founder or early startup is gonna have that realization that regardless of the impact you’re having and what you’re trying to build, you’re gonna have stakeholders, critical stakeholders in your camp that are just hyper-fixated on cash and revenue, and I don’t think that’s a bad thing. I think to be successful, every business needs that influence, right?
But what makes carbon removal so interesting to me and unique here is that you’ve got that layer, right? And you can de-risk your operation, your business to make it more financially backable, right? So financial de-risking is all about making this something that other folks can invest in, and so we can scale it.
And then you go to sell, and you realize that your buyers of your credits are worried about some set of risks that are totally different, right? They’re in there asking, “How do I defend this purchase?” “How do I talk about this publicly?” And so all of a sudden, as a founder, you’re like, “Okay, now I have to learn to think about it through the buyer’s lens and understand their risks,” and that gets very complicated when you start talking about Fortune 500, Fortune 100 companies and their set of risks. It’s a massive set, right?
And so then you have this third bucket, which is society’s confidence in carbon removal, which again, I think is overlooked in most of these contexts, but I think about it a lot. You’ve got the financial de-risking that you have to do. You’ve got the buyer de-risking that you have to do. And then you have this whole underpinning layer of folks that we need their support over the long term, and they need to believe that this stuff actually works, right? They need to believe in these pathways, that they’re effective. They need to trust the institutions that we’re building that govern all of this, right? And ultimately, we have to convince them that carbon removal deserves collective support.
And so while the financial risks and the buyer risks and the societal risk, they are related, but they’re not the same. And for me, the way I’m looking at it today, when you kinda look at it through these three lenses, there’s a case where we’re doing everything right as an industry, right? We might be hitting all the marks and really advancing technically. I’m not unnecessarily pessimistic about CDR today. We have better science, we have better MRV, better methodologies, more data, more experienced developers. We’ve gotten better at verification. There’s all these advancements, especially in the last six years that I’ve really been involved here, right? That’s real progress.
But does all that progress actually produce public confidence? That’s where you have to take a really critical look as an insider in this industry and think about what we could be doing better, and also be super mindful about how we talk about ourselves and our peers, right?
As an outsider looking in, a lot of that technical progress, to an outsider kinda looking in, and I see this with folks that have just started in CDR. I do a lot of mentorship. I try to do some coaching and I love talking with folks that have just entered into this wild world, right? And they read an article and they’re like, “Oh, this methodology isn’t very good, huh?” Or, “Those credits shouldn’t have been issued,” just because one person wrote it, right? And really what they’re seeing is, in my mind, it’s progress, right? That criticism is scientific progress at work. How and the way we deploy it, that’s up for debate. But what this person’s observing in my mind is progress and advancing, and to them, it just sounds like, “Wow, even these guys that have been doing this forever, they don’t even agree on whether any of this stuff works,” you know?
And so it’s easy from an outsider’s perspective looking in if they look at all this discourse, to be like, “Man, this entire industry is super unreliable. Look at how diverse these opinions are.” And I think what is the most fascinating part about all this is, there really could be a case to be made here that all of the technical progress, while we’ve made tons of progress, we could be simultaneously losing confidence from outsiders, from society. The more we bring this up in terms of transparency and the more debate we have, we actually might be eroding some confidence that we desperately need, and that’s where I...
I’ll stop rambling aside, but that’s also what I talk about, like consensus versus convergence. You can’t manufacture consensus. It doesn’t work in this space. It doesn’t work in most cases, in my opinion. But what we need is convergence, and that’s agreement across an industry. Less competition and less company to company, pathway to pathway, registry to registry. All that competition, I think we can do better as an industry in harvesting the value from that in a way that we converge on some value and really make this space more defensible versus creating this illusion of utter chaos. Maybe it is utter chaos. Maybe I’m optimistic about all of...
Ross Kenyon: Chaos is a story too. And it’s useful in some cases too, the story of entropy, things fall apart, and it’s just madness here, and we’re all mad. Cool, you can tell that story, and there are times when it’s the appropriate story to tell.
There’s several other stories that I thought of that maybe apply here and maybe don’t. Oh, do you wanna react to the Alice in Wonderland? No, you’re good. Okay. I could see you having been the Mad Hatter for Halloween one year, by the way. I could totally see you pulling that off. Maybe that’s this year for you. I think I’m going as Grandpa Joe, just so you know. I think we’re going Willy Wonka style. I’m doing the haven’t gotten out of bed in a while. That’s me.
Okay, anyway, stories that we could tell. So one story that you’re referencing here, it’s the famous Captain Picard line that it’s possible to do everything right and to still lose. And that’s true. I mean, the world is a game with variance. You can play it with perfect skill and randomness can still work against you in the same way that cards do, or backgammon, like a roll of the dice do. Those things have variance. You can be the most skilled player and still lose. It’s different from chess in that way, right?
And also there’s a story that you’re telling about progress, and there’s a sense that people are criticizing by creating another story here, the MLK line of “The arc of the universe is long, but it bends towards justice.” It’s like we are always approaching, maybe asymptotically... What’s that, sorry? What?
Rudy Krehbiel: Peace up, A-Town down.
Ross Kenyon: A-Town down, yeah.
We are approaching a better union. We are becoming better over time. I made a show earlier this year called How Carbon Removal Loses, and it was about watching the populist right wing in Europe and Canada and the US and being really concerned about the AfD in Germany. Even as recently as this week, big news out of Germany where they are blowing out their rivals in an election in eastern Germany. National Rally’s expected to do very, very well when they have their next elections coming up next year.
Is that part of the CDR story? Because the CDR story is that we are forever approaching compliance. We are in a pre-compliance moment, and compliance is in the future, and it is coming. But it assumes that we become gentler, more progressive in a good way over time, more tolerant, more eco-conscious. But it turns out the world, the story that we’re telling ourselves and many people want to believe in and thus are creating by their belief, that we need to be meaner, tighter, lock everything down, or we’re not gonna be able to take care of our families in this way. The world is not necessarily becoming better.
For historiography, one of the main theories that people love to beat up on this theory. You’ve probably heard of it, the Whig theory of history or Whiggish theory of history, and it is one of perpetual progress. It’s sort of like an 18th and 19th century, enlightenment and romantic idea of history that we started off as warring tribes. Of course, the true story of that is more complex than is often presented during this time, and that civilization is a process of moral improvement, and we’re getting better all the time, and things in the future are gonna be better for sure.
It’s possible things in the future are worse, and Americans especially have a hard time with that. We do not want to believe that’s true. Other parts of the world have a cyclical theory of history. It’s a better story for understanding there’s times of contraction, there’s times of growth, there’s times of death, there’s a, for everything under the sun, there is a season kinda thing. Cool. But for Americans, that’s super hard.
But CDR people, I think there is a Whig theory of history with regard to compliance. Europe is gonna save us. We’re gonna have a market here that’s going to... Really? Is German procurement gonna survive if AfD blows everyone out in landslide elections in Germany? My guess is that’s the easiest thing in the world to cut. Are we ready to talk about that openly? No, because it’s really, really scary and would reverse all of the stories that we’ve been telling ourselves about where we’re pointing.
Those stories have a political economic component to them because you probably told your investors on investing in your last round based upon integration into a compliance market that may be fundamentally undermined by right-wing populist electoral demographic changes. So now what? Are we living in a fake story? Are we just living in denial and cannot admit it? Is that story still true? Is the world just made of stories? Is there anything except stories is ultimately what I’m coming down to.
Rudy Krehbiel: Yeah. It’s mostly stories.
Ross Kenyon: Sorry to do this to you, Rudy. Sorry. You knew what show you were coming onto though. You knew, but this is it.
Rudy Krehbiel: Yeah, no, I love it. I’m here for it. It’s why I tune in too. Look, you made me think about... Well, I think about timelines a lot, right? And the pace of change, and this is a weird example of where government is probably gonna act faster than the advancement of climate, right? I usually don’t bet on the government acting fast, but in this case, we’re talking about, in my opinion, negative changes in the government. Those seem to happen pretty quick, right?
Ross Kenyon: Sometimes they do, yeah.
Rudy Krehbiel: And I also... Sounds like you’re telling me this is a bad time to try to fund a public good, is what I’m hearing. Maybe one of the worst times to try to fund a public good, which is a sobering thing to think about. I just spent the rest of this podcast pitching on why we need to focus on that front, and yeah, I think you made some pretty compelling arguments on why it might have a very low likelihood of success in the near...
Ross Kenyon: I want my story to be wrong, by the way. I’m living in a story that is kind of doomer-ish, and I think some of it is true enough to say publicly, but also I don’t want it to be true. It sucks. It’s a bad future. I do not wanna be creating that future. Please continue, but yes.
Rudy Krehbiel: It was interesting. So I was in Montana for a wedding last week, and I was talking with some folks, and they were asking me about what I do for work. And I, you know, this guy kinda conveyed some conservative values. If I had to guess, I’d say probably voted Republican and whatnot, and things that would traditionally make me think this guy’s probably not super supportive of government action on climate.
But he said something really interesting to me. He said, “Is this kind of like a right side of history thing for you?” And I’d never gotten that question or heard it put that way. And I know folks...
Ross Kenyon: Derision at this point too.
Rudy Krehbiel: Sorry?
Ross Kenyon: I said usually that’s a term of derision because I feel like the right feels like for gay marriage and other things, the left bludgeoned them with, “You’re gonna be on the wrong side of history,” for segregation and stuff like that. And so I feel like they don’t like that as much. But yeah, go ahead.
Rudy Krehbiel: But I kind of thought it was a positive thing.
Ross Kenyon: Maybe it was. Yeah.
Rudy Krehbiel: If we’re getting this type of engagement with traditionally what I would consider folks that just didn’t have the time of day to even worry about this kind of thing and write it off as not worth their time. So I saw it as, oh, this is kinda interesting that you’re thinking about it that way, which to me implied that there is a growing sentiment that climate change is a real risk and it’s something that creates a huge threat to the livelihood of people regardless of your political affiliation.
And yeah, when you’re out in Montana, there’s a lot of the libertarian mindset, but there’s also this deep respect for the land and for nature. And so it was really fascinating for me to hear that kind of creeping into the small talk that you make about your work and stuff. To me, that was a big positive.
But I share those same concerns. I get even more concerned though when I look at some of the predictions around El Niño and where some parts per million of any variety of greenhouse gas skyrocketing in the last two years alone. My concern is, I think the next five years are gonna bring some of these impacts of climate change to a lot of people’s doorsteps that haven’t experienced that.
I know I talked a lot about how we’re selling a future thing, we’re selling the avoidance of a bad future. But I know folks talk about that a lot, right? It’s kind of a tired narrative. Once people start to feel climate change, they’re gonna dive in and wanna fix it all. I’m not saying that, but I think it’ll be a really interesting kind of collision of socioeconomic and political momentum in one direction and then the day-to-day lived experience of everyday people around the world. It could go a lot of different ways, but it does look like it’s gonna be pretty gnarly on all fronts.
Ross Kenyon: Yeah, I think a lot of people are probably gonna react to climate change and El Niño and things not going very well with microeconomic responses, which is that they buy air conditioning, or they insulate their homes, or they move. I don’t think they’re necessarily gonna say, “And then we should spend a lot of money that’s hard to see the direct impact.” To me, I think they’re gonna try and concentrate the benefits where they can internalize them, which is their home, their family. And obviously, if everyone does that, then we adapt successfully to climate change to some extent. But the goal is not only to do that. We could avoid a lot worse harms if we actually mitigated it. I hope that’s what’s happening.
But I came from libertarian and classical liberal stuff a long time ago, and a lot of people I know from that world... Have you ever seen the living with a narcissist copypasta? Do you know what this is?
Rudy Krehbiel: I know what you mean, but I did not see that.
Ross Kenyon: It’s like the script, if you’re dealing with a narcissist, it’s like, there is no problem. If there is a problem, it wasn’t my fault. If it was my fault, it wasn’t that big of a deal. If it was a big deal, it actually... It just goes and goes. There’s never responsibility being taken.
And some of the people I know who started off maybe 10 years or 15 years ago that were skeptical of climate change even being real, they’re just sort of like, “Okay, it’s real, but the government’s not gonna be able to fix it. Maybe we’ll have private solutions and technology will fix it. Oh, if that’s not happening without enough government intervention, then actually it’s going to be good for agriculture in the high latitudes, and maybe on net it’ll be good, or we can just focus on adaptation and see...” And it just keeps going and going, and at some point, is there anything down there waiting for us where we’re gonna be like, “Okay, we’re gonna do something about this, right, though?”
It’s not like, in the future we’ll be able to adapt. A lot of it just feels like a way of delaying and avoiding taking responsibility in that same kind of narcissist copypasta thing. But I hope... It sounds like the person that you’re talking to, though, maybe they genuinely care. Actually, there’s really good reasons to be a conservative and to care about conserving things. You could totally do it. But for cultural reasons that are totally toxic, we don’t really have that represented to the same... Like Wendell Berry, for instance, is someone that, conservative as far as I can tell, cares about conserving things, and he confuses everyone, and everyone likes to claim him for that reason. He can mean a lot of different things to a lot of different people. But for mainstream conservative stuff, I never see it. I hope what you saw, though, was a green shoot of someone who’s just like, care about limited government, private property, free markets, and also climate change is concerning to me. I hope.
Rudy Krehbiel: Yeah, I mean, to me it almost felt like, we’ve got massive wealth inequality or income inequality, socioeconomic inequality, and I think as part of today’s zeitgeist and the idea of the billionaire class is sort of part of popular culture, right? I think it’s becoming clear to folks on either side of the aisle, at least in the States, that the economy doing great doesn’t necessarily mean I’m gonna do great, right? Or, what it means to be happy as an American based on the policy choices, I think is becoming really murky. I think folks are kinda coming to this realization that it’s not black and white. Even if someone vocalizes that everything they’re gonna do is gonna make things better for me, that doesn’t always play out.
And so I bring that up just because I feel like there is a bit of a shift happening where folks are kinda questioning this whole idea of, what does it mean for me, and what does it mean when the government says they can’t afford to do something? Is that they really can’t afford it, or is it there’s not a priority to them, right?
So I’m optimistic about that, in that there seems to be less kind of blind faith, at least here in the States, and I’ve seen a bit of a hint of that. Even though climate has been vilified, it might not be all that bad to prioritize some of this stuff.
But my most idealistic stuff comes back to, I’m not an economist, so I’m probably getting all this wrong, but I still think we can create a ton of jobs from climate, and I think we can create a ton of energy that’s cleaner than what we have today, and we can create entire markets that benefit financially a lot of people, and a lot of people that matter, right? That make a lot of these decisions for us as citizens, right?
So I cannot wait to see... I mean, Europe’s doing a lot, but there’s gotta be a playbook out there for government to spin a lot of this work that is a public good into something that creates a ton of economic benefit and that treats all of these different investments in ways that are appealing regardless of your political affiliation or what your priorities are. Because at the end of the day, money talks, and I’d love to see us crack the code there and just totally spin this whole thing.
Don’t even call it carbon removal, right? Don’t call it climate. Whatever you wanna call it, but make it this focal point of policy that doesn’t sound like it’s just this charity fund for a future that we’re trying to avoid. It’s more like this is the big... Make it like data centers or something, right? A case of national security that we should just subsidize and fund out the wazoo and get everybody stoked about.
I quit thinking too hard about that a while ago just because it seems so out of reach with the current administration and whatnot, but I still think that that could exist. Even in a populist-driven world, I still think this stuff can be very politically popular on either side of the aisle if they get it right, you know? Maybe I’m just dreaming.
Ross Kenyon: No, I think so too. I think probably the answer to that will involve some amount of looking back into history for memes that were successful. One of the ones that I like that people pull up, the smaller scale version of this is the Victory Gardens, but also Liberty Ships. And we’re just gonna make for Lend-Lease huge amounts of transport ships, and we’re just gonna give them to the Allies to use. Something like that where the visual imagery of that and the motivation behind that is really powerful.
But you’re also saying... I don’t know if you watched the Republican convention news that just happened last night, but...
Rudy Krehbiel: I only saw one headline.
Ross Kenyon: Was it about communism? But obviously, the Trump and Republicans looking at Mamdani and others and being like, “These people are communist.” There’s a Palmer Raids, McCarthyism, there’s a strong red-baiting element to it that is part of our history that it calls back to. There’s ancestral memory of, “Ah, there’s communists under the bed. We gotta get...” Even if they’re Bernie Sanders and Sanders adjacent and AOC adjacent people, that’s a prominent tradition, and it’s very different from being an actual communist. That’s a very specific thing.
But it doesn’t matter because it is a very effective story, and communism, when enacted, is often pretty terrifying and not that good. So tell a story about how these people are actually this group that in America are not really welcome and historically we have persecuted, and also they are that thing right now, and we have to rally around it to stop. No matter how bad everything else is, communism is worse, right? That’s a story that Americans have used to enlist other Americans in their politics previously. So looking back for memetic memory that epigenetically lives in us and our parents, it works. You know? Liberty Ships does, whatnot. I think it’s maybe a nicer version of that.
Rudy Krehbiel: I find so much of policy these days just to be insanely unpopular if not for that manufactured consensus that I was talking about, right?
Ross Kenyon: Oh, like being American?
Rudy Krehbiel: Yeah, it’s...
Ross Kenyon: The flag is waving and there’s a sad, martial trumpet howling. Yeah.
Rudy Krehbiel: But I don’t know. Socialist policies, at the end of the day, tend to be super popular when you break them down on the microeconomic scale, right? When you just ask people, “Do you want cheaper childcare?” But I always think about, why do people not wanna pay their workers more, right? That’s more money for them to spend on your stuff that you’re trying to sell in the first place, right? How many more iPods are you gonna sell if everybody is making twice as much minimum wage? These really oversimplified kinda arguments. But that’s about where I’m at with a lot of the carbon removal stuff, you know?
Like, I think about how government contracts, I cringe at the idea. I think about defense spending, you know. But all of a sudden they’re talking about huge government contracts to do carbon removal, and it’s like now we’re talking. And that underpins the biggest industry in the States, you know? It’s like, let’s just do that for this thing too. It’s good to have dreams, I guess. I don’t know.
Ross Kenyon: Yeah. I mean, I like that story too, that I associate strongly with people like Henry Ford, who also had some not so nice opinions, I might add.
Rudy Krehbiel: You’re on a...
Ross Kenyon: Like...
Rudy Krehbiel: ...is that a theme for this show?
Ross Kenyon: Yeah, Henry... Yeah. It’s funny, that sort of paternalist era of progressive politics where you have people like Ford who, you’re building company towns, but oftentimes they’re company towns in a pretty nice way. You want workers to be able to buy your product. This is also the logic that comes later for the Marshall Plan, we need Europe to buy American goods. We have to get them back to speed. This is actually in our interest economically to rebuild these places, blah, blah, blah.
But obviously Henry Ford popularized the Protocols of the Elders of Zion and is pretty, I think even for the time, pretty bad anti-Semite.
But yeah, I think some of those ideas there. Again, at the macro level, you want your workers to be able to buy back your product or the products of other industrialists in your economy, but are you necessarily going to be the one to internalize that benefit, or will it go somewhere else in the economy?
And whatever ideology that had that noblesse oblige kind of paternalism in it, it no longer is there to the same extent, or they do it in a different way where rather than paying their workers better, they follow their fiduciary duty to extract as much as they can, and then they set up a charitable trust and a foundation, and then spend the rest of their life talking about how good everything that they’re doing is, and how many programs they’re supporting, and how many girls get to go to school in some foreign pla-- You’re like, could you have just not been so extractive in the first place? The answer is no, unfortunately, and it’s probably the way that shareholder responsibilities work.
Rudy Krehbiel: I mean, it’s different, but we deal with something similar every day. For Eco, for example, right? Everybody shows up with a commercial priority, right? “I need X, Y, Z done so I can get my next round of financing,” or, “I need to get my project registered,” or, “I’m in diligence and I need this particular thing to tell this story or I’m not gonna raise this money,” right? Or, “Make this deal.” Whatever it is, right? It always comes with a commercial.
And so it’s kinda what you’re talking about, right? You put your fiduciary hat on, you put your investor hat on. And that’s always, for Eco at least, we have to deliver on that first. But everything that we do for carbon removal, right? If you overlook a gap in the technical or the scientific rigor in your project, or if you skip some of these underlying steps for the sake of a commercial pursuit, that comes back around and will reemerge as a very expensive problem for you as a project developer or project owner, right?
And so it’s like what you’re talking about there constantly. How do we thread the needle commercially for what we need to get done or what the client’s trying to accomplish? I think Eco’s kind of in a unique spot where we look at everything as a market building exercise, right? So if this commercial solution somehow is gonna negatively impact credibility of CDR more broadly or negatively impact the credibility of this particular pathway, those are the things that we think about really intensely.
All of a sudden the commercial stuff starts to seem more simple, right? And it’s more obtainable and it’s immediate, right? We do X, Y, Z and we get what we’re looking for. But the longer term stuff is, I think, so much harder to account for on the regular. And for us, it’s making sure that we’re leaving a trail of breadcrumbs that are again, market building and additive in nature. And that tends to lift everybody up, right?
We worked on, I mean, countless first-of-a-kind methodologies and a lot of the edge cases that Eco used to work on are now foundational for the carbon markets. It’s like, what if we skipped some of these steps and really lowered the bar for what it means to be a BECCS project? Where would we be? Would we have ever sold any BECCS credits, or would there be 10X more BECCS projects out there because it’s easier to get them online?
Going through those machinations in your head is not a luxury that most operators in CDR have. They typically have to be hyper-focused on achieving a simple thing. And so at Eco we’re lucky that we get to worry about that kind of stuff. But to your point, you kinda have to constantly be waffling between, what’s this commercial objective that is gonna keep us in business and keep this project alive versus what kind of impact am I having on the broader industry as a whole? Little different than the Henry Ford company town thing, but.
Ross Kenyon: Yeah. Last question, Rudy. What is the story that we should be believing ourselves inside of at this moment?
Rudy Krehbiel: I think it really revolves around what I was getting at there in my last ramble about, whether you’re a participant as a company or an employee, if you’re participating directly in the carbon markets or you care about the environment, it’s really about ensuring that you’re taking in a broad swath of perspectives and really making sure that the actions that you’re taking are beneficial to the space as a whole, and not just your own company or your own project or whatever that single focal point might be.
Because it’s gonna just get harder and harder, to your point about changing dynamics around the globe and this threat of folks buckling down. I think those trade-offs are gonna get harder and harder, and we’re gonna have more and more decisions. Everybody is gonna have more and more decisions like that every day.
And so you talked about pattern matching and what it means to be a critical thinker, right? And to a degree, there’s some empathy involved, right? But I genuinely think that that’s not only an altruistic way to go about things, it’s really what this market depends on for long-term success, because one small step backwards has a domino effect on an entire pathway or the entire market.
So just taking into account that the decisions you make, the steps that you’re taking to try to grow your company or grow your business or achieve a goal, that stuff has broad, widespread impact well beyond your own objectives. So I think if we can all keep that top of mind, we’ll potentially see some good outcomes.
Ross Kenyon: Yeah. I guess the one thing I’ll add to that, I just was reading an article this morning about the game theory arms race dynamics around developing artificial general intelligence, and the attitude for people who either are in government or at companies developing AI is, “Well, if we don’t do it, someone else is going to do it.” You’re like, “Okay.”
But you are responsible for your own actions. Maybe you aren’t responsible on Earth. Maybe that’s something that you answer to some higher entity later, or maybe your family has to answer to that once they see the outcomes of this later in life, or you yourself staring at your life’s work later.
But sharp elbows are a choice here, and a desire to participate in a game theory that’s individually rational but collectively irrational. You also just don’t have to. I think the existentialist point about freedom is really important. You can do something noble that results in the Nazis killing you. You don’t actually have to go along with it. You have to be willing to pay the price for it, but that is the thing that you have to decide ahead of time, too.
We care about this as a climate thing, and that requires a lot of people making carbon removal work, and that means sometimes it may not be individually good for your company to do something. But if you wanna be a leader, that’s part of what it means, I think, to be a leader and to show that, even if it’s personally uncomfortable, and it can suck if you’re the only person doing it and no one else does. That’s for every person to answer individually, I guess.
Rudy Krehbiel: Yeah, it’s your story, to your point.
Ross Kenyon: It’s your story, yeah. You can have a twist ending that you decide that is actually in humanity’s best interest and does not just follow the capitalist logic of, “Well, yeah, if we don’t cut the corner on this methodology, someone else is gonna do it, so we should just do it first so we win.” You’re like, “What? Really? How did we get to this point? What story are we in that has led us to make this decision? It’s not a good one.”
Rudy Krehbiel: Gotta compete.
Ross Kenyon: Gotta compete.
Rudy Krehbiel: Small wins. I don’t know. Yeah, I feel like for me, at the end of the day, it’s just what you said. It’s the story you have to tell yourself or you have to hear from yourself for the rest of your life. And I find life to be much more pleasant when it’s a story that I know is at least somewhat genuine, right? I’m not saying it’s a great story, but it’s one that, it’s real and that I can learn from, right? I think that’s... Yeah. Why make shit up?
Ross Kenyon: I mean, so that’s why I love stories that are about self-deception and delusion. It’s one of the reasons why I especially love The Bridge on the River Kwai. I think that comes up on the show pretty often. I would just be like, “What goal were you maximizing for exactly?” And it works out, I guess, but barely, and only works out through irony, basically, and not through anything else.
Yeah, there’s a lot more to say about it. Thanks for being here, Rudy. I gave you an impossible task. Impossible. Impossible, but you did a great job.
Rudy Krehbiel: Apparently I’m all in on impossible tasks these days.
Ross Kenyon: Yeah, it seems that way.
