Brimstone has the right approach for decarbonizing cement

Multiple startups are working to decarbonize cement production. I like Brimstone's approach because of its elegance, timeliness, low business risk, and the founders’ mindset.

Background

The Department of Energy (DOE) has produced a series of “Liftoff Reports” to “create a common fact base and a tool for ongoing dialogue with the private sector on the pathways to commercial liftoff” of clean energy technologies. The Liftoff Report about “Low-Carbon Cement” points out that “Cement represents ~7–8% of global CO₂ emissions and ~1–2% of U.S. CO₂ emissions.” This report was the main topic of conversation between Jigar Shah of the DOE and Brimstone CEO Cody Finke for the Demonstrate Deploy Decarbonize (#Deploy23) event in September (Fig. 1). Brimstone was founded in 2019, and it has so far raised $60M over two rounds from Breakthrough Energy Ventures, DCVC, Fifth Wall, and other investors. I love Brimstone’s approach to cement decarbonization because of its i) elegance, ii) timeliness, iii) low business risk, and iv) the founders’ mindset.

Figure 1: Jigar Shah of the DOE spoke to Cody Finke, co-founder and CEO of Brimstone, about their approach to lowering the carbon emissions of cement

A new recipe for Ordinary Portland Cement

Cement is the key binder in concrete, which is one of the most common man-made materials in the world. Different types of cement exist; however, Ordinary Portland Cement (OPC) is by far the most common form. It constitutes 95% of the cement produced in the United States. Calcium-based minerals are key ingredients in OPC. Historically, the main feedstocks for cement production have been limestone or gypsum, which are both rich in calcium (Fig. 2). As I have written before abundance is a key requirement for the adoption of industrial-scale materials. Both of these feedstocks are abundant globally. The process that uses gypsum also produces sulfuric acid. In the past, this co-product was a useful secondary source of revenue for cement producers. However, there are now other ways of producing sulfuric acid. The need to safely discard this material has caused cement producers to turn away from gypsum as a feedstock.

Figure 2: Brimstone uses calcium silicate rock to produce OPC. This process reduces emissions and creates valuable co-products.

Limestone has become the primary source of calcium for making OPC because it does not produce the same caustic co-product as gypsum. However, the calcium in limestone is attached to carbonate, which is released as CO₂ when heated to 1,500 °C. This release accounts for more than half of the CO₂ emissions of cement. Another 34% of the emissions are due to the fuel that is burned to heat the cement kilns in this step. Brimstone has invented a new recipe for OPC, which uses calcium silicate rock as the feedstock. Over the Summer the company received the ASTM C150 certification for its OPC recipe. This feedstock not only avoids producing harmful co-products but also leads to valuable Supplementary Cementitious Materials (SCM) and Magnesium compounds. SCM is one of the components of concrete (in addition to cement), which would otherwise have to be purchased separately. Magnesium absorbs CO₂ from the atmosphere, which makes this process carbon-negative for a variety of heating processes. Brimstone has created an elegant solution that avoids the worst parts of the current process while improving the economic outcome because of the valuable co-products.

Why now? A secular shift in SCM supply

SCM is used as a partial replacement for cement in mixing concrete. Different materials can be used as an SCM as long as they are rich in silicon and aluminum. Fly ash, which is a residue of burning coal, has been one of the most common SCMs in concrete production. Coal consumption in the US nearly tripled over half a century, since the 1950s. This increase was driven by the use of coal for electricity production (Fig. 3). Starting in the mid-2000s US coal consumption began a precipitous decline, where it now stands at less than half of its peak. US natural gas production has doubled during the same period because of fracking. Natural gas has replaced coal as the dominant source of energy used for electricity production in the US.

Figure 3: US natural gas production has doubled since 2005 (top) while US coal consumption has dropped to a 60-year low (bottom) because of fracking.

The phasing out of coal power plants has significantly reduced the production of fly ash in the US. The US now imports fly ash from China to be used in concrete as an SCM. Fly ash represents a multi-billion dollar industry. The fact that Brimstone co-produces an SCM along with their cement makes their product more economical. As Cody Finke told the CleanTechies podcast, “[If] supplementary cementitious materials were abundant, then our process would probably be too expensive. But because they're not abundant, because of this transition away from coal, our process, we believe, would be lower cost at scale.” Brimstone’s approach is right on time, because of this secular shift in the supply of SCM.

Brimstone has low business risk

Brimstone is aiming for an already-existing cement market, which is valued at $340B globally. Brimstone is a quadrant 4 company, and it faces a low business risk (Fig. 4). As I have written before, I like this risk profile because there is no question that if they are successful at scale the market will adopt their product. Some of the other cement decarbonization companies plan to charge a “Green Premium” for their products. I have written before that quadrant 4 companies cannot charge a Green Premium at scale, because they cannot charge for a “sustainability” feature. Companies in this quadrant can only differentiate their products on price or specifications, and not on features. Brimstone understands this fact and it is acting accordingly. Cody told the CleanTechies podcast,

I don't know too many folks that want to buy more expensive concrete, but I do know a lot of folks that want to buy clean concrete… If you can make this the same material for a lower price point without the CO₂ emissions, or even the same price point… that's a huge win. But any more expensive… it's not a win for the world cement industry.

Figure 4: Brimstone has the right strategy for addressing a market with low business risk. It is competing with the incumbents on price.

Brimstone’s founders have the right mindset

I love listening to Cody talk about Brimstone’s journey and approach. He is aware of the pitfalls of deep tech climate entrepreneurship. These entrepreneurs are often idealistic about their technologies and carbon reduction missions. I greatly admire them personally, and I hope that they succeed in their work. However, when I mainly hear technology specs or carbon reduction goals from some founders, I wonder if they are sufficiently focused on the economic drivers of product adoption. What we verbalize is a sign of what we think about. Why would a customer buy this product at scale? Will it ever be cheaper or better than the incumbent? Is it risky to assume that the customer’s decision will be driven by climate considerations instead of economic ones? Instead, in the same interview Cody talks about minimizing economic risks. He says that Brimstone has

An unrelenting attitude of if it doesn't work in today's economic assumptions, then the process is not good enough… we're not multiplying risks that we can't control together… like we realized, ‘Oh, this process is great, except electricity has to be 24 hours a day and clean and 0.1 cents per kWh. Oh, this is great, but we need a $50 per ton carbon tax. Or, oh, this is great, but we just need to ship rock from Hawaii all over the world’… a lot of folks will either maybe fool themselves a little bit with assumptions which is really easy to do because you love what you're doing… or they will assume things that are really risky.

As Richard Feynman put it, “The first principle is that you must not fool yourself and you are the easiest person to fool.” Reducing emissions is important for the health and safety of humanity globally. Building a venture-backed startup can be a powerful tool for addressing this issue. However, the common rules of business will still apply to companies in this sector. A beautiful technology or an important cause will not automatically lead to customer adoption if the economics do not make sense. As Cody put it, “We're all trying to build businesses here and you're not going to change the world or solve a climate problem or whatever if your business doesn't go anywhere.” That is the right mindset for building a deep tech climate startup, and it is one of the reasons that I love Brimstone.

A song I like

Oh, father of the four winds, fill my sails 
Across the sea of years 
With no provision but an open face 
Along the straits of fear 

A scene I like

Don Draper: “Get out of here and move forward. This never happened. It will shock you how much it never happened.”

Look at the light on Don’s face at the end: half lit and half dark. It is reminiscent of the lighting in The Godfather.