# Khosla-Backed Calera Scoops Up $19M for Carbon Recycling Calera Corp., a startup working to capture emissions from industrial flues and recycle it into pavement and building materials, has made it to the second phase of a competitive government program for carbon capture projects. The Department of Energy announced on Thursday that it will invest nearly$19.9 million in stimulus funds to help Calera design, build and deploy a system for churning out carbon-fed cement and aggregates at pilot scale.

Already backed by at least $50 million from Khosla Ventures and$15 million from coal giant Peabody Energy, 3-year-old Calera now ranks among group of only six companies selected for the latest phase of this program, out of the original dozen awarded DOE grants for the first phase. This marks a vote of confidence for Calera and the other companies that the DOE considers their projects and tech most promising for commercial deployment, DOE spokesperson Tiffany Edwards told us today.

Calera, based in Los Gatos, Calif., currently has a demonstration project at a natural gas-fueled power plant near Moss Landing, Calif. and a second demo in the works at a TRUenergy power plant in Australia’s Latrobe Valley. The company aims (ambitiously) to have most power plants using its technology within a decade, Calera founder and CEO Brent Constantz said at a recent Khosla Ventures event.

With the $19.9 million in new funds announced on Thursday, Calera will be working to complete the design and construction of a system “that at smaller scales has produced carbonate-containing aggregates suitable as construction fill or partial feedstock for use at cement production facilities,” according to the DOE. The goal is for Calera to ultimately integrate this system with the absorption system that’s already in place at Moss Landing in order to demonstrate the viability of the whole process “at a significant scale.” Calera’s scheme is not without skeptics. The company’s claims became the subject of debate in a Google Groups forum spotted by the Cleantech Group last year (when the company had a diagram of its process on display at the California Academy of Sciences) and criticism from Ken Caldeira, a professor in the Carnegie Institution Department of Global Ecology who studies carbon sequestration. Caldeira argued that from the publicly available info about Calera’s technology, it seems to go “in the wrong direction and will tend to increase and not decrease atmospheric CO2 content.” Constantz responded in an email posted to the forum by slamming Caldeira’s scientific credibility and dismissing the criticism as a thinly veiled attempt to determine whether any of Calera’s processes infringe on a patent held by Caldeira and research partner Greg Rau. Other companies selected to receive a total of$106 million in this latest round of grants include Alcoa, Novomer, Touchstone Research Laboratory, Phycal and Skyonic Corp. It’s not quite money in the bank, however. The companies will be required to come up with an additional $156 million (for 40:60 cost sharing between public and private coffers), and the grant money will be doled out in stages as the awardees hit certain benchmarks, according to Edwards. Projects eliminated after Phase 1 are now out of the running for additional funds under this program, Edwards confirmed with us today. Those projects were led by Gas Technology Institute (GTI), Renewable Energy Institute International, the Research Triangle Institute (which the DOE recently awarded$800,000 under a separate program for carbon capture and conversion research), Sunrise Ridge Algae, the University of Massachusetts at Lowell and UOP.

Alex Klein, research director for Emerging Energy Research’s clean power generation group, told us last year (amid debates over how to allocate funds for carbon capture in the stimulus bill) that shoving millions of tons of carbon dioxide underground (aka sequestration) presents a technologically simpler challenge than recycling it. Storage space will eventually run out, but with recycling, you don’t have that problem.

Plus, as Secretary of Energy Steven Chu has commented, “economic use” of carbon dioxide in revenue-generating products could help accelerate deployment of carbon capture technology, which he believes needs to be ready for “widespread, affordable deployment” within 8-10 years. Yet like sequestration, recycling of carbon has yet to be proven at industrial scale. As Google (s CEO) Eric Schmidt put it last fall, carbon capture tech is like a half-baked web tool, in that it still needs some “debugging.”

Image courtesy of Calera

Related content on GigaOM Pro (subscription required):

Cleantech Financing Trends: 2010 and Beyond