CarbFix as a subsidiary

28.11.2019

The Board of Directors of Reykjavík Energy (OR) has approved, subject to the confirmation of OR’s owners, to establish a public limited company (PLC) around CarbFix operations. The CarbFix process has been successfully operated at the Hellisheiði Geothermal Power Plant in recent years. The aim by separating CarbFix operations from the core activities of OR are;

  • further supporting climate action by providing interested parties in Iceland and abroad the opportunity to reduce their carbon footprint with the CarbFix process.
  • preventing growing CarbFix activities from interfering with other research and innovation projects within OR.
  • limit and mitigate the financial risks of the basic services and core activities of OR
  • protect the intellectual property rights of CarbFix.

The pending PLC will be entirely owned by OR.

Competitive option

The CarbFix project dates back to 2006 as an international science collaboration between Reykjavík Energy, University of Iceland, CNRS and Columbia University. The process continues to be under further development to increase its applicability in different operations and environment. OR is currently leading two international research and innovation projects that grew from the original CarbFix project; CarbFix2 and GECO. OR along with collaborating parties working on these projects have received multiple international grants to further develop the process, mainly from the European Union. GECO for example received a €15,6 million grant from the Horizon 2020 research and innovation program. The new subsidiary will continue to pursue such research funding opportunities.

The cost of carbon capture and storage using the CarbFix method at the Hellisheiði Geothermal Power Plant is ~$25/ton. Further development of the method is anticipated to reduce the cost of the process. However, this cost is comparable to or lower than the cost of buying carbon quota through the European Union carbon trading scheme (ETS). The current price of carbon quota on the ETS market is around $26,5/ton.

Limit the risk

CarbFix has received global attention in recent months and years, especially with respect to applicability to reducing emissions from various power and industrial processes. However, investing in climate projects comes with a potential risk. Therefore, one of the goals of establishing the new subsidiary around CarbFix is to limit the financial risk of OR in relation to new CarbFix projects while still continuing CarbFix development and scale-up in Iceland and abroad.