UP Catalyst secures €18m in EU funding to produce graphite from captured emissions

The world’s appetite for graphite keeps growing, as it's a critical component for making lithium-ion batteries. Most electric car batteries today contain at least 50 kilograms of the material.

And since most graphite is imported from China, that contributes to a larger carbon footprint even for technologies meant to tackle the climate crisis.

UP Catalyst wants to change that by ramping up Europe’s own production of graphite, and is doing so with a method that utilises the CO2 captured from industrial emissions.

That differs from most traditional ways of making graphite synthetically, which rely on fossil fuel-based sources like petroleum coke.

"As most of the graphite supply comes from China and the rest of Asia, it puts a lot of strain and risk on the supply chain. It’s like having all your eggs in one basket," UP Catalyst CTO Sebastian Pohlmann tells Impact Loop in an interview.

"So we have set out to solve this problem with a very unique approach, which is to make graphite from a carbon source that we have too much of anyway. So we take CO2 and we turn it back into carbon."

UP Catalyst was selected as a strategic project partner by the European Commission last month under the Critical Raw Materials Act (CRMA), and has now received further backing from the EU.

The European Investment Bank is providing an €18m loan to help scale up the technology.

"A key pillar for us is to finance innovative net-zero technologies that can help to reduce adverse impact on our climate and environment while strengthening Europe's competitiveness," says EIB Vice-President Thomas Östros, who attended an event at UP Catalyst’s new third-generation production facility in Estonia on Tuesday to announce the funding. "We are excited to support [UP Catalyst] in scaling their operations and advancing sustainable technologies that will shape the future of Europe’s green transition."

The new financing comes after UP Catalyst raised more than €6m in seed funding over the last 18 months, with investors that included VC fund Extantia and Warsaw Equity Group.

And the company has plans for rapid expansion.

UP Catalyst’s third-generation facility has a pilot reactor that can produce both graphite and other materials like carbon nanotubes, which can be used to strengthen concrete and in a variety of other applications.

The company already has plans for a fourth-generation facility with a full-scale industrial reactor with a plan of reaching 60,000 tons per year sustainable carbon production capacity.

"We see the CO2 as a feedstock"

They do that by buying up biogenic CO2 that is captured from industrial sites burning biomass.

"Most carbon capture companies expect to be paid for the CO2 they capture. We are actually willing to pay for the CO2. So we see the CO2 as a feedstock," Pohlmann says.

And it means there’s a near endless supply of their feedstock.

"If you just take the biogenic CO2 that’s produced in Estonia, that’s more than enough to make graphite for one million electric cars already,” Pohlmann says. "So looking at the biogas plants that are all around Europe, there's definitely enough biogas-based CO2 to enable us to build our plants wherever our end customers would require us to be."

Benefits for Europe could be massive

That kind of capacity is still a few years down the road, however. The plan for the initial fourth-generation reactor is yield a bit more than one kiloton of graphite a year – using up nearly four kilotons of CO2.

If production ever reaches the kinds of scale that UP Catalyst has in mind, the benefits for Europe – and other parts of the world – could be massive.

"The critical part here is, not only for Europe but also the United States, is to build up their own supply chain for these critical raw materials," Pohlmann says.

"Not only because of all the strategic considerations. But look at why we are making graphite in the first place – it’s to make lithium-ion batteries to electrify the world and save CO2 emissions. But shipping tons of graphite around the world only produces CO2 emissions. So if you can make it locally, it’s automatically lower on emissions. And if you make it with our method, you can make it climate neutral because you are also taking CO2 out of the atmosphere."