Climeworks AG is laying off 106 people, as startups that aim to reverse global war
ming face a reckoning with the US government slashing climate incentives and programs.
The Swiss startup was one of the first companies to develop direct-air capture (DAC) technology to suck carbon dioxide from the s
ky. It was set to start work
building its largest to capture as much as 1 million tons of planet-warming carbon
dioxide from the air after receiving a $50 million US government grant last year,
with the possibility of securing a further $500 million during construction.
Since then, President Donald Trump’s administration has launched reviews a
nd pulled back government support for many carbon-cutting projects. Though
the Energy Department ha
sn’t axed the program backing Climeworks’ Louisiana plant, its future remains unclear.
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“We are prepared to move forward with that project, but we also need to consi
der the scenario that there are changes, or that the administration will not move forward with the pro
ject,” Jan Wurzbacher, co-founder and co-chief executive officer of Climeworks, told Bloomberg Green in an exclusive interview.
Climeworks Co-Founder Jan Wurzbacher at the company’s Mammoth carbon removal plant in Hellisheiði, Iceland, in May 2024. Photo credit: Heida Helgadottir/Bloomberg
Before the reductions, the company’s staff count stood at 483. “We are coming out of a phase of extreme growth,” Wurzbac
her said. Given unfavorable market conditions, the company is looking to cut costs and become profitable. To do that, “we need to consolidate a little bit,” he said.
Founded in 2009, Climeworks constructed a pilot plant in Iceland in 2021 followed by a larger version that began operations in 2024 and is still being built out.
Climeworks wasn’t just one of the first to capture CO2 from the air: It also worked with Icelandic partners to store it underground
. Studies have shown the gas can be mineralized into rock after as little as two years, permanently locking away the planet-warming gas. That’s helped the company raise nearly $800
million, making it one of the best-funded DAC startups.
But the DAC process is energy-intensive and expensive. Climeworks charges individuals $1,000 per ton of CO2 captured. In comparison, the price of one ton of CO2 on Europe’s Emissions Trading System is about €65 ($73).