A startup founded by former SpaceX engineers, Arbor Energy, has raised $55 million to build a new kind of power plant that can remove carbon dioxide from the atmosphere. But in a significant change of plans, the company is pivoting from its original plan to burn only plant waste to also burning natural gas.
The reason for the shift is the massive and growing demand for electricity from AI data centers. The company’s original design, which was like a “vegetarian rocket engine,” was perfectly capable of powering these data centers. Still, its reach was limited by the availability of wood and agricultural waste. Natural gas, on the other hand, is everywhere.
Arbor still plans to capture all the CO2 produced by its power plants. It’s special “oxy-combustion” process makes the CO2 pure and easy to store underground. Thanks to tax credits, the company says it will actually be cheaper to capture the carbon than to release it into the atmosphere.
However, the move to natural gas comes with its own environmental concerns. The main component of natural gas is methane, a powerful greenhouse gas that can be much worse for the climate than CO2 if it leaks into the atmosphere. Arbor says it is working with natural gas suppliers that have been certified to have low leakage rates.
The startup is still moving forward with its original plan to build a biomass-burning power plant in Louisiana, which is being partly funded by a major deal with the climate initiative Frontier. But this new pivot shows just how much the AI boom is reshaping the energy landscape, pushing even green-focused companies to make some tough compromises.
