- Startup aims to turn atmospheric carbon dioxide into fuels and advanced materials
- Global direct air capture market projected to top $5 billion by 2030
Shanghai-based carbon utilization startup Carbonology (碳生万物) has completed a Series A funding round led by existing investor Yellow River Delta Industry Investment and new backers Gaorong Ventures and BioTrack Capital.
This funding, announced on June 12, comes amid growing investor interest in technologies that remove carbon dioxide from the atmosphere and convert it into commercial products.
The June 11 financing also roped in strategic investors including battery giant CATL, solar and energy storage equipment maker Sungrow, and Efung Capital.
Several existing shareholders also participated in the round. Financial terms were not disclosed.
Direct air capture
Founded in 2024, Carbonology develops direct air capture (DAC) technology that extracts carbon dioxide from the atmosphere and combines it with renewable electricity and green hydrogen to produce synthetic fuels and other low-carbon products.
The startup will use the proceeds to build a 1,000-ton DAC pilot facility in northwestern China’s Ningxia, expand production processes for e-SAF, or sustainable aviation fuel, upgrade core technologies and recruit talent, the company said.
Carbonology’s focus on e-SAF places it in one of the most closely watched segments of the carbon utilization market.
Synthetic aviation fuel made from captured carbon dioxide and green hydrogen is widely seen as a key route to reducing emissions from air travel, an industry that has pledged to reach net-zero emissions by 2050.
Applications spanning renewable
The participation of CATL and Sungrow could also provide industrial validation opportunities beyond funding. Carbonology said the partnerships may support applications involving energy storage thermal management systems and photovoltaic-related materials.
At the core of the company’s technology is a proprietary platform it describes as “carbon-enzyme coupling.”
This technology enables the one-step synthesis of materials including polyhydroxyalkanoates (PHA) and bio-based furandicarboxylic acid (FDCA), key ingredients used in biodegradable plastics and advanced polymers.
Net-negative carbon emissions
Carbonology said products made through the process can achieve net-negative carbon emissions across their lifecycle.
The company is currently advancing its Ningxia pilot project after completing technology validation and process optimization.
It said several key performance indicators have reached internationally competitive levels and that it has secured cooperation interest from multiple industrial partners.
Carbonology operates in the direct air capture and carbon capture utilization (CCU) sector, which focuses on removing carbon dioxide directly from the atmosphere and converting it into higher-value products rather than storing it underground.
According to data from research firm The Business Research Company, the global DAC market is expected to grow from about $1.77 billion in 2026 to $5.13 billion by 2030, representing a compound annual growth rate of 30.5%.
