Read this if you care about industrial decarbonization

Hi there,

Last week, we introduced you to Glassdome’s business and the software and solutions they’re building to make it easier for manufacturing and industrial companies to comply with complex, new regulations and make smarter decarbonization decisions. We also explored how integral to these processes acquiring new primary source data from suppliers in manufacturing environments is: As opposed to using averages or estimations, ‘real’ data from manufacturers’ supply chain is the best way to inform making sustainability-minded supply chain changes.

This week, we’ll both dig deeper into that, where else Glassdome expects to expand their business in the future, and why all this even matters, anyway.

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The world in 2034

Sitting here in 2024, a lot of what I've been getting excited about in the realms of manufacturing and industrial decarbonization are new commitments to testing novel industrial processes and manufacturing approaches that will reduce emissions. Examples include the $6B in DOE and OCED funding we covered last month that will accelerate commercial-scale pilots across lower-carbon steel, cement, and aluminum manufacturing and more. 

As I often note, what matters about these 'tests' isn't so much the millions of tons of carbon dioxide emissions they themselves may mitigate as what the world will learn from their relative success. How much more expensive will they be compared to traditional approaches? How much room to shrink that additional cost is there? How much cleaner and greener were they?

This line of thinking is not dissimilar to the way Glassdome is building its product offering and software. By focusing first on streamlining product carbon footprint calculations for all kinds of manufactured products and by getting adept at sourcing primary supplier data for those calculations, Glassdome is onboarding as much intelligence onto a platform as possible. As that data set grows, its value grows exponentially, too. In, say, 2034, you can imagine it being one of the best destinations for a manufacturing or industrial company to understand whose process and which suppliers across which geographies have the lowest-carbon footprint.

While Glassdome will extend its platform beyond emissions-related data, starting with a focus on product carbon footprint makes sense because that’s really where the rubber meets the road. Companies can and do consider countless different sustainability measures when evaluating their production and sourcing processes. But product carbon footprint is a great place to make apples-to-apples comparisons between different decarbonization pathways, different products, or different manufacturers holistically. 

As Glassdome’s co-founder and COO, Joshua Charnin-Aker noted in conversation with us: 

Saying all this differently, what’s exciting to me about Glassdome is that they are building one of the best repositories of product carbon footprint data on industrial and manufacturing operations globally, which will be valuable to loads of types of stakeholders across geographies. Still, building the most differentiated data set requires a moat. Sometimes, that moat is simply dug out by doing hard things others aren't interested in doing.

The moat: Do hard things

A lot of Glassdome's differentiation lies in the fact that they're helping a sector of companies with some of the more complex product carbon footprint calculations and lifecycle emissions analyses imaginable. For instance, the specialization in calculating product carbon footprint for battery manufacturing they’ve already built is the product of a 50+ person team that has decades of experience and is adding more all the time. As they work with two of the largest Korean battery manufacturers, the more time passes, the more expertise they compound.

As we introduced last week as well, there aren't many companies building solutions for this corner of what others call the carbon accounting world because, well, it's hard. Stepping into manufacturers' supply chains to unearth primary data can be quite challenging. The product carbon footprint calculations themselves are complicated. The regulations to which Glassdome's work is responsive are even more complex (see below for battery manufacturing regs out of the EU). Sometimes differentiation and business moats are as simple as doing things that are hard and that other companies don't have interest in doing.

To illustrate why, say you want to really understand the factory-level emissions data for one chink in the chain of a manufacturing or industrial process. Applying averaged or estimated emissions data won't do. At the level of a factory, even if a factory has an electrometer installed to measure how much electricity processes are used, they probably have it installed at the factory-wide level, not on a machine-by-machine or line-by-line level. 

To make product-level carbon footprint assessments, Glassdome might need to execute complex allocation calculations to divvy up what electricity was used in producing one type of product. Suppliers don't have the requisite knowledge about the rules that map to regulations driving interest in product carbon footprint, nor necessarily the money or time to invest in all the equipment and expertise to gather the necessary data to calculate it. 

Historically, faced with all this, companies hire consultants for one-time analyses. Glassdome's products allow companies to execute analyses and build intelligence on an ongoing basis. If the world is serious about decarbonizing manufacturing and industry, this is the level of necessary capability. One-off, average, or estimated emissions data inevitability is too obfuscated to drive effective decisions at the level of factories, factory lines, and individual products. A constantly growing, updated, and dynamic compass is infinitely more impactful for manufacturing and industrial companies to sustainably grow their operations, both in response to new regulations and voluntary sustainability and decarbonization priorities. That's what Glassdome is building.

Over time, we can envision a future where Glassdome has a deep understanding of the emissions intensity of many critical products and material inputs globally and the supply chains that bring them to end consumers. They'll also build a differentiated database of who is actually successfully making materials and products more sustainably. Having insight into a raft of manufacturing and industrial suppliers' data means that they can then guide manufacturers' decision-making around decarbonization. As customers analyze their supply chains, they will have the opportunity to evaluate other suppliers who potentially have cleaner product footprints and to undertake scenario analyses around the impact of shifting their suppliers. Plus, they’ll be able to quickly assess what moves make sense from an investment and ROI perspective.

Turning back to Josh, here’s how he recapped this for us:

Beyond product carbon footprint

Beyond continuing to be the front runner in product carbon footprint solutions, Glassdome has an opportunity to become a critical repository of all types of sustainability data. A lot of Glassdome’s focus in 2024 is on batteries; they support several marquee manufacturers globally, including SK. As Glassdome inks other customers, however, say, for instance, aluminum manufacturers (as they are), they can apply a similar playbook to support new sectors of industrial decarbonization. 

For instance, Glassdome is working with an aluminum foil manufacturer and digging in deep to understand the nitty-gritty of what it takes to calculate and report on product carbon footprint for that industry. That’s particularly relevant for a variety of reasons, including, for instance, as the U.S. builds its first new (lower-carbon) aluminum smelter in decades.

Each time Glassdome executes this flow for a new product in a new industry with a new customer, it acts as a beachhead to go out to other manufacturers operating in the same space and say, "Hey, we know how to serve you. We've done the work once, and we're getting insights on how you can drive decarbonization results." It also opens up opportunities to build more offerings on top of their product carbon footprint expertise. While product carbon footprint is a great place to start to build a base layer of data and software to drive decarbonization decisions, it's far from the end-all, be-all when it comes to sustainability.

Other variables that are salient to battery manufacturers, for instance, include labor practices and safety in supply sourcing and manufacturing. On this front, Glassdome is working with the Global Battery Alliance to lead pilots for two major Korean battery manufacturers to 'track and trace' their supply chains all the way back to lithium, nickel, and cobalt mines to assess dimensions like labor practices, safety, and more. 

Whether it's regulatory-driven or not, we'll likely see extensive new data-gathering requirements percolate on all these fronts in the coming years and decades. Whether it's for battery manufacturers, automotive companies, or another category entirely, players all along the supply chain will need to get their arms around new data and then, more importantly, make sense of it and make informed decisions with it in hand. As TJ Yoon, Product Manager at Glassdome, commented, that's where a lot of his forward-looking excitement lies:

TJ also noted that all the companies they work with or engage with are very curious about their competitors' numbers. This tells me (and Glassdome) that no one really has a firm grasp on industry standards on the sustainability front at this point. It's an entirely open ocean, or wild west, whichever you prefer. However, this is the direction all these industries need to grow towards; companies should compete with one another in these dimensions, whether product carbon footprint, labor practices, or others. Whether for regulatory reasons or others, they'll want to know their numbers, work towards lower numbers, or risk being out-competed.  

The net-net

Especially in the U.S., we talk a lot about the free hand of the market. We even talk about climate capitalism, i.e., capitalism in terms of innovations and technologies – such as the plunging cost of solar and batteries – that will drive decarbonization results. Still, at the end of the day, the market’s inability to effectively ‘price’ carbon dioxide and other greenhouse gas emissions is probably one of the more significant market failures of all time.

Fixing that market failure inevitably requires regulation as well as stimulative policy to incent technology innovation and adoption. On top of that, however, you need products that help companies at the heart of society-dependent processes like manufacturing and industry navigate new regulations and make actual data-driven decisions about how to adapt to new priorities, whether emissions-related or not, as they take root. That’s why I’m excited about Glassdome. They’re positioned to help countless companies across sectors navigate this work, which will constitute a 50 or 100+ year endeavor, really.

Connect with Glassdome

If you’re connected to or work at a manufacturing company and are ready to have Glassdome take a first look at your systems and processes or to go full bore on meaningful sustainability actions, I recommend getting in touch with them. This isn’t a zero or one action; even taking the first step to do a first analysis of a product carbon footprint calculation sits on a spectrum. Wherever you are in the supply chain or internal readiness, Glassdome is ready for you.

JOBS @ GLASSDOME

In the words of Glassdome’s COO, Josh Charnin-Aker: “We are looking for the best life cycle assessment practitioners out there, people with the most experience doing product carbon footprint calculations. We're willing to pay a very high price to get those people on our team.” 

If that sounds like you, Glassdome is all ears. Respond to this email or apply here.

If your skillset isn’t in product carbon footprint or life cycle assessments but you’re compelled by Glassdome’s business, product, and vision, feel free to respond to this email, too.

Thanks,

Nick