Oxylus Energy, a developer of carbon utilisation technology for e-fuels, has closed a $4.5 million Series Seed investment co-led by Toyota Ventures and Azolla Ventures, with additional participation from Earth Foundry and Connecticut Innovations. This funding will accelerate the development, testing, and pilot deployment of Oxylus’ technology, which focuses on converting carbon dioxide into green methanol through a unique low-temperature, low-pressure process.
Oxylus Energy’s approach is based on the first-ever catalyst for direct electrochemical conversion of carbon dioxide to methanol, developed at Yale University by Professor Hailiang Wang. This process, which uses captured carbon dioxide, water, and electricity in a reactor similar to green hydrogen electrolysers, offers a lower-cost alternative for producing sustainable fuels.
The green methanol produced by Oxylus can serve as a direct fuel replacement or be upgraded into jet fuel and other petrochemicals, providing a flexible solution for industries that are difficult to decarbonise, such as aviation and shipping. “Direct electrochemical conversion of carbon dioxide at low temperatures and pressures is the only way to decrease the cost of green methanol. Without decreasing the price of methanol, it will be difficult to decarbonise the hard-to-abate sectors of aviation, shipping, and petrochemicals that are currently responsible for 11% of global emissions.,” said Conor Rooney, Co-Founder and CTO of Oxylus Energy.
The World Economic Forum estimates that green methanol can reduce carbon dioxide emissions by nearly 95%. Additionally, it can be blended with traditional fuels, enabling a seamless transition with minimal infrastructure upgrades. While current production of green methanol is limited to less than 0.2 million tons annually, the International Renewable Energy Agency (IRENA) projects this figure could rise to 500 million tons by 2050. Oxylus Energy aims to meet this growing demand while reducing production costs and advancing the global transition to net-zero emissions.
“This is why Oxylus’ technology is critical—it can meet the growing market demand for methanol in the net-zero transition at a price that actually works for industry,” said Perry Bakas, Co-Founder and CEO of Oxylus Energy.
Lisa Coca, Climate Fund partner at Toyota Ventures, highlighted the significance of Oxylus’ innovation: “Eliminating the need for hydrogen as an input is a significant innovation in the green energy space that has the potential to dramatically reduce production costs and unlock numerous decarbonization pathways.”
Amy Duffuor, General Partner at Azolla Ventures, emphasised the broader impact of the technology: “While green methanol provides a pathway to decarbonize hard-to-abate sectors like shipping, maritime and aviation, price premiums and limited supply restrict feasibility of adoption. Oxylus Energy’s modular single-step CO2 electrolyser, however, is highly efficient, reduces cost, and can be easily stacked to scale green methanol production.Oxylus Energy’s technical progress combined with the novel catalyst, complementary team and ability to target multiple market applications, makes it an optimal investment for Azolla. We are incredibly excited to partner with Oxylus Energy on the next phase of their journey.”