UP Catalyst, a spin-off of the University of Tartu, has raised €4 million, which is planned to be used for expanding the production of carbon materials and graphite derived directly from carbon dioxide emissions, to provide European battery manufacturers with a sustainable source of raw materials.
The funding occurred amid China’s announcement of graphite export curbs that has added urgency to the quest for local battery raw material alternatives. This is particularly crucial given that Europe currently depends on graphite imports for 99 per cent of its supply. With the funding, the company will build an industrial pilot reactor capable of processing 100 tons of carbon dioxide annually and producing 27 tons of carbon materials, making UP Catalyst one of the largest providers of green graphite in the world.
The round was led by Berlin-based climate tech VC fund Extantia and supported by Estonia’s state fund SmartCap, along with the continued participation of existing investors Sunly, Little Green Fund, Scottish Baltic Invest and UniTartu Ventures.
The investment will be instrumental in UP Catalyst’s quest to scale up its production capabilities. The new reactor will have a production capacity ten times larger than the current setup and marks an important milestone before the construction of a full-scale industrial reactor unit.
The global demand for graphite to outstrip supply
Mart Maasik, the CEO of the University of Tartu’s investment company, UniTartu Ventures, said the company applying intellectual property created at the university is reaching the threshold of a rapid growth phase.
“The involvement of new investors proves UP Catalyst’s capabilities. The company’s team has a deep understanding of the field’s trends, and its activities are linked to several applied science grants and international consortia implementing these projects,” Maasik said, adding that UP Catalyst’s increasing collaboration with the University of Tartu ensures the broader development of this field of science in Estonia.
With the global demand for graphite expected to outstrip supply, creating an estimated 700,000-ton annual deficit by 2030, UP Catalyst is positioned to become a transformative force in the European battery landscape. By replacing fossil-based graphite with UP Catalyst green graphite, the battery anodes will become carbon dioxide-negative. This shift could contribute to avoiding 118.7 megatons of carbon dioxide emissions annually by the year 2030, marking a substantial environmental impact.
UP Catalyst is closely linked with the University of Tartu – the founders of the company have successfully completed the university’s pre-incubation program From Science to Business!, and since 2022, UP Catalyst has been part of the portfolio of UniTartu Ventures. Additionally, this year, the company was awarded the title of the University of Tartu’s Research-Intensive Spin-off of the Year.