Rice Acquisition Corp. II (NYSE: RONI), a special purpose acquisition company (SPAC) focused on supply-side decarbonization solutions, and NET Power, LLC today announced an agreement to establish a partnership to scale NET Power’s technology globally and go public on the NYSE under the NPWR ticker.
The deal is worth $1.46 billion and is expected to be completed in Q2 of 2023, following a series of milestones for NET Power that have proven the viability of its technology.
In November 2021 the company’s demonstration facility was successful in synchronizing to the grid in a first for its patented oxy-combustion and supercritical CO2 technology. NET Power describes it as a high-efficiency cycle that can capture over 97% of CO2 which can then be utilized or stored, in effect turning natural gas into a carbon neutral power source.
The success of the test facility was followed by a strategic partnership with Baker Hughes in 2022 for the design and manufacturing of plant equipment.
The partnership and public listing will see a change in leadership with the current CEO of NET Power Ron DeGregorio succeeded by Danny Rice, director of RAC II and former CEO of Rice Energy, Inc.
“We have long believed that if you can use natural gas, generate reliable electricity, and capture the resulting emissions, you would change the world. For over a decade, NET Power has worked tirelessly to prove its game-changing technology, which we did through our demonstration facility in La Porte, Texas,” said Ron DeGregorio.
“Following the strategic investment and partnership with Baker Hughes to deliver key turbomachinery for future NET Power plants, this transaction properly capitalizes NET Power and enables the company to commercialize this revolutionary technology. The Rice Group is a logical strategic partner, and I am excited to hand the reins to Danny to lead NET Power,” he added.
Incoming CEO Danny Rice said, “Today, around 60% of global power generation comes from coal and natural gas-fired power plants that produce reliable and low-cost power. However, these plants collectively emit nearly 14 billion tonnes of CO2 per year, accounting for approximately 37% of total global emissions. By replacing these plants with NET Power’s proven technology, we can eliminate nearly 100% of these emissions while providing reliable and low-cost power that people deserve.”
Occidental is one of the partners in the project and is working on incorporating NET Power plants into Direct Air Capture hubs that are being developed by its 1PointFive subsidiary in partnership with Carbon Engineering.
Vicki Hollub, President and CEO of Occidental, said, “We first invested in NET Power because we believe the technology can accelerate Oxy’s efforts to reduce emissions in our existing operations andd ultimately supply emissions-free power to the Direct Air Capture sites and sequestration hubs we are developing.”
The partnership has $235 million in committed investments that will support it in the coming years before commercialization. The investments come from the Rice family, Occidental, Constellation Partners, HITE Hedge, NGP Capital and 8 Rivers. The latter is also a founding partner of NET Power.
Cam Hosie, CEO of 8 Rivers, said, “8 Rivers is proud to have supported NET Power from the beginning, and we will continue to support NET Power’s global deployment by leveraging our commercial and project management expertise while driving deployments through our net-zero solutions business, Zero Degrees.”
Power generation (mainly from coal and natural gas) is the single largest emitter of greenhouse gas emissions with over 14 billion tonnes of CO2 released in the atmosphere every year. The addressable market according to the company is approximately 17,000 plants that could ultimately use its technology.