In Squamish, British Columbia, a Canadian town halfway between Vancouver and Whistler where the ocean meets the mountains, a startup led by Harvard physicist David Keith – and funded in part by Bill Gates – is building an industrial plant to capture carbon dioxide from the air.

Carbon Engineering aims to eventually build enough plants to suck many millions of tons of CO2 out of the air to reduce climate change. Its technology could help capture dispersed emissions – that is, emissions from cars, trucks, ships, planes or farm equipment – or even to roll back atmospheric concentrations of CO2.

The Calgary-based company is one of a crop of startups placing bold bets on technology designed to directly capture CO2 from the air. Lately, at least three have shown signs of progress. New York City-based Global Thermostat, which is led by Peter Eisenberger, a Columbia University professor and former researcher for Exxon and Bell Labs, tells me it has recently received an infusion of capital from an as-yet-unnamed US energy company. As part of a demonstration project financed by Audi, Swiss-based Climeworks in April captured CO2 from the air and supplied it to a German firm called Sunfire, which then recycled it into a zero-carbon diesel fuel.

All three companies talk about a hypothetical future in which CO2 will be harvested from the sky and transformed, using renewable energy, into low-carbon fuels. “How do you power global transportation in 20 years in a way that is carbon neutral?” asks Geoff Holmes, business development manager at Carbon Engineering. “Cheap solar and wind are great at reducing emissions from the electricity. Then you are left with the transport sector.”

Beyond that, if direct air capture of CO2 gets cheap enough – or if the climate crisis becomes dire – carbon extracted from the air could also be sequestered in the ocean or underground.

Carbon Engineering, Global Thermostat and Climeworks all sprung up during the mid-to-late-2000s, when it looked as if the world’s governments might take aggressive action to curb climate change. Mostly, they haven’t. Since then, the three startups have been refining their technology, raising capital and very gradually bringing CO2 capture closer to a commercial reality.

But all three startups lack a practical business model. At this time, no one will pay them just to take CO2 out of the air. And the market for CO2 – which has a variety of uses, from injecting bubbles into fizzy drinks to recovering hard-to-get-oil from tapped-out wells – is limited.

What’s more, if direct air capture of CO2 is to emerge as a meaningful climate solution, it would have to be built out at a global, industrial scale, costing billions of dollars.

Still, while direct air capture won’t be ready for deployment any time soon, climate experts say negative emissions technologies merit more attention. In a detailed review of climate intervention technologies published in February, The National Academies of Sciences described direct air capture as “an immature technology” and called on the government to invest in research “to improve methods of carbon dioxide removal and disposal at scales that would have a significant global climate impact”.

“Scientists are increasingly convinced that we are going to need large scale removal systems to fight climate change,” says Noah Deich, who recently started the Berkeley, California, nonprofit Center for Carbon Removal. “I’m excited about direct air capture. It could be a really important technology to add to the portfolio.”

That’s because evidence is mounting that even a rapid buildout of low-carbon energy sources like solar and wind won’t keep global temperatures from rising beyond the 2C limit to which governments have agreed. “The climate policy mantra – that time is running out for 2C but we can still make it if we act now – is scientific nonsense,” Oliver Geden, head of research at the German Institute for International and Security Affairs, wrote recently in the Nature journal. The Intergovernmental Panel on Climate Change says technologies to remove carbon from the atmosphere will be needed to stay within the 2C limit.

But until governments are willing to pay for carbon removal and storage, the three air-capture startups will need commercial customers that can keep them afloat in case they are needed, potentially decades from now, as a climate solution. All are aiming to make low-carbon fuels, using recycled CO2 and renewable energy to power the process.

“We’re really getting excited about .direct fuel synthesis,” Holmes says. The Squamish demonstration plant, built on an abandoned industrial site, will capture only about 500 tons CO2 per year, which is barely enough to offset the emissions of 33 average Canadians. That’s so little that it’s being released back into the air. “We’re not claiming any environmental benefit, yet,” Holmes says.

But Carbon Engineering would like to be able to split water into hydrogen and oxygen, and then combine the hydrogen with CO2 to make a diesel fuel that could power local buses or be exported to California, which subsidizes low-carbon fuels.

Working with Audi, Climeworks has already produced a small batch of what the auto company calls zero-carbon e-diesel. Climeworks is also building a plant to collect CO2 from the air and supply it to a nearby greenhouse to grow plants. But “the reason we come to work is to make synthetic fuels”, cofounder Christopher Gebald says.

As for Global Thermostat, Graciela Chichilnisky, the CEO and a co-founder with physicist Eisenberger, says the company will soon have news about a multimillion dollar investment from a US energy company. Edgar Bronfman Jr, the former chairman and CEO of Warner Music, has been Global Thermostat’s biggest investor to date.

The open question for all three startups is whether any can raise enough money – and sustain enough cashflow – in the short term for their efforts to matter in the long term.