Dec 16, 2021 - Energy & Environment

"Untapped potential" in climate tech investments

Investment in climate tech startups, by category
Data: PwC; Chart: Thomas Oide/Axios

Private investment into climate technologies is surging, but there's misalignment between where the money is going and areas with the highest potential for slashing emissions, a new report finds.

Driving the news: PwC is out with a wide-ranging look at climate tech funding and deals. Venture capital and private equity investment surged in the second half of 2020 and the first half of 2021 (the end of the period studied), totaling $87.5 billion.

  • Climate tech, broadly defined, now accounts for 14 cents of every VC dollar invested.

Yes, but: "Our analysis finds that there are still significant areas of untapped potential," the report states.

  • "Of the 15 technology areas analysed, the top five that represent over 80% of future emissions reduction potential by 2050 received just 25% of recent climate tech investment between 2013 and H1 2021."
  • The top five in their analysis are "Solar Power, Wind Power, Food Waste Technology, Green Hydrogen Production, and Alternative Foods/Low GHG Proteins."

Of note: The report doesn't aim to capture the whole investment landscape. PwC notes it explored "funding targeted at scaling new innovations," and not project finance for mature tech and debt.

Go deeper: Carbon capture firm nabs $30M in VC funds

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