Greentown Labs CEO on climate tech's next steps

• Axios chatted with Kevin Knobloch, who became Greentown CEO last September, on CERAWeek's sidelines.

The intrigue: Asked what's a below-radar topic, Knobloch said startups will help meet Energy Department efficiency rules issued under former President Obama for various kinds of appliances and equipment.

• "I'd like for us to recruit more companies in that space," said Knobloch, who was DOE's chief of staff during Obama's second term.
• Manufacturers "have to go back to the drawing board and come up with technology solutions."
• Elsewhere, he cited the need for more progress on difficult-to-decarbonize sectors — and talked up several Greentown Houston companies like Hertha Metals and Elemental Advanced Material.

The big picture: "It's a challenging time to be a startup in any sector, but certainly in the climate tech, clean energy sector ... because of high interest rates," he said.

• "Even if the Fed starts to moderate, it's going to take a long time to come back down. So the cost of debt financing is high."

What we're watching: The 2022 climate law provides a "direct pay" option for clean energy tax credits, which means companies that lack tax liability can still tap incentives.

• "As they get closer to graduating from the incubator stage, and/or if they partner with a corporate partner ... I do see them being able to step up and take advantage of those," Knobloch says.