The Seven Trillion In Ten Years Opportunity

Did this newsletter get shared with you? You can sign up here. 

To me, it's just so obvious that, if done right, it is possible to make an attractive return while investing in climate tech. Still, explaining it on paper took us 25 (nicely designed) pages.

Together with Bas van Beijeren, our Investment Director, and Rikkert Beerekamp, our Head of Professional Solutions, we built our argument by taking you through climate tech's market growth, historical returns and developments in the fund landscape.

Here are my favorite insights:

💰 Climate technologies’ yearly revenues are expected to grow from €5 trillion in 2020 to €12 trillion in 2030, an annual compound growth rate of 10%
🤑 Climate tech, such as renewable power and electric vehicles, are already at or about to reach price parity with incumbent tech—about 80% of climate technologies needed for net zero have a clear pathway toward cost parity
📊 Climate tech VC currently attracts $50 billion in investments per year, making it 16% of all venture capital and growth equity was invested in climate tech in 2023, more than tripling in ten years
📈 Climate tech VC has been much more resilient than general VC—12% vs 50%+ decline over the last two years
👥 More and more mainstream PE fund managers are stepping into climate tech because they don't want to miss out

I also spent a significant amount of time diving into the fundamental long-term drivers of a successful climate tech market. This uncovered five key drivers:

1. Efficiency and learning curves are driving climate tech cost competitiveness—already leading to exponential growth in solar, wind, EVs and batteries.
2. Geopolitical competition, driven by energy security, is redefining the rules of the game—with governments investing trillions into climate tech to win.
3. Corporates are giving clear demand signals—to capture early mover green premiums and stay competitive in the longer term.
4. Institutional investors are increasingly putting their money where their mouth is—with 200+ planning to increase their transition allocations in the next 1-3 years.
5. Individuals choose sustainability in their jobs and consumer behaviors—and are willing to pay for it.

Want to dive deep into our latest thoughts on the climate tech investment opportunity? Download the full whitepaper here.

‍

💡 Carbon Equity updates

We're excited to share strong traction in our Climate Tech Portfolio Fund III. Now, it’s time to deploy that into underlying climate funds, so we’ve started working toward the fund's first close. You can learn more about the fund and ask any questions you may have in our upcoming webinar. Register here.

Jacqueline, our Co-Founder and CEO, joined BNR’s Big Five to discuss her entrepreneurial journey and how making money from helping solve climate change is not dirty. You can listen to it here (in Dutch). She also joined TechEU’s podcast to discuss the urgency of mobilizing capital to climate solutions. Listen to that one here.

We wanted to thank all of those who joined our events last month in Antwerp 🇧🇪 and Oslo 🇳🇴 to make them informative and inspiring sessions. These “State of Climate Tech” events were hosted together with industry leaders like Breakthrough Energy Ventures and Norrsken.

We're seeking a Germany Country Manager, Content Marketeer and Professional Investor Relations Manager to join our team. You can find the vacancies here—please feel free to share them with your network!

‍

💡 News from within our funds

H2 Green Steel has signed another seven-year offtake agreement for its renewable hydrogen-based steel with building ventilation supplier Lindab. From 2026, Lindab will buy 159,000 tonnes of steel a year.

Sunfire’s CEO, Nils Aldag, was awarded Founder of the Year by the German Startup Association. As of 2024, Sunfire has 650+ employees, installed one of Europe’s largest electrolyzers making green hydrogen and recently secured €500 million in funding.

Sublime Systems announced the first-ever commercial application of its low-carbon Sublime Cement™. The concrete placement is located at One Boston Wharf, Boston's largest net-zero-carbon office building.

Relectrify develops longer-lasting battery cells that don’t need inverters—at a time when a global inverter shortage has limited battery projects. We joined its recent 17 million AUD funding round through At One Ventures.

You can explore more companies within our funds here.

‍

📚 Interesting reads

What Now for the Greenhouse Gas Reduction Fund Green Finance Programs?
In April, the U.S. Environmental Protection Agency (EPA) announced $27 billion in competitive grants to 68 awardees under the Greenhouse Gas Reduction Fund. While the fund was created in 2022 under the Inflation Reduction Act (IRA), no capital had been allocated from it until now. Rumor has it, the EPA decided to give out all the cash at once in case the next president decides to end the program.

Symbiosis Coalition
Google, Meta, Microsoft and Salesforce formed a coalition to set new standards for high-quality, nature-based carbon removal credits and committed to buying 20M tons of them by 2030. Nature restoration is essential to meeting the world’s climate goals, but faulty credits have damaged its reputation. By showing a willingness to pay the costs of high-quality projects, this coalition hopes to inspire others to do the same.

Better real-time data for the country’s congested transmission lines
Electricity grids are severely limiting our ability to electrify further. Enabling grid tech can help us push more power through the grid before we do costly hardware updates. One example: by monitoring its actual temperature, rather than prescribed maximums, grid lines can typically transport 10-30% more electricity. Companies are starting to install these sensors worldwide.

A climate tech world tour
Not all climate tech markets are created equal. What technologies are funded most depends on regional factors such as government policies, market demand, existing infrastructure, renewable energy resources and corporates. The latest work from CTVC takes you on a tour across the globe to see which business models are backed most in certain countries.

UNSUSTAINABLE: The biodiversity data gap
While Carbon Equity focuses on mitigating greenhouse gas emissions, we do track other impact themes. In recent months, the conversation on biodiversity has been picking up. The drivers include a big commitment at COP15 in 2022 and the EU Corporate Sustainability Reporting Directive (CSRD)*, which will require 50,000 companies to report on biodiversity. The biggest challenge? Data.