{"id":81011,"date":"2024-01-02T17:20:14","date_gmt":"2024-01-03T01:20:14","guid":{"rendered":"https:\/\/techreviewers.net\/whats-in-store-for-europes-climate-tech-ecosystem-in-2024\/"},"modified":"2024-01-02T17:20:14","modified_gmt":"2024-01-03T01:20:14","slug":"whats-in-store-for-europes-climate-tech-ecosystem-in-2024","status":"publish","type":"post","link":"https:\/\/techreviewers.net\/whats-in-store-for-europes-climate-tech-ecosystem-in-2024\/","title":{"rendered":"What\u2019s in store for Europe\u2019s climate tech ecosystem in 2024"},"content":{"rendered":"
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It has been a rough year for climate tech<\/a>. While it fared slightly better than other sectors, t<\/span>otal venture and private equity <\/span>investment<\/span><\/a> in planet-saving technologies fell 40% this year, down to a five-year low.\u00a0<\/span><\/p>\n

It\u2019s not all doom and gloom, however. For one, the EU enacted the Green Deal Industrial Plan, which makes over <\/span>\u20ac1trn available for everything from EVs<\/a> and carbon capture plants to battery storage and green hydrogen.\u00a0<\/span><\/p>\n

Moreover, we\u2019ve witnessed the rapid rise of AI which promises to bring unprecedented efficiencies to the production and operation of clean technologies. Hard-to-decarbonise but heavily polluting sectors like the built environment and industry are also receiving an <\/span>increasing share<\/span><\/a> of investment \u2014 a promising step toward net zero.\u00a0<\/span><\/p>\n

We expect these trends to continue into 2024. And while a recent Pitchbook <\/span>report<\/span><\/a> indicates the new year will still bring significant funding challenges, many in the sector are optimistic.<\/span><\/p>\n

\u201c<\/span>With the looming interest rate turnaround, governmental initiatives, and increased private sector interest, we will see an uptick in investments in the tech sector in general and European greentech startups in particular,\u201d Lubomila Jordonova, CEO at Berlin-based carbon accounting firm PlanA, tells <\/span>TNW.<\/span><\/p>\n

AI, AI everywhere<\/b><\/h2>\n

Perhaps unsurprisingly, the <\/span>meteoric<\/span> rise of artificial intelligence systems doesn\u2019t look to be slowing down anytime soon. <\/span>Its market value of nearly $100bn now is expected to grow twentyfold to $2trn by 2030.<\/span><\/p>\n

In climate tech, AI has almost unlimited potential, from making <\/span>buildings<\/span><\/a> more energy efficient and <\/span>power plants<\/span><\/a> cheaper to run, to improving climate <\/span>forecasting<\/span><\/a> and helping to cut down on <\/span>water waste<\/span><\/a>.\u00a0\u00a0<\/span><\/p>\n

Going into 2024, Sierra Peterson<\/span>, climate tech investor and founder at Voyager VC, <\/span>foresees that founders will shift their focus from large language models like ChatGPT and onto more specific AI applications.\u00a0<\/span><\/p>\n

\u201cWe believe there are more intriguing challenges to tackle in the physical realm,\u201d says the investor. \u201cExamples include refining battery chemistries and form factors to enhance energy storage capacity and devising intricate metabolic pathways for microbes to convert CO2 into valuable products.\u201d<\/span><\/p>\n

We could also see AI disrupt more legacy industries like waste management, construction and water, which have traditionally lagged behind on the innovation front despite being massive contributors to carbon emissions.\u00a0<\/span><\/p>\n

However, while AI could help save the planet, the elephant in the room is the huge amounts of energy required to run these systems. T<\/span>he graphic processing units that AI uses tend to use <\/span>four times as much power<\/span><\/a> as the servers used for cloud applications. They also <\/span>require vast amounts of water<\/span><\/a> for cooling.\u00a0<\/span><\/p>\n

\u201cLegislation in the UK and the EU around greener computing is on the horizon, which will drive IT decision makers to start looking at how they can keep ahead or in line with these initiatives,\u201d says <\/span>Dinesh Majrekar, CTO of British cloud service provider Civo.<\/span><\/p>\n

As of January 1, 2024, 50% of the electricity consumed by German data centres must be covered by electricity from renewable sources. From 2027, the requirement will be 100%.<\/span><\/p>\n

Stringent reporting requirements\u00a0\u00a0\u00a0<\/b><\/h2>\n

In recent years, ESG reporting has gone from a nice-to-have to a must-have for corporates, creating massive demand for tools to help businesses measure, monitor, and reduce their impact.\u00a0<\/span><\/p>\n

And in 2024, legislation is getting a whole lot tougher as the Corporate Sustainability Reporting Directive (CSRD) comes into force. The law tightens the sustainability reporting requirements for large companies and SMEs, <\/span>meaning organisations must put greater emphasis on accurately collating and reporting their data.<\/span>\u00a0<\/span><\/p>\n

\u201cAs such, investing in smart tech solutions to monitor and optimise performance will become even more critical when it comes to businesses maintaining credibility and futureproofing,\u201d explains Don McLean, CEO at Scottish digital<\/span> twin experts IES, which <\/span>creates software tools for designing and operating energy efficient buildings.<\/span><\/p>\n

With the CSRD buttressing Europe\u2019s already strict reporting regulations, many experts we spoke to believe that European businesses are poised to become world leaders in ESG. This will drive demand for tools to make the data collection and auditing process as smooth as possible \u2014 a huge opportunity for startups.<\/span><\/p>\n

\u201cIn 2024, I think sustainability will evolve from superficial ESG messaging to real-world impact,\u201d says Patrik Backman, general partner at software-based VC OpenOcean. \u201cCompanies will be challenged to prove concrete ESG progress, not just noble intentions. This will separate leaders truly driving change from those simply capitalising on the hype.\u201d\u00a0<\/span><\/p>\n

Watch out corporate Europe \u2014 greenwashing will no longer be enough.\u00a0<\/span><\/p>\n

Tackling the tough stuff<\/b><\/h2>\n

While the bulk of climate tech cash has thus far been funnelled towards energy and mobility, investment is gaining momentum in tough-to-decarbonise sectors like industry, agriculture, and the built environment. <\/span>Whereas, globally, investors directed just under 8% of startup funding to industrials between 2013 and 2022, they <\/span>invested<\/span><\/a> 14% in the sector between Q4 2022 and Q3 2023.<\/span> \u00a0\u00a0<\/span><\/p>\n

\u201c<\/span>Never before have we witnessed this level of energy and resolve among founders in transforming the physical world of buildings and factories, ships and planes, and power plants,\u201d says Peterson. <\/span>Stockholm-based <\/span>H2 Green Steel\u2019s <\/span>\u20ac1.5bn raise<\/span><\/a> this September \u2014 Europe\u2019s biggest funding round of the year \u2014 is indicative of this shift.\u00a0<\/span><\/p>\n

Going into the new year, the Carbon Border Adjustment Mechanism (CBAM) is also expected to accelerate European demand for decarbonised manufacturing and heavy industry. The <\/span>act, which came into force in September, puts a carbon tariff on carbon intensive products, such as cement, as is intended to drive innovation in low carbon industry and materials.\u00a0\u00a0<\/span><\/p>\n

Other areas to watch include startups working to decarbonise <\/span>construction<\/span><\/a> and housing, which contribute a combined 40% of global emissions, as well as <\/span>shipping<\/span><\/a>, <\/span>aviation<\/span><\/a>, and chemical production.\u00a0\u00a0<\/span><\/p>\n

Carbon removals\u00a0<\/b><\/h2>\n

While sucking carbon out of the air was considered pretty far-fetched just a few years ago, <\/span>scientists<\/span><\/a> now deem the technology absolutely essential to limiting global warming to 1.5<\/span>\u00b0C above pre-industrial levels.\u00a0<\/span><\/p>\n

2023 was undoubtedly the breakout year for the budding carbon dioxide removal (CDR) industry, which <\/span>at one point in the year <\/span>tripled its valuation in just two months<\/span><\/a> thanks to a number of major deals. This included banking giant JPMorgan Chase buying nearly \u20ac200mn worth of carbon removal credits through a nine-year agreement with Swiss <\/span>direct air capture startup Climeworks<\/span><\/a>. <\/span>
<\/br> <\/span>
<\/br> <\/span>Direct air capture isn\u2019t the only CDR technology gaining ground. Several European startups are pioneering enhanced weathering and biochar techniques, which accelerate natural processes for drawing <\/span>CO\u2082 out of the air.<\/span>\u00a0<\/span><\/p>\n

For instance, Irish startup <\/span>Silicate<\/span><\/a> throws crushed waste concrete on farmland. The dust quickly mineralises, pulling carbon from the air and into the soil where it eventually enters rivers and flows into the ocean \u2014 locking it up for thousands of years.\u00a0<\/span><\/p>\n

Carbon removal credits are also gaining ground as a more scientifically sound means of offsetting emissions, compared to the recently disgraced \u201c<\/span>probably junk<\/span><\/a>\u201d carbon offset credits.\u00a0<\/span><\/p>\n

\u201cAfter a year of controversy in the voluntary carbon market, buyers and sellers are demanding greater transparency and evidence to back up project claims,\u201d <\/span>Oliver Carpenter, director of environmental risk analytics at Risilience, tells TNW<\/span>.<\/span>\u00a0\u00a0<\/span><\/p>\n

Going forward, Carpenter expects to see greater use of remote sensing and geospatial data analysis to monitor projects and judge their claims.\u00a0<\/span><\/p>\n

Going beyond carbon<\/b><\/h2>\n

Some years back, I spoke to a founder who believed the tech world had developed what she called \u201ccarbon myopia.\u201d Amidst the frantic scramble to mitigate climate change, we\u2019ve forgotten to invest in technologies that help us adapt to its impacts, she said. Think floods, droughts, storms, and wildfires.\u00a0\u00a0\u00a0<\/span><\/p>\n

While adaptation technologies have historically received just a <\/span>small proportion<\/span><\/a> of total climate tech funding, there is a growing business case to reverse this trend.\u00a0<\/span><\/p>\n

\u201cPerceptions are changing,\u201d says Taco Engelaar, managing director for Europe at energy infrastructure firm Neara. \u201cIn 2024, we can expect to see the conversation centre increasingly around technology which climate-proofs our futures \u2014 rather than offsets damage \u2014 and keeps people safe and connected during what were previously \u2018once in a generation\u2019 weather events.\u201d<\/span><\/p>\n

This includes <\/span>water-recycling tech<\/span><\/a> that improves our resilience to droughts, <\/span>solar-powered sensors<\/span><\/a> in the forest that smell a wildfire before it burns out of control, and AI-powered <\/span>weather forecasting<\/span><\/a> tools to predict the next extreme weather event.\u00a0<\/span><\/p>\n

Battling climate change will require the swift scaling of both mitigation and adaptation measures. While innovation is indeed vital, many of the technologies we need to avert the worst impacts of global heating are already available today.\u00a0\u00a0<\/span><\/p>\n

With 2023 set to be the <\/span>hottest on record<\/span><\/a>, 2024 needs to be a year of action for Europe\u2019s climate tech ecosystem. <\/span><\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

It has been a rough year for climate tech. While it fared slightly better than other sectors, total venture and private equity investment in planet-saving technologies fell 40% this year, down to a five-year low.\u00a0 It\u2019s not all doom and gloom, however. For one, the EU enacted the Green Deal […]<\/p>\n","protected":false},"author":38,"featured_media":81012,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"ocean_post_layout":"","ocean_both_sidebars_style":"","ocean_both_sidebars_content_width":0,"ocean_both_sidebars_sidebars_width":0,"ocean_sidebar":"","ocean_second_sidebar":"","ocean_disable_margins":"enable","ocean_add_body_class":"","ocean_shortcode_before_top_bar":"","ocean_shortcode_after_top_bar":"","ocean_shortcode_before_header":"","ocean_shortcode_after_header":"","ocean_has_shortcode":"","ocean_shortcode_after_title":"","ocean_shortcode_before_footer_widgets":"","ocean_shortcode_after_footer_widgets":"","ocean_shortcode_before_footer_bottom":"","ocean_shortcode_after_footer_bottom":"","ocean_display_top_bar":"default","ocean_display_header":"default","ocean_header_style":"","ocean_center_header_left_menu":"","ocean_custom_header_template":"","ocean_custom_logo":0,"ocean_custom_retina_logo":0,"ocean_custom_logo_max_width":0,"ocean_custom_logo_tablet_max_width":0,"ocean_custom_logo_mobile_max_width":0,"ocean_custom_logo_max_height":0,"ocean_custom_logo_tablet_max_height":0,"ocean_custom_logo_mobile_max_height":0,"ocean_header_custom_menu":"","ocean_menu_typo_font_family":"","ocean_menu_typo_font_subset":"","ocean_menu_typo_font_size":0,"ocean_menu_typo_font_size_tablet":0,"ocean_menu_typo_font_size_mobile":0,"ocean_menu_typo_font_size_unit":"px","ocean_menu_typo_font_weight":"","ocean_menu_typo_font_weight_tablet":"","ocean_menu_typo_font_weight_mobile":"","ocean_menu_typo_transform":"","ocean_menu_typo_transform_tablet":"","ocean_menu_typo_transform_mobile":"","ocean_menu_typo_line_height":0,"ocean_menu_typo_line_height_tablet":0,"ocean_menu_typo_line_height_mobile":0,"ocean_menu_typo_line_height_unit":"","ocean_menu_typo_spacing":0,"ocean_menu_typo_spacing_tablet":0,"ocean_menu_typo_spacing_mobile":0,"ocean_menu_typo_spacing_unit":"","ocean_menu_link_color":"","ocean_menu_link_color_hover":"","ocean_menu_link_color_active":"","ocean_menu_link_background":"","ocean_menu_link_hover_background":"","ocean_menu_link_active_background":"","ocean_menu_social_links_bg":"","ocean_menu_social_hover_links_bg":"","ocean_menu_social_links_color":"","ocean_menu_social_hover_links_color":"","ocean_disable_title":"default","ocean_disable_heading":"default","ocean_post_title":"","ocean_post_subheading":"","ocean_post_title_style":"","ocean_post_title_background_color":"","ocean_post_title_background":0,"ocean_post_title_bg_image_position":"","ocean_post_title_bg_image_attachment":"","ocean_post_title_bg_image_repeat":"","ocean_post_title_bg_image_size":"","ocean_post_title_height":0,"ocean_post_title_bg_overlay":0.5,"ocean_post_title_bg_overlay_color":"","ocean_disable_breadcrumbs":"default","ocean_breadcrumbs_color":"","ocean_breadcrumbs_separator_color":"","ocean_breadcrumbs_links_color":"","ocean_breadcrumbs_links_hover_color":"","ocean_display_footer_widgets":"default","ocean_display_footer_bottom":"default","ocean_custom_footer_template":"","ocean_post_oembed":"","ocean_post_self_hosted_media":"","ocean_post_video_embed":"","ocean_link_format":"","ocean_link_format_target":"self","ocean_quote_format":"","ocean_quote_format_link":"post","ocean_gallery_link_images":"on","ocean_gallery_id":[],"footnotes":""},"categories":[2672,2644,2612,397,2666,2696],"tags":[2671,2643,2611,395,2665,2695],"_links":{"self":[{"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/posts\/81011"}],"collection":[{"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/comments?post=81011"}],"version-history":[{"count":0,"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/posts\/81011\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/media\/81012"}],"wp:attachment":[{"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/media?parent=81011"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/categories?post=81011"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/techreviewers.net\/wp-json\/wp\/v2\/tags?post=81011"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}