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The UK is becoming a hotbed for climate tech, with investments totalling $7.5 billion. This is almost double the investment total of 2021. Climate tech has seen incredible growth over the last year, with more than 5,200 companies in the sector.
The UK also currently has eight unicorn climate tech businesses, and with 19 more expected to have a unicorn valuation over the next year, this shows great progression for the industry, which is focused on reducing carbon emissions.
However, this should not be a surprise. The need to focus on the climate crisis is undeniable. While other sectors may suffer from the effects of tough economic times in the coming year, climate tech appears to be an industry of resilience. The climate crisis is not ending and posing a more significant threat than ever. Investors actively seek climate tech opportunities, which creates a "win-win" scenario; climate tech businesses get the funding they need to tackle the climate crisis, while investors look to make over a 30% return from climate tech.
This is great news, as recent polls conducted by Zero Global found that 94% of people felt that world leaders at COP27 this year did not take enough action to tackle the climate crisis. While there was significant progress in some areas, multiple options for reducing carbon emissions are needed fast. The fact that more investors at COP27 this year came together to make active investments in climate tech demonstrates that this is something to be taken seriously.
Investment hasn’t just been in the UK. Globally there has been an upturn in investment in climate tech. Tech Nation estimated over 44,000 climate tech companies are operating worldwide. These businesses operate under different verticals within climate tech; some include energy, farming, greenhouse gas removal and circular economy. While these verticals appear to have different priorities, the fundamental driver of all climate tech verticals is to reduce greenhouse gasses.
Tech Nation report estimated that with the 44000+ climate tech companies worldwide, the emission reduction potential of these technologies together could surpass 2019 emissions by 2036. This means collectively, these companies will be removing more carbon from the atmosphere than the world produced in 2019 by 2036. This would be a phenomenal achievement for the world.
A fundamental change in how we operate as a society and economically is required to stop the acceleration of the climate crisis; Climate tech is currently at the heart of making real change possible through innovation, reinvention and putting climate change at the centre of their purpose.