Climate Technology Finance

India needs to add ~46 GW of renewable capacity every year through 2030 to hit its 500 GW target. It added 45 GW of solar in FY2026. So the math works, as long as you diversify from utility-scale parks that take 18–24 months from bid to synchronisation. The faster path runs through distributed energy: rooftop solar, Commerical and Industrial open access, agricultural pumps, behind-the-meter storage. India installed 8.7 GW of rooftop solar in FY2026 alone — a 69% year-on-year jump. Open access solar crossed 30 GW cumulative. A 500 kW rooftop system commissions in 60–90 days. A 5 MW C&I open access project in under six months. These aren't niche numbers anymore. But there's a bottleneck that doesn't get enough attention: working capital. Solar EPCs — especially SMEs — routinely win projects they can't fully fund through procurement. Traditional bank credit is slow, collateral-heavy, and sized for larger tickets. The result: equipment delays, missed milestones, compressed margins. This is exactly where Odyssey Energy Solutions has built something interesting. Their supply chain credit model — proven across Africa and Latin America — is now live in India. Credit without collateral, milestone-aligned repayment, embedded directly into the procurement workflow. An EPC can place a module order with 100% upfront payment to the supplier, secure better pricing, and repay as customer milestones arrive. One case: a leading Indian EPC with 700+ MW in its order book used Odyssey's platform to execute nearly 200 MW across four states — Chhattisgarh, Karnataka, Rajasthan, and Madhya Pradesh — without straining working capital. India doesn't lack solar resource, manufacturing capacity, or demand. Module production jumped from 38 GW to 74 GW in a single fiscal year. The constraint is deployment velocity — and deployment velocity is a financing problem as much as a policy problem. Companies solving the financing layer for distributed energy in India are working on something structurally important. Worth watching. #India #SolarEnergy #DistributedEnergy #CleanEnergy #EnergyTransition #RenewableEnergy #ProjectFinance

Alastair Marsh's recent thought-provoking piece in @Bloomberg highlights critical challenges with the current climate tech investing landscape Climate tech projects are capital-intensive with long timelines. Unlike software, much of climate tech requires massive upfront capital for R&D, pilot plants, and manufacturing before significant revenue. This demands longer development and deployment cycles (often 7+ years to scale) that exceed typical 5-7 year VC exit horizons. The classic VC model - built for rapid, asset-light scale-ups - often misaligns with the realities of many climate tech solutions, especially "hard tech." While there’s an abundance of early-stage VC capital for entrepreneurs, later-stage growth that bridges these projects from venture to infrastructure stage is basically absent—that’s called the missing middle. We need to adapt and supplement that approach by layering in other types of capital and bridge the "missing middle." A broader array of financing instruments is essential for climate tech to scale, including patient equity and growth capital, project finance, blended finance, and specialized debt models. Marsh’s piece lays out how family offices are uniquely positioned to be catalyzing players in this space. Their flexibility allows them to deploy capital across diverse segments, filling the gap and driving significant financial returns alongside impact. https://lnkd.in/gUf85Bwy

Blackrock just took a big write-down on its Global Renewable Power Fund III. Because of two ill-fated investments in Northvolt and SolarZero. Surprisingly, a $4.8 billion fund saw its internal rate of return plummet due to just two portfolio companies faltering. This fund was BlackRock's third flagship GRP fund, part of its bet on the energy transition and a push towards renewable energy and infrastructure. Many of the funds’s assets are early-stage climate infrastructure investments in: EV charging, renewable generation, and power storage and transmission. Are they simply making bad investments or is this a prequel to what to expect? What this tells me about climate tech investing: 1. The significant impact of two companies on a $4.8 billion fund suggests that traditional risk models needs reevaluation. The conventional playbook for diversification doesn't quite work in climate tech. When companies in your portfolio are all betting on similar technological advances or regulatory shifts, they tend to sink or swim together. Traditional risk models might be missing these hidden correlations. 2. The Northvolt situation is a wake-up call - throwing money at climate tech isn't enough. These companies need investors who roll up their sleeves and get involved. We're seeing a shift from passive to active investing, where deep operational expertise is just as crucial as the capital itself. 3. SolarZero, a major player in New Zealand Energy Sector, was far from an early-stage startup when BlackRock acquired it in 2022. Despite its 50-year history , something went wrong. It hints at a broader challenge: global funds rushing into new markets might be overlooking local market dynamics and regional complexities in their eagerness to deploy capital in the renewable space. As this sector matures, we need a new framework for resilient investment strategies that can better weather the failures of individual companies while capitalizing on the overall growth trend in clean energy. #climatetech #VC #investment #newbook #fundclimatetech #blackrock Link for the news in the comments.

In 2025, sustainability won't sell itself. "Doing the right thing" won't get your project funded. If you're leading strategy, pitching a new line item, or defending impact budget you need a business case that speaks the language of finance, ops, and leadership. Here’s your cheat sheet. 6 proven angles to justify sustainability and real-world proof points to back them up: 💸 1. Cost Savings → Energy efficiency: Vodafone UK & Ericsson cut 5G power use by up to 33% at London sites. → Circularity: Patagonia’s Worn Wear turns repair into a revenue-positive loyalty loop. 📈 2. Revenue Growth → Trust drives sales: Compare Ethics' AI platform boosted brand revenue up to 1% through verified green claims. → Purpose = market share: Despite logo fatigue (only 4% of Brits trust them), verified sustainability builds buyer confidence. 🛡 3. Risk Reduction → Avoid fines and fallout: Align early with CSRD, ESPR, and rising global disclosure rules. → Resilience strategy: Mitigate supply chain and reputational risk before it escalates. 💡 4. Innovation Driver → Tech unlocks impact: Lufthansa, with SAP & McKinsey, cut costs and carbon by digitising spend and emissions data. → Efficiency gains: AI and automation create faster, smarter pathways to sustainability. 🤝 5. Customer & Talent Retention → Hiring edge: 1 in 10 job seekers prioritises sustainability in job descriptions. → Buyer behavior: 73% of EU consumers say environmental impact influences their purchases. 🌍 6. Capital Access → Investor alignment: 90% of global individual investors (per Morgan Stanley) want sustainability in their portfolios. Bottom line: Sustainability in 2025 isn’t a nice-to-have. It’s a performance driver and your business case needs to reflect that. 🔗 Want the high-res PDF + source links in your DM? ♻️ Reshare this post to help more teams build better business cases. 👤 Follow Abbie Morris

A Practical Guide to 1.5 C Scenarios for Financial Users I'm incredibly proud of this comprehensive UN Environment Programme report and resource on climate scenarios! It was my final piece of work with United Nations Environment Programme Finance Initiative (UNEP FI) and one that was a major team effort and a multiyear process! We developed it to help financial users to understand the assumptions behind these critical scenarios and how they can be applied in financial decision-making from net-zero target-setting to risk management. It is full of analyses of different scenarios in comparison to each other, explorations of sector decarbonization pathways, and practical applications of scenario data and insights. It covers IPCC, NGFS, and International Energy Agency (IEA) scenarios and brings in data from a variety of sectors in order to show the changes needed to deliver a sustainable future. Have a look through it here: https://lnkd.in/d8G5eSae There really is something in here for everyone. We hope it becomes a valuable desk reference for you and your teams! #climate #netzero #decarbonization #climatescenarios #climatescience #IEA #NGFS #UN #IPCC #climatefinance #climaterisk

There’s a difference between raising capital for a biochar project and being investable. Most projects focus on the first, investors focus on the second. I speak with producers every week, and see a consistent pattern: only a small fraction of projects are actually easy for investors to back. Not because capital is missing, but because risk is not yet under control. Here’s what consistently makes the difference. 1️⃣ 𝐂𝐥𝐞𝐚𝐫 𝐚𝐜𝐜𝐞𝐬𝐬 𝐭𝐨 𝐟𝐞𝐞𝐝𝐬𝐭𝐨𝐜𝐤 No investor funds a project built on “we should be able to source biomass.” They expect long-term agreements, traceability, and proof that the feedstock is residual and compliant. Without secured feedstock, there is no secured revenue. 2️⃣ 𝐀 𝐫𝐞𝐚𝐜𝐭𝐨𝐫 𝐭𝐡𝐚𝐭 𝐜𝐚𝐧 𝐛𝐞 𝐜𝐞𝐫𝐭𝐢𝐟𝐢𝐞𝐝 Investors don’t fund “innovative pyrolysis.” They fund stable systems with measurable yields, clean syngas management, and a clear path to certification. No certification → no credits → no investment. 3️⃣ 𝐀 𝐫𝐞𝐚𝐥𝐢𝐬𝐭𝐢𝐜 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐦𝐨𝐝𝐞𝐥 This is where many projects fail. CapEx must match market benchmarks. OpEx must include downtime and maintenance. Yields must be conservative. If the project collapses when assumptions are slightly stressed, it’s not fundable. 4️⃣ 𝐕𝐞𝐫𝐢𝐟𝐢𝐞𝐝 𝐜𝐚𝐫𝐛𝐨𝐧 𝐫𝐞𝐦𝐨𝐯𝐚𝐥𝐬, 𝐧𝐨𝐭 𝐩𝐫𝐨𝐦𝐢𝐬𝐞𝐬 The market has moved. No digital MRV means no credits, and no credits means no financing. dMRV isn't a nice-to-have, it's part of the asset. 5️⃣ 𝐒𝐞𝐫𝐢𝐨𝐮𝐬 𝐨𝐟𝐟𝐭𝐚𝐤𝐞 𝐬𝐢𝐠𝐧𝐚𝐥𝐬 You don’t need signed contracts right away. But investors expect real discussions, letters of intent, and alignment with buyer standards. Someone needs to be ready to buy the tonnes. 6️⃣ 𝐀 𝐛𝐚𝐥𝐚𝐧𝐜𝐞𝐝 𝐭𝐞𝐚𝐦 Strong engineering without compliance expertise is risky. Strong certification plans without operational depth are just as risky. Investors back teams that can execute across engineering, carbon markets, operations, and sales. A biochar project becomes easy to fund when: ✔️ feedstock is secured ✔️ the reactor is certifiable ✔️ dMRV is designed from day one ✔️ financials are realistic ✔️ buyers are engaged ✔️ the team is balanced The good news is that most of these gaps can be fixed before talking to investors. They’re design problems, not pitch deck problems. Crystalchain

Green finance emphasises "additionality" - yet only 2% of corporate and municipal green bond proceeds initiate projects with new green features. The vast majority of green bonds are used to (a) refinance ordinary debt, (b) continue ongoing projects, or (c) initate new projects without new green aspects. As an example of (c), the semiconductor firm ADI promoted its first green bond as underwriting a new headquarters that was LEED Gold certified. But that ADI’s Irish R&D facility had already achieved the same level of LEED certification, so the green aspect of the project was not novel for the issuer. This does not mean that the project wasn't valuable (rolling out existing green technologies is useful), but contradicts the claims of some green bonds which are to develop new technologies. Instead, it highlights the dangers of black-and-white thinking, viewing "green bonds" as a homogenous entity. A green bond that develops new technology is different from one that rolls out existing technology, which in turn is different from one that refinances ordinary debt. Simply calling a bond "green" masks the wide variety of uses to which the proceeds may be put. By Pauline Lam and Jeffrey Wurgler. https://lnkd.in/gHcCxy3N

Did we get climate finance all wrong? Yes, I tell Akshat Rathi on his Bloomberg Green podcast, Zero. The core problem is that we use "climate finance" to describe many fundamentally different objectives: managing physical & transition risks, financing decarbonization, pricing & distributing risk, building resilience, ensuring fiscal stability, etc. These objectives involve different institutions, mandates, incentives & tools. Some protect/maximize financial value; others aim for climate safety & societal protection. For 10+ yrs, we have profoundly conflated these purposes, institutions and tools. When results don’t materialize, we blame accountability to, and precision of, the frameworks - spending more time refining disclosures, metrics, and methodologies, and pushing for more financial regulation. In 2015, Carney famously (correctly) warned that markets would feel climate impacts only when it was too late to self-correct. But the field drew the wrong implication, focusing on the idea that if long-term climate risk were better understood, priced, and disclosed, markets will reallocate capital to reduce that risk. That fundamentally misunderstands how finance works. Information on how climate affects markets helps institutions manage exposure. It does not make non-viable projects viable or substitute for the coordination, market design, and risk-sharing needed to make modern, integrated, decarbonized, energy systems financeable. (https://lnkd.in/enp6hqun) A related consequential confusion: we atomized the imperative of achieving global, atmospheric 'net zero' emissions into entity-level methodologies, as if the sum of individual net-zero targets would achieve systems decarbonization. But entities cannot, on their own, decarbonize their power, transport and industrial value chains, so the result has been increasingly elaborate accounting exercises that often bear little relationship to physical realities: https://lnkd.in/eN65DrGx The irony is that these confusions obscure the good news: decarbonized energy systems are eminently achievable, and often economically compelling, when the right conditions are in place. We are not constrained by capital or technology. Where clean solutions are cheaper, finance is driving deployment. Where investment stalls, it's because of unaddressed offtake risk, policy uncertainty, currency risk, system integration challenges, or missing coordination, NOT because investors don't understand climate risk. This relates to a final inversion: finance can't phase out fossil fuels; only decarbonizing the consuming sectors can. Fossil finance will end when clean alternatives are cheaper, more reliable, and more accessible -- which, as I note, is possible if we're clearheaded about the approach. 🎧 listen to the podcast here: https://lnkd.in/ecRKR4wR (I look forward to a new Zero episode every thursday as I 🚲 to work, so it was an incredible privilege and joy to meet Akshat in London for this convo.)

Forget unicorns; what #ClimateTech founders really dream of is becoming BANKABLE. It may sound boring, but for climate startups, the ability to raise non-dilutive debt is a sign of technological maturity, allowing them to scale and transition from venture to infrastructure investment. Think solar PV or lithium-ion batteries. Oh, and by the way, that's when you also become a unicorn... The journey to technological maturity (TRL 9) can take years. But if you're already at TRL 6, here's what you can do today to pave the way to bankability: 1. Hire experts - Bank-glish is not a language most founders speak, yet if you want money from banks, you need to know what they are looking for. Expand your team early on with people who have these skills (e.g. people with a project finance background). 2. Add a potential customer to your cap table - now is the time to get a strategic involved. This will signal confidence to the banks, as corporates have a better balance sheet than you, and with equity upside benefits, they are more likely to enter into off-take agreements. 3. Secure off-take agreements- yes, stating the obvious. But remember, non-binding LOIs are not the same as take-or-pay agreements. The latter actually secure future revenues and can be pledged. More on that in a future post. 4. Start small - before you ask the bank for €50M, how about taking €500k? You'll be more likely to get it and you'll improve your credit rating and show that you can be trusted. 5. Get to know the local bank manager - don't go straight to "Deutsche Bank", start with the local "Sparkasse". Local and state-owned banks have more KPIs than just financial returns, such as job creation. If you're doing something positive for the community, you're likely to get a (small) loan, even if your technology isn't 100% proven. Remember, it’s a long journey and it’s never too early to start. @Founders - I’m curious to hear your stories. How did you secure loans early-on? #venturecapital #funding #nondilutivecapital

Investment Opportunities in Climate Adaptation and Resilience 🌎 Climate change is intensifying physical risks across regions and sectors, placing climate adaptation and resilience (A&R) at the center of global strategic priorities. While mitigation addresses emissions, A&R solutions tackle the immediate and long-term risks to infrastructure, economies, and communities. Investment in Climate A&R remains at an early stage despite its scale and urgency. The BCG and Temasek report projects global A&R financing needs of $0.5 trillion to $1.3 trillion per year by 2030. This presents a significant opportunity for private capital to drive both financial returns and systemic resilience. The Climate Adaptation & Resilience Investment Opportunities Map provides a framework to assess where capital can be most effectively deployed. It structures opportunities into seven impact themes and offers a granular view of subsectors and solutions across industries. Investors will find diverse entry points—from early-stage ventures focusing on pure-play A&R innovations to established industrial players integrating resilience solutions into broader portfolios. This dual landscape enables a mix of venture, growth, and buyout strategies tailored to different risk appetites. Adaptation markets are inherently localized. Flood defense strategies, water efficiency technologies, and agricultural resilience solutions vary by geography, creating fragmented but scalable market opportunities that respond to specific climate risks and regulatory frameworks. The report highlights the importance of co-benefits. Nature-based solutions, for example, deliver protective functions while enhancing biodiversity and ecological health. At the same time, material-intensive interventions require careful scrutiny to balance resilience gains with environmental impacts. To capitalize on these trends, investors will need to navigate sectors where regulation, insurance incentives, and risk disclosure frameworks are evolving rapidly. Competitive advantages will accrue to those with deep technical expertise and the ability to scale proven solutions across markets. The Climate Adaptation & Resilience Investment Map identifies seven key impact themes: - Food Resilience - Infrastructure Resilience - Health Resilience - Business and Community Resilience - Water Resilience - Energy Resilience - Biodiversity Resilience Climate adaptation is shaping a new investment frontier, where value creation is tied directly to long-term societal and economic stability. #sustainability #sustainable #business #esg #climatechange