Climate Tech Is Becoming an Economic Opportunity

Climate tech has had a strange few years.

It went from one of the biggest stories in venture capital to an area that many investors seemed to lose interest in. AI took over the conversation, funding became harder to secure, and the perception around climate tech shifted.

So, for this episode of Nothing Ventured, our founder and CEO, Aarish Shah, sat down with Matthew Blain, climate tech investor at Voyager Ventures, to look at what is actually happening beneath the headlines.

The conversation covered climate tech, energy, batteries, robotics and the economics driving some of the biggest changes in physical technology.

One point came through particularly clearly: “narrative should never replace product market evidence.”

And the evidence is interesting.

Climate tech has to make economic sense

For Blain, the investment case starts with the business.

Voyager looks for companies where the underlying technology can compete economically. That means avoiding businesses built around a permanent green premium or those that rely entirely on government policy to make the numbers work.

The logic is simple. If a product is more expensive than the incumbent, adoption will always have limits.

If it is better, faster or cheaper, the potential market becomes much larger.

Electric vehicles provide a good example. Environmental concerns may influence some purchasing decisions, but economics are increasingly part of the reason people make the switch.

The same principle applies across energy and industrial technology.

A company that can produce energy more cheaply has a compelling proposition regardless of how interested its customers are in climate change.

For investors, that creates a much stronger foundation for growth.

Policy can help, but it cannot carry the business

Government policy can have a huge impact on emerging technologies. It can accelerate adoption, provide grants and influence where companies choose to build.

Voyager’s portfolio companies have raised more than $500 million in non-dilutive grant financing, showing how valuable that support can be.

The risk comes when policy becomes the business model.

Political priorities change. Incentives change. Governments change.

A company operating on a 10 to 15-year venture capital timeline therefore needs economics that can survive those changes.

Policy can provide a tailwind. The underlying business still needs to work without it.

Batteries are moving faster than most people realise

One of the most striking parts of the conversation was the scale of battery deployment.

According to figures discussed on the podcast, global battery deployment grew from around 10 GWh in 2020 to 20 GWh in 2021, more than 200 GWh in 2024 and around 350 GWh the following year.

That is an enormous increase in a very short period of time.

And much of that growth comes down to economics.

Batteries make renewable energy more useful, help balance electricity grids, support electric transport and can reduce energy costs for businesses.

The consumer may only see the end product, whether that is an EV or a home energy system. Behind it sits an increasingly sophisticated network of batteries, manufacturing capacity and energy infrastructure.

That part of the transition receives far less attention than the headline technologies.

Energy is becoming a competitiveness issue

The economics of energy matter particularly strongly in Europe.

High energy costs make it harder for European businesses to compete globally. Producing and storing energy more efficiently therefore has implications far beyond emissions.

Renewables, batteries, nuclear and other energy technologies all have a role to play. The important question is how their economics develop and whether they can provide reliable energy at competitive prices.

For investors, this creates an interesting opportunity.

Climate technology can address a major environmental challenge while also solving a major economic one.

That combination is powerful.

The same thinking applies to robotics

The conversation also moved into robotics, where there is another significant gap between perception and reality.

General-purpose humanoid robots attract huge amounts of attention. The technical challenge, however, is much greater than a compelling demonstration might suggest.

Getting a robot to perform one task reliably is very different from getting it to perform thousands of tasks in unpredictable environments.

That is why use-case-specific robotics can be particularly interesting.

A robot designed to solve one clearly defined problem can potentially reach commercial deployment faster and with less capital than a machine designed to do everything.

For investors, the question becomes practical:

Does it work? Will customers pay for it? Can the economics improve as it scales?

The next challenge is scaling

Many of the technologies required for the energy transition have already made significant progress.

Wind and solar account for more than 90% of new energy generation infrastructure being deployed globally, while battery deployment has grown dramatically over the past few years.

The challenge is increasingly about scaling.

Manufacturing. Infrastructure. Storage. Supply chains. Grid connections.

These areas may not generate the same headlines as a new technological breakthrough, but they could create some of the most important opportunities for investors and founders.

There are still difficult problems to solve, particularly in areas such as cement, concrete and aviation.

But across energy, batteries and transport, the economics are moving quickly.

And that matters.

Technologies become easier to adopt when they offer customers a better economic outcome. Adoption creates scale. Scale can bring costs down further.

For climate tech, that may be the most important development of all.

The transition does not depend on everyone suddenly becoming more environmentally conscious.

It depends on the technology becoming too economically compelling to ignore.

Enjoyed this article?

Subscribe to our newsletter for founder insights, practical advice on fundraising and finance, and the biggest takeaways from our latest podcast episodes, delivered straight to your inbox.