What Is Climate Tech?

As the climate crisis worsens, both the public and private sectors are looking to climate tech to solve it.

“Climate tech” is a broad term for any technology that can address climate change. It may aim to lower greenhouse gas emissions, remove greenhouse gases from the atmosphere, or lessen the impacts of climate change. From “superhot rock” energy to 3D-printed meat, new technologies are developed all the time that could fight climate change.

Governments around the world have been increasing their support and funding for climate tech. In 2022, the United States passed its largest single climate investment to date — the Inflation Reduction Act. This is likely to be a common policy topic as climate urgency grows.

The Climate Crisis and the Urgency for Climate Tech Solutions

“Greenhouse gases,” such as carbon dioxide, methane, and nitrous oxide, trap the sun’s heat and warm the Earth. When these gases increase in the atmosphere, the planet gets warmer over time. This long-term shifting of temperatures is known as climate change. The Earth’s climate warms and cools naturally, but the past century has brought sudden and rapid global warming.

The scientific consensus is that this climate crisis is primarily caused by human activity in the industrial age. Burning fossil fuels like coal and gasoline adds greenhouse gases to the atmosphere. Deforestation has destroyed many trees, which naturally remove carbon dioxide from the air.

Impacts of climate change include:

• An increase in extreme weather, like severe storms, droughts, flooding, and heat waves
• Rising sea levels due to melting ice sheets and glaciers
• Warming and acidification of oceans
• Disruption of ecosystems, endangering species
• Struggles with agriculture and food production

The United States and most other countries are parties to the Paris Agreement of 2016. The international agreement’s goal is to make sure global average temperatures don’t rise more than 2 degrees C (3.6 degrees F) above pre-industrial levels. Ideally, warming would be limited to 1.5 degrees C (2.7 degrees F). This is a “tipping point” that scientists estimate would cause impacts that cannot be reversed.

To reach either of these goals, the world must work to lower greenhouse gas emissions drastically by 2030. This will be difficult. Action must be quick and impactful. Fortunately, many climate tech solutions have emerged to take on this urgent problem.

Examples of Climate Tech Solutions

Climate tech solutions are being developed in many industries.

Most of the world relies on burning fossil fuels as its largest energy source. Renewable and low-carbon energy sources offer an alternative that can lower emissions. These include hydroelectric, solar, and wind power. New advances in geothermal power could tap into superhot rock energy from deep under the Earth’s surface. In nuclear power, researchers are working on fusion technology that would create less radioactive waste than fission.

Transportation is a fast-growing source of carbon emissions globally. Electric vehicles and alternative fuels can help lower their environmental impact. “Green hydrogen,” or hydrogen produced using electricity from renewable sources, is a new potential fuel for the transportation industry. It also could replace “grey hydrogen” created with fossil fuels, which is used in several industrial processes.

Agriculture and food production are another large source of greenhouse gas emissions. Vertical farming lessens land use and would lower emissions if powered by renewable energy. Alternative protein sources can replace some animal products, which have a large carbon footprint. These include plant-based proteins and new technologies like lab-grown meat. Some companies are using these proteins to 3D print cuts of alternative meat that look and feel like the real thing.

Innovative technologies can remove greenhouse gases from the atmosphere. Carbon capture systems grab carbon dioxide at the point of release. New direct air capture methods can remove it from anywhere.

Even artificial intelligence can help fight climate change. One AI solution optimizes heating and cooling systems so that homes and businesses use less energy. Another new project uses AI to help farmers figure out exactly how much water, fertilizer, and pesticide they need to use. AI also can help make supply chains more efficient, track and trace emissions, and predict climate change impacts.

Government Adoption

Governments play an important role in addressing climate change. Regulation can limit greenhouse gas emissions or the use of materials with a high carbon cost. This kind of lawmaking is not their only tool, though. Governments also can help climate tech move forward.

First, the public sector can direct funding toward vital research areas. It also can offer tax credits to those who develop and build climate tech solutions, helping the private sector invest in these fields.

At some point, private companies may run out of money to test new climate technologies in the field or get them to market. Small startups often get early venture capital funds that dry up before they can grow. Governments can bridge this funding gap by investing in climate tech at the early-to-middle stages when it is needed most. They also can adopt climate tech themselves or give incentives for customers to buy it. This creates demand that can lead to wider adoption of a technology.

The Role of Public-Private Partnerships in Climate Tech

In public-private partnerships, governments work on projects closely with the private sector. A private company may provide the technology and financing needed for a public project. Then the government pays it back through taxes and fees. Montgomery County in Maryland has partnered with a private company on an electric bus system. Cities in other states and countries, like Canada and Chile, also have entered partnerships for electric busing.

Another example of a partnership is a profit-sharing agreement. In this type of agreement, governments and businesses work together to develop a technology and sell it.

Governments and private investors also can partner to fund climate projects. The Netherlands has set up a public-private partnership called the Dutch Fund for Climate and Development. This fund invests in projects to both fight and adapt to climate change in developing countries.

The Inflation Reduction Act and Climate Tech

The Inflation Reduction Act (IRA) is the largest U.S. government legislation to date addressing climate change. Passed in August 2022, it will invest an estimated $369 billion into energy security and climate change.

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