🔮 Seems that we are finally reaching community consensus on what I have been saying for a while... Climatetech 3.0 has arrived.
🔥 You could argue the change happened basically overnight. When the Trump administration came in, the disruption came thick and fast. For many in climate, there was a period of a few months where it felt like every funding opportunity, program, dataset, and active award was disappearing. When the dust settled, there was basically nothing left: there was a massive vacuum of support on the traditional pathway to scaling and deploying research. If your tech didn't have to do with "Defense", AI, Nuclear, or Critical Minerals, you were basically on the outside.
↩️ This was a sharp reversal from the build up over the last decade, starting with massive solar and wind RnD and deployment and ending with excitement around green hydrogen, SAF, and other electrified pathways.
🌍 But really, it's not just Trump. Worldwide, many of these projects are getting axed. Not solar, of course. Solar has continued to show unprecedented deployment, and it's dragging batteries up with it. But worldwide, there has been a huge increase hesitancy and cancellations for most every other climatetech we've been betting on.
🫧 The reason really is simple: there was excitement, and excitement suppressed diligence in favor of believing that, just like solar, the technology would get there if we threw enough money at it and we were patient. But when the music stopped, large companies and institutions were holding the bill for projects that weren't profitable without policy support.
📉 When I say the green premium is dead, this is what I mean. Billions of dollars went to scaling projects that felt good, but couldn't deliver on the economics. And large institutions got burned, and they will remember, and they will change how they build in the next decade. The bar for economic viability not only became the main hurdle for new technologies, it got a lot higher.
🏗️ Really, the green premium is another way of talking about resource allocation. Energy, minerals, time, concrete, capital... there's only so much to go around, and paying extra for something just because it's green won't be so attractive moving forward as notions of scarcity start to become more acute. We must change how, and what, we build.
❓ What does this mean for founders and researchers in climate? You must be ruthless in assessing the viability of the techs you're working on. They must stand on their own merits in an increasingly volatile and resource constrained world. "Feeling good" isn't good enough anymore.
🏆 Who comes out on top? Waste-to-value, profitable decarbonization, retrofits, nature-based solutions, resiliency, efficiency plays, this is your moment!
Anyone else feeling this? It's good that the conversation is starting, and I hope this is our moment to mature as a sector and build with the end in mind, providing value through outcomes versus virtue.
