This was supposed to be the year that climate tech died.
President Donald Trump and the Republican Party have done their best to dismantle the Biden administration’s hallmark industrial and climate policies. Even the European Union has begun to ease off its most aggressive goals.
And yet, as the year closes the receipts provide a different view of climate and clean energy investing in the U.S. and Europe. Instead of tanking, venture bets in the sector remained essentially flat relative to 2024, according to CTVC, far from the slide some had expected.
That resiliency is due in part to continued threat of climate change. Perhaps a bigger contributing factor is that many climate technologies have become either cheaper or better than the fossil fuel alternatives — or are on the cusp of being so.
The incredible cost reductions of solar, wind, and batteries continue to fill climate tech’s sails. Not every new technology will follow the same path. But it does provide evidence that fossil fuels aren’t invincible and ample opportunities to fund companies providing cleaner, cheaper replacements do exist.
Data centers continue to dominate
Last year, I predicted that 2025 would be the year that climate tech learned to love AI and its thirst for electricity, one that has largely borne out. It’s not entirely surprising — for the climate tech world, cheap, clean energy is its cornerstone.
Interest in data centers has only increased in the last year. And investors TechCrunch surveyed were nearly unanimous in their agreement that data centers will remain at the center of the conversation in 2026.
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“They are creating their own financial ecosystem, and there is enough actual momentum in current AI efforts that I don’t see the hyperscalers pulling back in 2026,” Tom Chi, founding partner at At One Ventures, told TechCrunch.
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