NEWS UK set to double investment into climate tech in 2022, surpassing general UK tech investment growth ech Nation, the UK’s leading growth platform for tech scaleups, has today published its Climate Tech Report 2022, to shed light on the state of UK climate tech ahead of COP27 this month. UK is a world leader in climate tech Tech Nation’s Climate Tech Report 2022 has revealed that international investment into UK climate tech companies has almost doubled, rising from $4mn in 2021 to $7.5bn so far in 2022. While the trend is increasing for the UK and on a global level, this is not the case for all countries. Investment in the US, Germany and Sweden seems to be slowing down; receiving $2.139bn, $4.458bn and $2.173bn less investment in 2022 so far (compared to 2021) respectively. The UK is on track to see climate tech companies raising nearly $20bn per year by 2030. This means that UK climate tech investment is ahead of overall UK tech investment, as despite a strong start to 2022 (with a record first quarter for tech VC investment at $12.1bn), the rest of 2022 has been significantly down on 2021 figures. Q2 2021 saw $11.4bn placed into UK tech overall, Ahead of COP27, Tech Nation today publishes its Climate Tech Report 2022. • Report reveals investment into UK climate tech is growing exponentially and is set to double in 2022, with UK climate companies raising $7.5bn in 2022 so far (up from $4bn in 2021). • Meanwhile, investment in the US, Germany and Sweden is slowing. • The UK is second only to the United States for the number of companies working to address the climate crisis. • However, continued growth of the sector would be threatened by R&D cuts; Tech Nation calls for Government recommitment to R&D spend. • 2022 is set to be another record year for investment into climate tech companies globally. Already at $73.86bn (compared with $111.24bn in 2021), investment is being driven by large rounds (of $185mn+) into later stage companies. T while Q2 2022 was $9.9bn, and Q3 dipped even further in comparison to last year, just $4bn in 2022 compared to $11.9bn in 2021. R&D spending must be protected for continued climate tech innovation The UK’s climate tech ambitions are dependent on policy to fuel continued innovation. Amidst concerns that R&D might be cut, Tech Nation is urging the Government that R&D funding must be protected to help drive us towards net zero, and an innovationled economic recovery. A report from the IPPR suggests the UK lags £62 billion behind in R&D, with investment falling by a fifth since 2014 and with the UK now placing just 11th in the OECD in terms of total R&D investment as a percentage of GDP - well behind countries like Austria, Switzerland and the USA. Climate techcompanies arecrucial todriving down carbon emissions across theworld Tackling the climate crisis has become a top priority for the majority of developed countries across the world. Globally, the quantity of emerging technology companies tackling the climate crisis has increased nearly 4 times by over 35,000 companies since 2010, to reach 44,595 in 2022. The emission reduction potential of technologies represented by the 44,000+ climate tech companies applying 191 different technologies across the world is predicted to surpass 2019 emissions in 2036. It is also predicted to grow to 1.4x further by 2050, equalling 599,000 MMtCO2e per year. This means that by 2036, climate tech companies will be removing more carbon from the atmosphere than the world produced in 2019. The rapid scaling up of these firms is essential to accelerate this progress, as significant change will need to be made before this time. Tech Nation programmes to accelerate UK climate tech Tech Nation is currently running its Net Zero and Net Zero X growth programmes for earlystage and late-stage climate tech companies respectively, and these trends are reflected in the newest company cohorts. Among their latest cohorts are companies who are working on algae engineering (such as Kelpi, Phycobloom and Phycoworks), and half of the companies joining each programme are working to decarbonise the UK’s energy sector (such as Filia, Electric Miles and Equiwatt). Tech Nation’s Net Zero programme has seen its first cohort of companies increase their collective funding by over £150 million since completing the programme (an average increase of £5 million each), while its second cohort has increased their collective funding by over £100 million in the past 6 months. Since joining Net Zero, these early-stage companies have grown so rapidly that over half of them (11 of 20) have been accepted into Tech Nation’s Net Zero X programme for late-stage climate tech businesses.
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