Climate Flash Report

Daily climate technology and sustainability news - Updated: 2025-10-16

Sustainability intelligence that saves the world

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📈 Real-time prices • Updated daily with fresh content • Last updated: 2025-10-16 08:07

Climate Tech Startups & Funding

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All Aboard Climate Tech Fund Launches

A coalition of top VCs—including Khosla Ventures, Breakthrough Energy Ventures, and DCVC—has launched the All Aboard Coalition, aiming to close a $300 million fund by late October 2025 to support climate tech startups facing a funding crunch as U.S. government support wanes[1]. This comes as U.S. direct air capture (DAC) startups raised just $58 million in Q1 2025, down over 60% year-over-year, with several high-profile firms (e.g., Running Tide, Noya) folding due to financial strain[1].

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Global Climate Tech Investment Trends

Early- and growth-stage climate tech investment reached $13.2 billion globally in H1 2025, down 19% from the previous year, reflecting a broader market cooling[2]. Despite this, the sector’s share of total VC funding has risen to 16%, up from 14%, indicating sustained investor interest even as the bar for traction and unit economics rises[2][6].

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Notable Startup Raises

Brineworks, an Amsterdam-based startup, raised $5.87 million in seed funding to scale its saltwater-based CO2 capture and hydrogen production technology, targeting commercial deployment by late 2026[4]. The company’s system is designed to run intermittently on the cheapest renewable electricity, aiming to lower the cost of carbon-neutral aviation and shipping fuels[4].

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Startup Ecosystem

Over 100 startups from 13 countries applied to pitch at Trellis Impact 25, having collectively raised more than $750 million; 25 finalists will compete for “Startup of the Year” at VERGE in late October[2]. Y Combinator and other accelerators continue to back a pipeline of climate tech innovators, with 49 climate startups currently in the YC portfolio[8].

Clean Energy & Environmental Innovation

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Sector Focus Shifts

Investment is cooling in some areas (e.g., DAC, green hydrogen) but remains strong for technologies aligned with the AI/data center boom, such as nuclear, geothermal, and energy storage[2]. Carbon capture is gaining commercial traction, with innovative startups entering the mainstream[2].

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Regional Leaders

The U.S. remains the global leader in climate tech funding, with $147 billion invested since 2018—2.4x more than China[6]. Leading hubs include the Bay Area, Boston, Shanghai, and London, with European cities like Stockholm and Paris also seeing rapid growth[6].

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Corporate & Regulatory Momentum

Nearly every major corporate quarterly report now includes climate targets, and regulators worldwide (U.S. IRA, EU Green Deal, APAC net-zero initiatives) are increasing climate-focused spending, though U.S. policy has become less supportive under the current administration[2][5].

ESG Investing & Impact

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ESG Dominance

Climate tech now attracts 80–90% of all impact investment, far outpacing social impact startups[6]. Serious climate tech VCs are increasingly selective, prioritizing startups with proven unit economics, scalable IP, and regulatory alignment[5].

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Top Investors

Leading climate tech VCs include Ecosystem Integrity Fund (Series A/B, U.S.), Clearvision Ventures (Series A–C, U.S.), and Halogen Ventures (early stage, U.S.)[3]. OpenVC’s updated database (October 2025) provides a comprehensive list of active climate tech investors globally[5].

Climate Policy & Carbon Impact

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U.S. Policy Rollbacks

The Trump administration has rescinded grants and frozen funding programs, creating headwinds for renewable energy and electrification startups[1][2]. Many Inflation Reduction Act incentives have been rolled back, though not all[2].

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