In recent years we have seen the terms ClimateTech and CleanTech being used more and more often to describe some of the newer startup companies that have been taking the world by storm. But what exactly do these terms mean?
With more and more companies being labeled as either climate tech or clean tech, it is important for us to understand what each of these terms mean, and the differences between them. In this article, we’re going to do just that, and go over what climate tech and cleantech companies actually do.
In addition to that, climate tech and cleantech companies have become increasingly popular among venture capitalist and institutional investors, such as the one profiled here. This is a good indication that these types of companies are likely to do well in the coming years, as they are receiving a lot of funding currently.
If you are interested in learning the difference between the two terms, keep reading to find out what climate tech and cleantech mean. We’re going to go over what climate tech is, what kind of companies can call themselves climate tech companies, then we’re going to go over cleantech and the various cleantech companies.
So without further ado, let’s jump into exactly what climate tech and cleantech companies are.
Climate Tech. As the name implies, these types of technology companies have an emphasis on solving various issues our world faces due to the increasing relevance of climate change. The services or products a climate tech company produces are intended to mitigate the impact of climate change.
The technology itself can be a physical type of technology, such as equipment or machinery – or it can be a digital form, such as Power Ledger’s blockchain designed for energy commodity tracking and trading.
Power Ledger develops software for their customers that will help them track every single kilowatt of energy that they use. This is all done via blockchain, which allows the data to be stored concretely.
Now, for those of you who know a thing or two about blockchains, you may know that the concept of decentralization is not very eco-friendly. Many cryptominers have been known to hurt the climate with their localized rigs to run a decentralized blockchain.
However, Power Ledger runs on the Solana blockchain, which is a faster and more energy efficient form of blockchain. This is mostly due to its centralization over blockchains such as Ethereum or Cardano.
Clean tech, also known as green technology, is a more broad version of climate tech, in that clean technology typically improves sustainability. This differs from climate tech as being sustainable doesn’t necessarily mean reducing the impact of climate change. It just means the technology itself is not adding on to the fire.
Clean tech has been a very popular form of investment over the past couple decades, and has paved the path for many changes in entire industries to become more eco-friendly and sustainable.
So many businesses no longer rely on dirty energy such as coal or natural gas. This is largely thanks to the United Nations Principles for Responsible Investing. The organization had an agreement to commit to 6 rules, which were designed to put sustainability and eco-friendly investments as a number 1 priority for investment funds and other financial institutions.
If you’re looking for some examples of clean tech companies, check out this list:
- Soluna Computing
This startup has set out to stop the tradition of wasting 30% of solar and wind energy. To achieve this, Soluna plans to buy this lost energy up and use it to power crypto mining and machine learning data centers.
Essentially, it will take clean energy that is going to waste, and put it toward development of new technologies.
- Simpliphi Power
This company has designed batteries that are much less detrimental to our environment. These batteries do not contain cobalt, which has been historically tied to child labor in addition to being toxic.
In 2021, Simpliphi Power was bought by Briggs & Stratton, an American Fortune 1000 manufacturing company.
You now have a better understanding of what cleantech and climate tech companies do. If you’d like to do further research on the topic, we recommend checking out this guide from Clean Energy Ventures.