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Charting a Greener Path - Climate Tech Investments Defy Market Trends

  • Climate tech startups raised $8.1 billion in Q1, defying the overall venture investment slowdown.
  • H2 Green Steel secures $4.5 billion for plant development in Sweden.
  • The focus of Electrification in the Swedish industry attracts billions in investments.

Climate tech startups received $8.1 billion in fundraisings in the first quarter, showing that this industry is resilient despite the overall slowdown in venture equity investments. Though the number of agreements is slightly low, the total value is up nearly 400%.

Looking into the quarter, we see that investors concentrated their attention on materials, including green steel and battery materials and minerals.

Among the achievers were, Climate Capital, Lowercarbon, and SOSV, early-stage startups, that secured the most deals coming in at 94, 70, and 59 respectively.
This was contrary to the percentage increase in deals compared to the previous quarter.

However, the sum of money raised was still the second highest on the books, demonstrating that the climate tech industry continued to do well with great performance.

H2 Green Steel, a Swedish startup, invested in infrastructural asset financing for $4.5 billion for full-scale plant development in northern Sweden.

Besides that, the company was empowered with $215 million of equity investment. Hydrogen is used in their steelmaking process to reduce emissions, and coal is eliminated.

The plant will be commissioned in 2022 to produce 2.5 million metric tons of steel during the period beginning mid-2022-2024 to around the year 2027, where 50% of that volume has already been committed to the first set of customers. 

This confirms the approach of electrification that has been the focus of Swedish companies such as Northvolt and investments coming in in billions of dollars for facilities such as big-scale production.

Edited By Annette George