Climate tech startups are leading the $2.3 trillion energy transition
Clean energy attracted a record $2.3 trillion in investment in 2025 — and that number says a lot about the moment we are living in. Even with the United States pulling back on climate goals during Donald Trump’s second term, the sector pushed forward at full speed. It is a curious paradox: while the political rhetoric cooled down in some regions, money kept flowing into technologies that generate clean energy, strengthen electrical grids, and reduce emissions in heavy transport. In this case, the market spoke louder than any political statement.
And there is a central character in this whole story: artificial intelligence. Global energy demand tied to AI is expected to quadruple over the next ten years, forcing data centers, electrical grids, and the entire energy infrastructure chain to reinvent themselves — fast. 🚀 This means the race for climate tech solutions is no longer an isolated environmental concern. It has become a structural necessity for the digital economy.
This is the landscape where the BloombergNEF Pioneers 2026 comes into play, selecting 12 startups from a pool of 611 candidates that are genuinely moving the needle on the global energy transition. These companies were chosen for tackling three of the biggest challenges in this process: powering data centers with clean, efficient energy, balancing supply and demand on electrical grids, and decarbonizing heavy-duty transport on land and sea. Together, they show that the world increasingly runs on electrons — and that there is a very solid business model behind this transformation.
As Claire Curry, global head of technology, industry, and innovation at BNEF, put it, historically the sector referred to cutting emissions as net-zero emission targets. But as recent conflicts have shown, a large part of the energy transition is now about domestic security and supply for Europe, India, and China.
Why 2025 became a milestone for clean energy
The volume of capital that flowed into the clean energy sector in 2025 was not just a record-breaking number. It represented a mindset shift among investors, governments, and tech companies that for years treated decarbonization as a cost — and today see it as a real growth opportunity. Major S&P clean energy and grid technology indexes also outperformed most other equity indexes over the past 12 months, reinforcing that there are concrete financial returns in this market.
A significant portion of this money came from venture capital funds betting on climate tech startups, but an equally relevant share came from large corporations that need to secure clean energy supply for their operations, especially those tied to cloud computing and artificial intelligence. The war in Iran, in turn, brought the risks of continued dependence on fossil fuels to the center of the debate, potentially accelerating clean tech investments even further.
The pressure on data centers is one of the clearest drivers of this movement. According to BNEF, global data centers are expected to consume up to 1,600 terawatt-hours of electricity by 2035 — roughly five times what the United Kingdom consumed last year. With demand quadrupling over the next decade, the energy bill stops being an operational detail and becomes a strategic survival factor for any tech company.
On top of that, the energy transition gained a new sense of urgency with extreme weather events recorded in recent years. Heat waves, prolonged droughts, and intense storms have started directly affecting the stability of electrical grids across different parts of the world, making the diversification of energy sources not just an environmental goal but a matter of operational resilience. 🌱
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Sustainable data centers: where AI meets energy efficiency
As AI tools become more popular, data center energy demand is growing exponentially. Beyond adding more carbon-free electricity to the global energy mix, finding solutions that help curb the near-insatiable energy hunger of these data centers is absolutely vital. Three of the startups selected by BloombergNEF Pioneers tackle this problem from distinct and complementary angles.
HT Materials Science — Dublin, Ireland
Founded in 2018 with $40 million in funding, HT Materials Science starts from a simple analogy: computing hardware is like the human body — it needs the right temperature to function. Maintaining that ideal temperature consumes up to 30% of a data center’s energy, according to the International Energy Agency. The company developed a chemical additive that increases the heat-transfer capacity of water circulating in cooling systems, allowing data centers to spend less energy cooling their equipment.
Point2 — San Jose, California
Founded in 2017 with $55 million raised, Point2 attacked a bottleneck that few people think about when talking about data center efficiency: copper cables. Data centers rely heavily on copper cables to transmit data, but there are efficiency limits to this transmission — not to mention copper price volatility. Point2 developed an alternative approach that uses radio waves to transmit data through plastic materials. The result, according to the company, is a two-times reduction in energy consumption compared to the active copper cables used in high-speed data transmission.
EmeraldAI — Washington DC
Founded recently in 2024 and already backed by $68 million in funding, EmeraldAI developed AI-optimized software that syncs data center energy consumption with the available capacity on the electrical grid in real time. When the grid is under stress, the system defers computational tasks that do not require an immediate response and redirects urgent ones to another facility where electricity is abundant. This prevents electrical grids from becoming overloaded and also reduces data center reliance on diesel backup generators. ⚡
Flattening the duck curve: the challenge of balancing grid supply and demand
Moving away from fossil fuels means connecting more wind turbines and solar panels to the electrical grid, but greater adoption of renewable energy comes with its own set of problems. One of the main challenges is known as the duck curve — an illustration that shows the mismatch between daily electricity demand and available solar generation throughout the day.
When the sun is shining, solar panels send more electricity to the grid than needed. After the sun sets, the solar contribution drops right when electricity needs increase. In areas with large installed solar capacity, this asymmetry forces utilities to disconnect solar panels at midday and bring other forms of power generation online for nighttime peaks. This hurts the profitability of renewable projects and discourages investors from building more — but for startups tackling load management challenges, it also represents a massive opportunity.
As Claire Curry from BNEF explained, the duck curve is entirely driven by the fact that we still have not figured out an efficient way to match supply and demand with solar energy.
XL Batteries — Marlborough, Massachusetts
Founded in 2019 with $30 million in funding, XL Batteries manufactures organic flow batteries that last up to an impressive 250 hours — compared to the typical four hours of conventional lithium-ion batteries. Its products store energy in liquid electrolytes held in tanks and release electricity by circulating the liquid through a battery stack. Using non-toxic and non-flammable electrolytes, the company says it can install its batteries near or within densely populated areas, avoiding the level of regulatory scrutiny required for similarly sized lithium-ion installations.
Base Power — Austin, Texas
With one of the most impressive raises among the winners — $1.3 billion in funding — Base Power, founded in 2023, builds its business around the idea of turning American homes into virtual power plants. The company leases and installs batteries for homeowners, who can tap into part of the stored energy during outages without a steep upfront cost. In return, Base Power uses software to control when to charge and discharge these batteries, selling electricity back to utilities during high-demand periods. The company has already installed batteries in more than 10,000 homes in Texas and plans to expand to Illinois.
Qvantum — Astorp, Sweden
Originally founded in 1993 and rebranded in 2021 after a merger, Qvantum raised $150 million to solve a specific problem: how to ensure enough electricity to power heat pumps, especially during nighttime peak hours. The solution combines AI-powered software with integrated water tanks that function as thermal batteries. The technology turns on the heat pumps to warm the water tanks when there is sufficient electricity on the grid and releases the stored heat to consumers later. On top of that, the company recycles waste heat generated by industrial facilities — including neighboring data centers — to further reduce the energy needed to heat residential buildings.
Decarbonizing heavy-duty and maritime transport
Clean transport is the largest slice of the climate tech investment pie. The sector received $893 billion in funding last year, according to BNEF. Of that total, $53 billion went to commercial vehicles — a 57% increase over the previous year, outpacing all other sectors in growth rate.
As Angie Farrag-Thibault, vice president of global transportation at the Environmental Defense Fund, noted, it was unimaginable that a market like this could exist just five years ago. Voluntary industry initiatives and a growing number of government policies helped the clean transport sector gain speed rapidly.
In China, nearly 78,000 medium- and heavy-duty electric trucks were sold in the fourth quarter of 2025 alone — although some subsidies have been phased out and growth is expected to slow somewhat this year. At sea, large-scale electric ships are still years, if not decades, away. But low-carbon fuels and other technologies, from drag reduction to wind-assist, are mature enough to be deployed today. Clean maritime transport received $4.2 billion in investment last year.
DeepWay — Hefei, China
Founded in 2020 with $456 million in funding, DeepWay is betting that electric semi-trucks are good — but autonomous versions would be even better. Currently, the company sells Level 2 (L2) automated systems that assist drivers with steering, braking, and acceleration. The company is developing vehicles with L4 technology, similar to Waymo, that will allow trucks to follow the lead of a human-driven truck, with a target of reaching this level of autonomy between 2028 and 2030. 🚛
Silverstream Technologies — London, United Kingdom
Founded in 2010 with $25 million raised, Silverstream Technologies sells systems that generate a layer of microbubbles along a ship’s hull. This reduces drag, cutting fuel consumption and emissions. While the technology does not zero out a ship’s emissions, it has key advantages: older ships can be retrofitted with the system, and it is already being deployed. The company has more than 250 systems on order, with over 150 vessels operating at sea.
WattEV — Long Beach, California
Founded in 2020 with $100 million in funding, WattEV operates as a vertically integrated fleet manager, leasing trucks, hiring drivers, and building charging depots. The company also develops solid-state transformer technology to make charging more efficient. It currently operates six charging locations, with another 12 in development, and plans to have 100 depots in operation by 2035.
Aces up the sleeve: the energy transition wildcards
Not all Pioneers winners fit neatly into traditional categories. This year’s wildcards offer a glimpse of emerging sectors and regions in climate tech — from electric buses in Africa to microbe-assisted copper mining and the elimination of forever chemicals from batteries.
BasiGo — Nairobi, Kenya
Founded in 2021 with $50 million, BasiGo helps drivers switch from diesel to electric buses in Kenya and Rwanda. Despite being only five years old, the startup is already responsible for the majority of electric buses on the roads in both countries and operates the largest DC fast-charging network in Africa. The company builds the buses locally using kits manufactured overseas and leases the vehicles to operators while also managing the charging infrastructure.
Endolith — Denver, Colorado
Copper demand is expected to outstrip supply, resulting in a deficit of 19 million metric tons by 2050, according to BNEF, driven by electrification and the AI boom. Founded in 2023 with over $20 million in funding, Endolith created specialized microbes to extract more copper from ore. The microorganisms are added during acid leaching processes to recover more copper from low-grade ore. The company is already conducting its first field trial in the US and has partnerships with mining giants Rio Tinto and BHP.
GRST — Hong Kong
Founded in 2015 with $80 million, GRST addresses one of the less-discussed sides of batteries: the binders that connect active materials to electrodes rely on PFAS, the so-called forever chemicals, which are associated with serious health concerns. The company developed a technology that eliminates PFAS by creating a water-soluble binder that can be recycled without relying on hazardous chemicals or high temperatures.
The strategic role of artificial intelligence in this equation
AI is not just a voracious energy consumer — it is also one of the most powerful tools available for optimizing how that energy is used. Machine learning models are being applied to forecast solar and wind generation, intelligently manage batteries, detect faults in turbines and panels, and optimize routes for sustainable transport fleets. This duality is fascinating: at the same time AI creates unprecedented energy demand, it provides the tools for that demand to be met more efficiently and with a smaller environmental footprint.
Several of the 12 selected startups incorporate AI as a core component of their products — as with EmeraldAI in data center management and Qvantum in residential thermal management. This convergence of climate tech and artificial intelligence is creating a new category of company, sometimes called climate tech + AI, that attracts both cleantech investors and tech funds that previously only looked at pure software. The result is an even more robust and diversified flow of capital reaching the sector.
Despite the signs of progress, the transition is not happening fast enough. Major tech companies have spent billions of dollars sponsoring clean energy projects, but their emissions keep rising. And countries agreed on a global carbon tax on maritime shipping, only to see it blocked by pressure from the Trump administration. Still, what the BloombergNEF Pioneers 2026 makes clear is that the energy transition is no longer a future project. It is happening now, driven by economic necessity, regulatory pressure, and most importantly, genuine technological innovation.
The 12 selected startups are a snapshot of the most promising players in this space — and the fact that they emerged from a process that evaluated more than 600 candidates says a lot about the level of momentum and competitiveness this market has reached. Clean energy is no longer Plan B. It has definitively become the main plan. 🌍
