Carbon and emissions tech investing could match 2021 peak

Carbon and emissions tech experienced a strong Q3 2022—its third-strongest on record—raising a total of $4.8 billion. Deal value has increased each quarter over the past 12 months, and VC activity is on pace to match 2021 figures.

Our Q3 2022 Carbon & Emissions Tech Report highlights the vertical’s most active players, the technologies they’re most interested in and how startups have boosted efforts to develop more advanced and energy-efficient approaches to carbon removal. Key takeaways include:

• • The US Inflation Reduction Act—which committed $370 billion in grants, tax cuts and loans to tackle climate change—hasn’t yet made its expected impact on VC investing.

• • Median pre-money valuations of early-stage VC companies in the vertical jumped from $9.9 million in 2017 to $35 million in 2022, an increase of 254%.
  • In carbon tech specifically, Q3 recorded the third-highest deal value in the past 24 months.