If you stop driving, recycle everything, stop eating meat, stop flying…well basically stop every action that pollutes — you’ll only reduce about a third of your personal CO2 footprint. The big problem is the big polluters.
Norwegian Meteorological Institute
As individuals, people can contribute a lot to the reduction of greenhouse gases to stop climate change. However, the most significant actions can only be carried out by large companies. These are responsible for most of the release of greenhouse gases into the atmosphere.
Technological initiatives that focus on improving industrial processes can have a more significant impact in slowing down climate change and thus reaching the goals proposed in the Paris agreement. The venture capital increasingly pays more attention to these initiatives.
This sector is called CleanTech and brings together a variety of technologies related to energy, water, agriculture, transport, and manufacturing, intending to reduce the toxicity of the industry.
An example in Latin America is qAIRA, a Peruvian startup run by Mónica Abarca that, with the use of drones, measures the environmental impact of mining and helps the industry identify areas for improvement.
Sunthetics, a company created by chemical engineer Daniela Blanco, is another example. This startup improves the production process of nylon, one of the most polluting industries in the world.
The CleanTech also have meeting points with other sectors, such as AgTech. Agro-industry is also a very polluting sector, both in its production and transport. For that reason, solve with big data and artificial intelligence allow to improve the processes of the field and reduce its impact on the environment.
How could CleanTech be profitable?
The CleanTech allows companies to expand their profit margins by making their processes more efficient and reducing the waste of energy, resources, or fines for environmental damage in addition to reducing the environmental impact.
In 2008, investments in CleanTech reached their highest point, and after this, the sector has plummeted despite the advance of other areas. Part of the loss of interest on the part of the investors in the CleanTech was due to the success of the tech industries that, with less investment and resources, achieved better incomes.
Mark Golden notes that “Cleantech startup founders and employees usually had extensive experience in areas like inventing new materials and devices, but they often utterly lacked experience in manufacturing or operating a business, the researchers find. A similar lack of experience was not necessarily fatal for information technology startups, because they often were creating new markets, whereas clean energy ventures are trying to capture a share of an existing market.”
For John Weyant, Stanford professor of management science and engineering, the CleanTech can be much more productive thanks to the need of the world to obtain cleaner and more efficient energies. Also, many managers of traditional energy companies have begun to support these startups, offering them the experience they need. However, private investment will probably still be small even when some venture capital firms like Y Combinator are taking the risky decision to invest in CleanTech.
Y Combinator launched in October 2018 a request for startups (RFS) working to mitigate climate change with solutions aimed to remove carbon from the atmosphere, like genetically engineered microbes that could boost the ability of these ocean organisms to absorb sunlight and capture carbon dioxide, storing it underwater. Some analysts like James Temple criticized the initiative because it is still too risky.
For Ernestine Fu, “Today’s cleantech industry is like the early days of ocean exploration,” said Fu. “The monarchs sponsored the early expeditions, which were expensive, very risky and potentially highly profitable.”
In this sense, governments play a key role in the development of sustainable technologies.