Climate Capital Challenge Technology Definitions

To ensure clarity in participants filling out the Climate Capital Challenge, what follows are a few dozen categories being used for the Capital Climate Challenge and the definitions we’re assuming for them, identified based on market research into the world of venture capital for climate tech (defined as “a broad set of sectors which tackle the challenge of decarbonising the global economy in line with achieving net zero emissions. This can be achieved through low-to-negative carbon approaches to cut key sectoral sources of emissions across energy, built environment, mobility, heavy industry, and food and land use, plus cross-cutting areas such as carbon capture and storage or carbon transparency and accounting”). 

Category: Built Environment

Broadly, buildings include companies advancing technologies that help to monitor and optimize energy usage in commercial and residential buildings. (PitchBook)

• Subcategory: Building energy efficiency
  • Energy efficient building design involves constructing or upgrading buildings that are able to get the most work out of the energy that is supplied to them by taking steps to reduce energy loss such as decreasing the loss of heat through the building envelope. (Energy Education)
• Subcategory: Green building design, construction, and materials
  • A ‘green’ building is a building that, in its design, construction or operation, reduces or eliminates negative impacts, and can create positive impacts, on our climate and natural environment. Green buildings preserve precious natural resources and improve our quality of life. (World Green Building Council)

Category: Alternative Fuels

Alternative fuels are derived from sources other than petroleum. Most are produced domestically, reducing our dependence on imported oil, and some are derived from renewable sources. Often, they produce less pollution than gasoline or diesel. (U.S. Department of Energy)

• Subcategory: Biofuels
  • Biofuel companies are producing an array of fuels generated from renewable biomass. (PitchBook)
• Subcategory: Hydrogen
  • Green hydrogen refers to the production of hydrogen as a fuel through renewable means. The majority of hydrogen today is produced from fossil fuels, largely for cost and energy efficiency reasons. Companies in this space are developing technologies to bring down the costs of producing hydrogen at scale in a carbon-neutral manner. (PitchBook)

Category: Digital Technologies

Utilities trying to reinvent themselves as digital enterprises have found it hard to scale up from digital pilots. Adopting digital ways of working, adding talent, and modernizing IT will hasten transformation. (McKinsey)

• Subcategory: IoT & associated data collection / analysis
  • From the device to the data center, these solutions will include capabilities that support a wide range of vertical markets, like industrial control and energy where devices operate in domains with extreme temperature and safety requirements. For energy companies, this means greater flexibility to accommodate new energy sources, better management of assets and operations, greater reliability, enhanced security, better customer service, and enablement of new business models and services. (Intel)
• Subcategory: Smart grid / smart meters
  • Smart grid refers to technology that allows for two-way communication between power utilities and their customers, enabling a more efficient transmission of electricity. (PitchBook)

Category: Grid

Utility companies that implement an effective grid modernization program can achieve significant cost savings, ease the process of regulatory approval, and secure greater buy-in from their stakeholders. Utility companies are under increasing pressure to implement the technologies and solutions that will make their grid fit for the future. (BCG)

• Subcategory: Efficient transmission
  • In order to make optimal use of T&D systems, losses must be reduced and lines utilized as efficiently as possible. This is not currently the case, particularly on the transmission side. Reducing transmission losses is important not just for the cost of the losses but also for increasing available transmission capacity. (The National Academies Press)
• Subcategory: HVDC technology
  • Today, most power grids use high-voltage alternating current (HVAC) for transporting energy over long distances, but that technology is susceptible to losses during transmission, has limits on power transfer over long distances, and has limited power control capability. A high-voltage direct current (HVDC) system converts the power from alternating current (AC) to direct current (DC) at the sending end, transmits the power using DC, converts the power back from DC to AC at the receiving end, and delivers the power to the receiving end AC grid. Application of HVDC technology is expanding not only for large bulk power transfer over long distances, but also in the interconnection of renewable energy sources. (Burns & McDonnell)
• Subcategory: Peak load management technologies & programs
  • Peak Load Management is a layered system of smart grid monitoring and service alerts that informs you when the grid is at peak demand. That leads to energy management opportunities to scale back on consumption of energy resources in ways that support a smarter energy eco-system with less unnecessary production, a healthier environment, and lower electricity prices. (NRG)

Category: Advanced Generation Technologies

• Subcategory: Nuclear
  • An “advanced nuclear reactor” is defined as “a nuclear fission reactor with significant improvements over the most recent generation of nuclear fission reactors” or a reactor using nuclear fusion. (Congressional Research Service)
• Subcategory: Solar
  • These investments advance research and development in photovoltaics (PV), concentrating solar-thermal power (CSP), soft costs reduction, innovations in manufacturing, and systems integration. (U.S. Department of Energy)
• Subcategory: Wave / water
  • Water technologies encompass a variety of systems that use ocean or freshwater for electricity or thermal energy. The most familiar water technology is hydropower, in which the force of moving water propels a turbine, which in turn runs a generator to create electricity. (Environmental and Energy Study Institute)
• Subcategory: Wind
  • To ensure future industry growth, wind industry technology must continue to evolve, building on earlier successes to further improve reliability, increase capacity factors, and reduce costs. (U.S. Department of Energy)

Category: Energy Storage 

Subcategory: Long-duration energy storage technologies

• Long-duration energy storage technologies aim to improve the ability to store energy from the grid for use on demand, especially as the energy industry expands into renewables. Approaches in this category include flow batteries, compressed air, gravity storage and thermal techniques. (PitchBook)

Subcategory: Next-generation battery technology

• Next-generation battery technology refers to the development of improvements or alternatives to the lithium-ion battery. These improvements and alternatives often involve new materials using advances in chemistry and materials sciences. Improved battery life is expected to enable advances in electric vehicle range, the performance and convenience of consumer electronics and better storage options for renewable energy. (PitchBook)

Category: Transportation

Subcategory: Micro-mobility

• Micro-mobility encompasses transportation solutions that target the “last mile” problem, where users have difficulty traveling from their current location to a major transportation hub like bus or railway stations, or vice versa. Distances covered by these solutions typically average less than six miles, with bicycles and scooters being the most prevalent form of transportation used to for these trips. (PitchBook)

Subcategory: Electric flight

• Electric flight companies are developing hybrid or all-electric powertrains for electrified aerial transportation. Due to the lower energy density of existing lithium-ion battery technology, startups in electric flight are constrained to short-to-medium distance applications. Despite this limitation, electric flight is viewed as an important research area to help decarbonize overall air transportation, with primary applications in logistics and passenger transportation. (PitchBook)

Subcategory: EV charging infrastructure

• Electric vehicle charging stations include companies building electric vehicle charging infrastructure to support the electrification of the mobility sector. The number of charging outlets has significantly expanded as awareness and adoption of electric vehicles has increased, and this trend is expected to continue and accelerate as large automakers including GM continue to make investments into electric vehicle development. (PitchBook)

Subcategory: Battery development

• Recent rapid improvements in lithium-ion (Li-ion) battery costs and performance, coupled with growing demand for electric vehicles (EVs) and increased renewable energy generation, have unleashed massive investments in the advanced battery technology ecosystem. These investments will push both Li-ion and new battery technologies across competitive thresholds for new applications more quickly than anticipated. This, in turn, will reduce the costs of decarbonization in key sectors and speed the global energy transition beyond the expectations of mainstream global energy models. (Rocky Mountain Institute)

Category: Industry

Subcategory: Carbon capture

• Carbon capture startups are using a diverse array of technologies to capture, store and/or remove carbon from industrial processes and the environment more broadly. Carbon capture and removal refers to the process of actively capturing carbon atoms and removing them from the atmosphere via storage or utilization in other forms. Carbon capture and removal is one of a series of technologies that investors are pursuing in order to mitigate the effects of climate change. Technologies in this category include afforestation, biochar, carbon sequestration and direct air capture. (PitchBook)

Subcategory: Industrial decarbonization processes

• Industrial decarbonization processes include companies developing techniques, methods, and technologies that enable fewer carbon emissions from common industrial outputs like steel, concrete, and chemical production. Companies in this space are developing industrial process improvements that produce similar outputs with far fewer or no carbon emissions. Industrial processes are big carbon emitters but adapting to new processes is expensive. (PitchBook)

Category: Circular Economy

The Circular Economy concept recognises the importance of a sustainable economic system and aims to minimise waste by considering the full life-cycle of materials, and redesigning products and operations to encourage greater re-use and recycling. (Blackrock)

• Subcategory: Sustainable materials
  • Sustainable Materials Management is an approach to serving human needs by using/reusing resources most productively and sustainably throughout their life cycles, from the point of resource extraction through material disposal. This approach seeks to minimize the amount of materials involved and all the associated environmental impacts, as well as account for economic efficiency and social considerations. (U.S. Environmental Protection Agency)
• Subcategory: Waste management & recycling technologies
  • Waste management practices help to define the end of life for plastics, as well as helping to prevent waste altogether. Meeting minimum standards for waste management, and moving away from landfilling and incineration towards waste prevention, re-use and recycling should be primary objectives for investors. (OECD)

Category: Climate Resilience

Strengthening the capacity of a system to withstand climate-related shocks or stressors (defined as climate resilience) is where adaptation and resilience intersect. Climate resilience constitutes an important and growing subset of building system-level resilience to multiple shocks. (World Bank Group)

• Subcategory: Resilient Infrastructure
  • Ensuring that infrastructure is climate resilient will help to reduce direct losses and reduce the indirect costs of disruption. New infrastructure assets should be prioritised, planned, designed, built and operated to account for the climate changes that may occur over their lifetimes. (OECD)
• Subcategory: Climate risk analytics
  • By demystifying the risks of climate change, we are committed to helping organizations of every type factor these consideration into their strategic outlook with Climate Change Models, data, and analytics. (RMS)

Category: Agriculture, Forestry, and Other Land Uses

Land provides the principal basis for human livelihoods and well-being including the supply of food, freshwater and multiple other ecosystem services, as well as biodiversity. Human use directly affects more than 70% (likely 69-76%) of the global, ice-free land surface (high confidence). Land also plays an important role in the climate system. (IPCC)

• Subcategory: Reforestation / deforestation
  • Reforestation startups in this space are focused on developing technologies and providing services related to reforestation and forestry management. The acceleration of both climate change and biodiversity loss has propelled governments and private actors to respond quickly—in this case by restoring and maintaining trees across the world in areas where they once thrived, enabling more species to flourish and carbon to be captured at greater rates. Types of companies in this space include drone-based replanting, satellite and AI-supplemented imaging and carbon offset programs. (PitchBook)
• Subcategory: Advanced agricultural practices
  • Climate-smart agriculture (CSA) is an integrated approach to managing landscapes—cropland, livestock, forests and fisheries–that address the interlinked challenges of food security and climate change. (The World Bank)
• Subcategory: Low carbon food & diet technology
  • A low carbon diet means making lifestyle choices to reduce greenhouse gases. Such a diet minimizes emissions released from the production, packaging, processing, transport, preparation and waste of food. (EcoWatch)