In 2023, according to Statista, investments reached a record level of $1.8 trillion. And for the current year, spending on cleantech is expected to be almost twice as high as that devoted to fossil fuels.
Since the beginning of the year, nearly 160 million francs have been raised by Swiss start-ups active in the cleantech sector. Mirroring Swiss dynamism, clean technologies are booming all over the world. This is notably the case in France, where start-ups active in the environmental transition are currently the stars of French Tech.
"Investments in green technologies, essential for the ecological and energy transition, are experiencing continuous growth. The amounts invested and the number of transactions are reaching record levels," says Alexi Gazzo. This partner at EY has for several years been the author of an investment barometer of investments made by French venture capital players in the cleantech sector.
"The amounts invested in green technologies and the number of transactions are reaching record levels." - Alexi Gazzo, partner at EY
Overall, the figures are starting to make heads spin. In 2023, according to Statista, investments increased by 17% to reach a record level of 1.8 trillion dollars. And for the current year, spending on cleantechs is expected to be almost twice as high as that devoted to fossil fuels.
However, it is important not to be hypnotized by the available figures, because this is not the first time spirits have been stirred up about cleantechs. "I am not sure we can yet speak of a new boom for this industry, but rather of the start of a third wave," says Brice Mari.
A portfolio manager at Synapse Invest, he lists two other golden periods for cleantechs, beginning with the one that occurred at the start of the 21st century and was mainly focused on solar. This first interval closed the day the Chinese entered the scene with their rock-bottom priced panels, panels that brought the entire industry to its knees.
"Then there was that period when everyone only talked about sustainable development. Starting around 2015, it reached its peak in 2020, the year of all follies," recalls Brice Mari.
"I am not sure we can yet speak of a new boom for this industry, but rather of the start of a third wave." - Brice Mari, portfolio manager at Synapse Invest
At the start of Covid, supported by the implementation of vast stimulus plans, cleantechs attracted so much interest that a bubble began to inflate rapidly. To prove it, on a purely stock market basis, they were behind the best performances. The Nasdaq Clean Edge Green Energy index, which groups companies in the clean energy sector, ended 2020 with a leap of 204%.
This euphoric phase ended a few months later with the bursting of the bubble and the start of a long hangover for the entire sector. "Already battered, cleantechs paid the price for the rapid rate hikes by central banks. The good news is that this financial pressure helped to clean up the market by eliminating companies with uncertain futures," explains Brice Mari.
At the start of this new wave, two sectors stand out particularly: electrified transport and renewable energy. Data compiled by the experts at Statista show that three quarters of the investments made in 2023 in the energy transition were devoted to companies active in energy and transport.
On a purely geographical level, one must change continents to find the nation most active in the energy transition. With nearly $680 billion invested last year, China stands out once again, far ahead of the United States. But the leading power has not yet said its last word and, thanks to the implementation of policy measures like its Inflation Reduction Act (IRA), it still has the ambition to eventually dominate the market.
"It is estimated that the EU will need more than €90 billion of public and private investments by 2030." - Ian Tiseo of Statista
As for Europe, the Old Continent also intends to play a role in the global race for clean technologies. Its new law on the Net Zero Industry Act (NZIA) was designed with the obvious aim of attracting more investment. "It is estimated that the EU will need more than €90 billion of public and private investments by 2030 to develop the manufacturing of six key technologies under the NZIA," says Ian Tiseo of Statista.
While further phases of overheating should be expected in the decades to come, no one today questions the seriousness and solidity of the long-term movement. Whether in mobility, energy, construction or consumption, the cleantech trend is undeniably promising and a source of positive structural growth.
Naturally, this evolution will depend on politics and the funds invested (public and private). On the political front, the uncertainty around the American elections raises some concerns. The financial aspect is the other fundamental challenge for this capital-hungry industry. To achieve the goal of limiting global warming to 1.5 °C above pre-industrial levels and reaching carbon neutrality by 2050, some experts speak of a doubling of spending by 2030.
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