Jordy here.

From now on, twice a month, we’re going to send you the climate news that’s actually good.

Here’s where this came from. Skander hated posting on LinkedIn. Then he started sharing what’s going right in climate, watched mini essay after mini essay take off, and went from roughly zero posts a year to over 2 million views a month.

Turns out people are starving for climate hopecore.

The problem: the algorithm decides who sees what, and you never know what you’re going to get.
Great posts about genuinely important developments vanish before anyone reads them.

So, this roundup. Every two weeks:

👉 The 3 posts that blew up
👉 The one that deserved to and didn't

Subscribe to Climate Drift and never miss a roundup

Subscribe now

🌊 Without further ado, let’s jump right in!

Climate Hopecore - Round #1

Here’s what blew up 💥

i) Sweden built the largest transformer. China will built the next seven.

Europe built the most advanced transformer on earth, and the contract includes teaching China to build the next seven. Come for the 820 tons transformer, stay for the comment section arguing about whether we just sold the factory with it.

Read the essay here

ii) Does the math work out for EV + solar panels

Roughly 3 kW of fold-out panels, 15 kWh a day in a sunny spot, 75-100 km of range while the car sits in a parking lot doing nothing. Come for the arithmetic, stay for the engineers in the comments arguing about dust, wind load and whether the shade is the real product.

Dive deeper here

iii) Look who’s going electric

Every Lidl store in the Netherlands, restocked by electric truck from 2027, three years early. The reason is the least romantic one available: diesel is a volatile cost and rooftop electrons are a fixed one. When the cheapest supermarket in the country decides electric trucks keep it the cheapest supermarket in the country, the argument is over.

Read more now

What the world missed 🙈

The 765 km cable that answers the oldest objection to renewables.

Viking Link runs along the seabed between the UK and Denmark, the longest subsea power link on earth, and it's one node on a map that quietly dismantles "the wind doesn't always blow." It doesn't have to blow everywhere at once. Connect enough of Europe and geography becomes the storage.

Read more

Other hopeful stuff we’ve been working on 👀

The Grid - Stranger than fiction

We listened to the full Stepchange Show episode on the US electricity grid so you didn’t have to.

OK fine, you should still listen to it. It’s incredible.

👉 Listen to the full episode here

But if you want the cocktail party version, the investor dinner version, or just the “blow your colleague’s mind on Slack” version, here are 100 facts that stuck with us.

Anyway, this is it for today.

It has helped a lot of people get their bearings while they work out where they fit in the climate sector. It has also helped entrepreneurs and investors find their next opportunities.

Until now it’s only ever existed as a static PDF, though we know of many people who printed it, there’s only so much you can do with it. You can read it, but you can’t follow a thread through it or pull out the parts that matter to you. Most importantly, you can’t easily find the knowledge, information, and people you are looking for.

We built the Climate Solutions Explorer to change that. It’s the same map (but a bit bigger), now interactive, so you can move through it, search it, and contribute your own entries.

Try it out now

The Explorer is now live at climatesolutionsmap.earth.

You can suggest/submit an entry or your own profile through the submission form, and the whole thing is open source if you want to see how it works or build on it.

Before we jump into the details let’s first answer:
Who built this?

Glad you asked!

Alon Philosof is a scientist who studied, for a decade and a half, marine microscopic life that shapes global carbon and methane cycles through photosynthesis and methane consumption. He received his PhD from the Technion and did his postdoctoral work at Caltech. His work combined extensive field work with computational genomics to trace how carbon moves through microbial systems, building new analytic tools and distilling terabytes of sequencing data to discover novel microbial groups.

He is now building Ecosphere to develop molecular tools to measure and verify carbon removal in the ocean, the “blue carbon” held in coastal and marine ecosystems. These tools provide integrity and risk scores to these projects, a way to gain credibility by showing how much carbon they’re actually removing and how resilient they are.

Alongside building Ecosphere, he is glad to hear from anyone working to make carbon removal more credible, and he is open to advisory or leadership roles where a scientist who likes to build and distill complex, multi-faceted data into a clear signal can be useful.

Now back to what the map can do now:

Every entry is reviewed

Everything in the Explorer is looked at and reviewed by a person before it shows up. Entries come from Drifties (at first) and get reviewed by other Drifties, so the articles, company profiles, opinion pieces, deep dives, and podcasts you find have all passed through someone who knows the field. That matters more now than it would have a few years ago.

Climate content is drowning in AI slop, and interchangeable “consultancy reports,” and this is meant to be the other thing, a deliberate, human-curated map you can trust, one that gets better every time a Driftie adds something worth keeping.

Exploring and searching

There are two ways to get around, and you’ll probably use both. If you want to explore, there are four views of the same data, and you can switch between them freely. Sunburst gives you the whole landscape at once, Bubbles lets you drop into a cluster and its sub-groups, Mosaic shows which areas are large and which are still thin, and Branches follow a single path down the hierarchy. Different views suit different questions, so it’s worth trying a few.

You’ll also notice that some entries appear in more than one place on the map, under different categories. We made that redundancy deliberate, since some solutions (and people) span more than one sector. Big problems need interdisciplinary solutions, and we hope the map makes them easier to find. As the map and dataset grow, we’ll make it even easier to find the people who can connect a solution in one sector with problems it could solve in another.

if you already know what you’re after, search handles the rest. You can look something up by keyword and narrow it by type, tag, author, location, or date, save what you find into a shortlist, and export any slice of it as data or an image. You can also download the data tables to explore them manually, if you’re a spreadsheet kind of person.

It already does a fair amount of what people have been asking for. Open any part of the map and you’ll see what’s actually there, the research and articles, company profiles, opinion pieces, deep dives, podcasts, and the people working on it. Someone weighing where in climate to focus can move through it sector by sector and see what each area holds (and what are the gaps). Someone prepping for a pitch or a new role finds the reading filed right under it. And if you’re trying to find who works on a given solution, whether in a particular place or at a particular company, that’s what the people layer is for, still small but growing.

Building on the data

The map is only the first thing you can do with this data. All of it is open, the data under a Creative Commons license and the code on GitHub under MIT.. Pull the whole dataset, or just the subset you’ve filtered down to, and use it to make your own tools, your own visualizations, or a focused dataset for a question we haven’t gotten to yet. We built one way of looking at this space. The whole thing is set up so you can build on it.

Contributing

Contributing is also how you get your own work in front of people. Along with articles and company profiles, you can submit your own profile as an entry, and it sits on the map inside the part of the climate space you work in, so you show up as part of the solution itself. That was a deliberate choice, and it’s the point of the people layer. Anyone exploring that area finds the people working there and can reach them directly.

Right now that layer is empty, since we’re not adding any personal profiles without consent. This means that if your work is on the map already, you can be among the first to be found there. So, do two things. Put your own profile on the map, so anyone looking into your corner of climate can find you and reach you.

Submit the articles, companies, podcasts, and deep dives you think belong here, the things you’d want another Driftie, employer, collaborator, or investor to find. It only takes a few minutes through the form, and while the map is still filling up, what you add shapes what everyone else sees.

• Explore: climatesolutionsmap.earth

• Add an entry or your own profile: submission form

• The code: github.com/aphilosof/climate-solutions-explorer (open source, MIT + CC BY 4.0)

Subscribe now

Hey there! 👋
Skander here.

$34.5 billion across 152 deals. June closed the first half of 2026, and for the first time this year the largest transaction of the month wasn’t a venture round. It was a syndicated bank loan.

Jarek’s latest Follow the Money breaks down where the capital actually went, and the regional splits tell you more than any macro forecast could.

🇺🇸 North America: $14.4B across 33 deals, the dollar leader and the sharpest thematic concentration of the month. The Darden project in California’s Central Valley took $4.95B of construction debt for 1.15 GWac solar plus 4.6 GWh storage. Helion raised $465M at ~$15.5B against a Microsoft offtake, Thea closed $100M for its stellarator, Endurance pulled $54M for seafloor geothermal. Then Washington committed up to $17.5B in DOE loans for long-lead components across 10 AP1000 reactors (not counted in the month total).

🇪🇺 Europe: $8.6B across 37 deals, split between very large public packages and the deepest mid-stage deep tech layer anywhere. Stegra closed $1.6B on hydrogen-DRI green steel, a Wallenberg-led equity consortium stacked over a fully approving lender group. The Commission put $1.73B of interest-free ETS-funded loans behind European battery cell manufacturing. ICEYE took $520M past a €10B valuation on all-weather flood radar.

🌏 Asia: $3.3B across 39 deals, the deal-count leader with the smallest average cheque. India ran the renewables long tail, with Avaada closing $950M across three utility-scale projects including a firm-and-dispatchable one in Bikaner. China opened a fusion cluster nobody had on the board: four rounds in a single month, one of them CATL’s first fusion bet.

🌍 Rest of World: $8.1B across 43 deals. Australia alone was $4.6B, almost all federal. Tender 8 of the Capacity Investment Scheme underwrote 15 grid-scale batteries totalling 4,205 MW and 16,074 MWh, the largest storage procurement in the tracker to date. Spiro raised $270M for electric two-wheelers and battery swapping across seven African markets. Ecobank issued the first ICMA-designated Nature Bond from a commercial bank at $450M, 3.9x oversubscribed.

A few patterns worth flagging: public markets reopened for climate after a long IPO drought, with ERock listing on the NYSE at ~$600M and Lime pricing at $167M on Nasdaq, though Deep Fission raised $40M against a $150M target and priced 33% below plan. Open, but picky. Project finance ($10.8B) and government programmes ($6.3B) drove more than half the month while venture supplied just $2.5B, a barbell with a thinning middle. And Western Europe recorded its hottest June ever while adaptation took $825M, 2.4% of the total.

🌊 Jarek breaks it all down below, region by region, theme by theme.

But first: Who is Jarek?

Jarek Dmowski is a global transformation leader who partners with high-growth companies with positive climate impact. He combines industry and climate finance expertise with a strong track record of driving growth—across PE/VC-backed scaleups, ABN AMRO, and BCG.

He scaled a data-driven technology company ~2.5x to ~$25M in revenue and led post-merger integrations that enabled ~6x accelerated growth. At a global financial institution, he spearheaded a $2B capital reallocation toward new energy and mobility. He also developed a comprehensive climate plan that translated the Paris Agreement into actionable targets across sectors and established a $250M program to drive efficiency gains and reduce emissions at an energy utility.

Jarek is passionate about how the climate transition reshapes economies and business models, creating significant opportunities for multi-country growth and impact.

Follow the Money - June 2026

by Jarek Dmowski

Welcome to the next edition of “Follow the Money” - a monthly briefing on the capital flows shaping the climate transition.

$34.5B in June. America’s $4.95B solar giant. Australia’s $3.9B battery sweep. Climate markets reopen for public investors. And a $17.5B U.S. nuclear commitment.

June closed the first half of 2026 with $34.5 billion across 152 identified climate-related transactions.

The largest transaction of the month was not a venture round, but infrastructure finance: Darden - a 1.15 GWac solar project paired with 4.6 GWh of battery storage in California’s Central Valley - secured a $4.95 billion syndicated bank loan. Australia provided another signal. The federal Capacity Investment Scheme Tender 8 awarded revenue-underwriting support to 15 grid-scale battery projects totalling 4,205 MW / 16,074 MWh - representing roughly $3.9 billion of supported investment and the largest storage procurement captured in the tracker to date.

But June also reinforced another 2026 theme: the U.S. Department of Energy announced up to $17.5 billion in conditional loan commitments to support the development of 10 large nuclear reactors, underlining Washington’s renewed push to expand domestic nuclear capacity.

June also delivered something we had not seen in previous months: public markets reopening for climate. After a prolonged drought for clean-tech IPOs, investors began returning to climate infrastructure. ERock (Enchanted Rock) listed on the NYSE (~$600M), Lime priced its Nasdaq debut (~$167M) and Standard Nuclear filed for a $383M NYSE listing - though Deep Fission’s undersubscribed raise showed the reopening is still careful.

The timing could not be more urgent. Western Europe experienced its hottest June on record, with extreme heat contributing to excess mortality across the continent while wildfires spread across Iberia and southern France. Physical climate impacts are no longer distant scenarios - they are accelerating the need for resilient energy systems, water infrastructure, food security solutions and adaptation finance.

Let’s dive deeper.

Where did money flow in June 2026?

Explanation of the approach and source data: The investment list was developed based on disclosures, newsletter monitoring and review of climate news. Although not exhaustive, 152 climate-related investment deals were tracked - amounting to roughly $35 billion (all data in US$), covering all continents and different life stages of companies and development finance programs. Data skew toward early-stage companies and investments, as well as development financing programs. We are continuously working to expand the data sources and coverage of investments.

So, where did the money flow in June 2026?

• North America led the month with ~$14.4B across 33 deals, followed by Europe (~$8.6B, 37 deals) and Australia (~$4.6B, 8 deals) - the latter swollen by the federal battery tender. Asia (~$3.3B, 39 deals) led on deal count, with Africa (~$2.1B, 25 deals), Latin America & Caribbean (~$1.1B, 9 deals). Unlike May, one region - North America - clearly dominated.

• Energy once again dominated, accounting for ~$23.0B across 73 deals - by far the largest category, month after month. Industrial was a clear #2 (~$6.1B, 20 deals), lifted by the EU Battery Booster, Stegra and Hybar, followed by Transport (~$2.0B), Buildings (~$1.2B), Adaptation & Resilience (~$0.8B), AFOLU (~$0.7B) and Climate Data (~$0.6B). Buildings and adaptation remained structurally undercapitalized.

• The public markets reopened. After a prolonged clean-tech IPO drought, June saw ERock (Enchanted Rock) (~$600M, NYSE), Lime (~$167M, Nasdaq) and Standard Nuclear (~$383M, filed) reopen the exit window, alongside China’s Zhongke Fuhai (中科富海) (~$139M pre-IPO). The reception was selective - Deep Fission priced below plan and undersubscribed.

• Public and development finance anchored the market at scale. Multilateral institutions and government programmes again supported well over $10B - from Australia’s $3.9B battery tender and the EU’s $1.73B battery facility to the UK’s low-carbon-fuels fund, Morocco’s $400M World Bank risk-finance programme and a wide range of MDB/DFI infrastructure, adaptation and on-lending facilities across Africa, Asia and Latin America. Project finance ($10.8B) and government programmes ($6.3B) together drove over 52% of the month; venture capital was just ~$2.5B.

Let’s now dive deeper into 2026 watchlist themes (please refer to our December perspective for more details) and across regions to highlight technologies with real scaling potential over the next 3-5 years.

Which (of our 2026) themes were most strongly visible in June?

U.S: Nuclear and Geothermal vs. RoW: Solar and Wind

In North America, capital concentrated in dispatchable, capital-heavy power for the AI build-out. Fusion led: Helion Energy raised a $465M Series G at a ~$15.5B valuation (Thrive Capital), against a contract to deliver 50 MW to Microsoft by 2028, while Thea Energy closed a $100M Series B for its planar-coil stellarator. On geothermal, Endurance Energy raised $54M (Founders Fund) for subsea baseload. The policy signal was even larger: the DOE’s $17.5B American Nuclear Supply Chain Loans will finance long-lead components for 10 AP1000 reactors (note: this amount is not included in the month total). The rest of the world kept focusing on the cheapest electrons - India’s Avaada Group (3 projects: Bikaner FDRE, Rajasthan, Gujarat) ($950M firm-and-dispatchable solar), Australia’s $3.9B battery tender, and utility-scale solar-plus-storage across every emerging market. Interestingly, June highlighted also strong investments in solar and batteries in the US, incl. Darden Project. One amendment: China has now entered the frontier, with four June fusion/SMR rounds (Xinghe Fusion / Star Nucleus Fusion (星核聚变), Beta Fusion - CATL’s first fusion bet - Juhe Fusion, Weilan Zhidian / Blue Fulcrum.

“Solarpunk” Continues

The “cheap batteries + localized electrification” thesis kept widening across road, rooftop and street. Solar, wind, battery and storage deals were ~$21.9B (64% of the month). The household and mobility layer stood out: NSW’s Home Energy Saver Program (NSW) ($368M) financed residential solar, batteries and heat pumps; SolarSquare ($53M) has served ~50,000 Indian homes; Solar Landscape ($125M) turns U.S. warehouse roofs into community solar; Spiro ($270M) is scaling e-motorbikes and battery swapping across seven African markets; and Lime ($167M) took shared e-bikes public.

Mid-stage, CapEx-intensive cleantech faces the “Valley of Death”

June produced the year’s best counterexample and its clearest confirmation at once. Stegra’s $1.6B close - a Wallenberg-led equity consortium stacked over a fully approving lender group - shows first-of-a-kind heavy industry gets financed when the capital stack is engineered, not stretched. Hybar ($1.1B debt+equity) and Hygenco Green Energies ($105M across five blended tranches) echo the pattern. Yet the valley is real: Deep Fission raised only $40M against a $150M target and priced 33% below plan. Venture capital supplied just $2.5B against $11.8B of project finance - a barbell with a thinning middle.

Europe

Europe recorded ~$8.6B across 37 deals - blending very large public-finance and industrial packages with one of the deepest mid-stage deep-tech layers in the world: green steel, battery manufacturing, SAR intelligence, AI-for-materials, fusion and nature finance. Two structural anchors set the tone - the EU Battery Booster Facility and Stegra’s green-steel close - reinforcing the pattern of European public finance underwriting deployment while private capital concentrates on first-of-a-kind technology.

Selected June financings:

• EU Battery Booster Facility (Multi-region) - $1.73B European Commission facility providing interest-free Innovation Fund loans (from EU ETS revenues) to scale EV battery-cell manufacturing in Europe.

• Stegra (Sweden) - $1.60B green-steel financing close (June 24; Wallenberg-led equity over an approving lender group); 740 MW hydrogen-DRI plant at Boden - the largest single climate equity raise of the month.

• Matrix Renewables (Spain) - $970M Blackstone-backed IPP; solar-plus-storage project finance with tax equity (859 MWdc / 167 MWh).

• CBRE Investment Management - green bond (Netherlands) - $580M green real-estate bond financing lower-carbon commercial buildings.

• ICEYE (Finland) - $520M primary growth round (General Atlantic lead) taking the synthetic-aperture-radar operator past a €10B valuation; all-weather flood/disaster monitoring under parametric climate insurance.

• Turkiye distributed renewables programme (TKYB & TSKB) (Turkey) - $468M World Bank (IBRD) loan for distributed solar, wind and storage.

• CuspAI (UK) - $400M generative-AI + molecular simulation for carbon-capture, PFAS and clean-energy materials (Bezos Expeditions, Kleiner Perkins) - reported term-sheet-signed, not yet closed.

• PhysicsX (UK) - $300M “Large Physics Models” replacing engineering simulation across aerospace, defence and energy (Temasek lead).

• Low Carbon Fuels Fund (UK Department for Transport) (UK) - $293M UK government programme for sustainable aviation fuel and low-carbon fuels.

• Zenobe Energy (UK) - $275.7M finances and operates batteries and EV-fleet infrastructure for zero-emission transport.

• Ardian - Averrhoa Nature-Based Solutions (France) - $114M €100M nature-based-solutions fund for ecosystem restoration and carbon sequestration (anchored by Société Générale).

• InnovaFeed (France) - $58M black-soldier-fly protein and oil for aquaculture and pet food, scaling its Nesle flagship (Creadev, ADM, QIA).

• Isometric (UK) - $40M carbon-removal certification, registry and MRV platform expanding into industrial certification (Lowercarbon, Plural).

• Astral Systems (UK) - $30M compact multi-state fusion devices targeting medical radioisotopes first, power later (Mercia lead).

• Fuse Energy (UK) - $29M vertically integrated renewable generation-and-retail platform (Series B extension).

• Resand (Finland) - $29M “Sand as a Service” foundry-sand regeneration cutting virgin-sand use and landfill.

• Superlight (UK) - $21M aerospace-inspired lightweight electric middle-mile trucks (2150, Engine Ventures).

• VARM (Germany) - $20M single-family home insulation and energy-retrofit platform (ABN AMRO Sustainable Impact, GET Fund).

• GALVANY (Germany) - $12M integrated smart heating systems for residential and commercial buildings (AENU, SET Ventures).

• Seqana (Germany) - $3.7M satellite + ML measurement of soil organic carbon for carbon projects.

• Acodyne (Denmark) - $2.9M unmanned cargo aircraft for offshore logistics and defence resupply.

North America

North America recorded ~$14.4B across 33 deals - the dollar leader and the sharpest thematic concentration of the month. The defining narrative is now unmistakable: the U.S. is buying firm, dispatchable power and the infrastructure to feed AI - solar-plus-storage at utility scale, fusion, geothermal, nuclear fuel and grid/critical-materials - and, for the first time this year, taking climate companies public.

Selected June highlights:

• Darden Solar and Storage Project (IPX Power) (USA) - $4.95B construction-debt package for 1.15 GWac solar + 4.6 GWh storage in California’s Central Valley (IPX Power, an Intersect Power spin-out); the month’s single largest transaction.

• Enlight Renewable Energy (CO Bar Complex) (USA) - $2.62B financial close on the CO Bar complex - 1.2 GW solar + 4.0 GWh storage, Enlight’s largest project to date.

• Hybar (USA) - $1.10B scrap-based electric-arc-furnace mill producing low-carbon reinforcing bar (TPG Rise Climate, Koch among backers).

• Origis Energy (USA) - $900M credit facility for utility-scale solar and storage development.

• ERock (Enchanted Rock) (USA) - $600M NYSE listing (EROC) for resilient backup-power infrastructure (~$4.7B implied) - the month’s largest equity event and a signal the IPO window has reopened.

• Grape Solar and Energy Storage Project (Permanent Power Company / CIM Group) (USA) - $600M construction financing for 246.4 MWac solar + 600 MWh storage.

• Helion Energy (USA) - $465M Series G at ~$15.5B (Thrive Capital); magneto-inertial fusion with a Microsoft offtake - the largest fusion round of 2026.

• Standard Nuclear (USA) - $383.2M filed for a NYSE listing (STDN) of its TRISO advanced-reactor fuel business - announced, not yet priced.

• Spearmint Energy (USA) - $325M debt for grid-scale battery energy storage (BESS).

• TeraWatt Infrastructure (USA) - $300M charging infrastructure for medium- and heavy-duty electric fleets.

• Lime (USA) - $167M priced its Nasdaq IPO (LIME) for shared electric bikes and scooters at a ~$1.8B fully diluted valuation.

• Solar Landscape (USA) - $125M community and commercial rooftop solar on U.S. warehouse roofs.

• Thea Energy (USA) - $100M planar-coil stellarator fusion; magnet manufacturing as the differentiator.

• ZutaCore (USA) - $100M waterless two-phase direct-to-chip liquid cooling for AI data centres (Mitsubishi Electric, Samsung Ventures).

• Boston Metal (USA) - $75M molten oxide electrolysis for steel and critical metals without coal (strategic capital from Tata Steel).

• Highland Electric Fleets (USA) - $75M electrification-as-a-service for electric school-bus fleets (Galvanize follow-on).

• Climate First (Climate First Bancorp) (USA) - $67M impact retail bank built around solar lending (Wellington, AllianceBernstein).

• Endurance Energy (USA) - $54M subsea/seafloor geothermal for 24/7 carbon-free baseload (Founders Fund lead).

• InCharge Energy (USA) - $46M EV charging, electrical infrastructure and DER services across 30,000+ assets (S2G, QIC).

• Deep Fission (USA) - $40M SMRs in deep boreholes; a public offering that priced below plan and undersubscribed - a caution signal.

• Tomorrow.io (USA) - $35M AI-native weather intelligence plus the DeepSky satellite constellation - climate data with a direct adaptation use case.

• Evotrex (USA) - $30M power-generating off-grid hybrid RV trailers (Anker among backers).

• Cuprum Metals (USA) - $19.4M low-emission copper leaching/extraction for critical-minerals supply (Lundin, BHP Ventures).

• Leaf Agriculture (USA) - $13M API and data layer connecting farm machinery and agribusiness software (Leaps by Bayer).

• Mantle Energy (USA) - $5M enhanced-recovery and geothermal project development.

• Moment Energy (Canada) - $3M second-life EV batteries repurposed into stationary storage (catalytic grant + repayable).

Asia and RoW

Asia

Asia-Pacific recorded ~$3.3B across 39 deals - the deal-count leader with the smallest average cheque. India dominated the renewables, hydrogen and green-financing long tail, while China anchored an unexpected fusion cluster plus battery and grid rounds.

Key June highlights from Asia:

• Avaada Group (3 projects: Bikaner FDRE, Rajasthan 300 MW solar, Gujarat 300 MW solar) (India) - $950M financial close across three utility-scale projects including a firm-and-dispatchable (FDRE) project in Bikaner - India now procuring shaped, firm renewable power.

• Mirattery (Weineng / Nio BaaS) (China) - $281M green securitisation against Nio’s Battery-as-a-Service fleet (two instruments: ~$135M ABS + ~$146M ABN).

• Ganfeng LiEnergy (赣锋锂电) (China) - $278M capital increase into Ganfeng’s battery unit from Chinese bank AICs; power/storage cells and solid-state activity.

• IREDA (Indian Renewable Energy Development Agency) (India) - $161M Indian Renewable Energy Development Agency non-convertible-debenture bond for renewables financing.

• Bhutan Solar Farm Expansion (ADB) (Bhutan) - $160M ADB loan for three solar farms under Bhutan’s first private-majority energy PPP.

• Continuum Green Energy (India) - $145M wind/solar/hybrid IPP for C&I corporate PPAs (Chubu Electric strategic position).

• Huaihe Energy Holding Group (淮河能源控股集团) (China) - $139M carbon-asset-linked green bond (MTN) from a Chinese energy group.

• Zhongke Fuhai (中科富海) (China) - $139M CAS-affiliated cryogenic and liquid-hydrogen equipment maker (pre-IPO; Guoke Capital).

• Hygenco Green Energies (India) - $105M green hydrogen/ammonia under a Hydrogen-as-a-Service model - a composite of five blended tranches (IFC, Siemens, Fullerton, CIF).

• Xinghe Fusion / Star Nucleus Fusion (星核聚变) (China) - $115M stellarator-route fusion with high-temperature superconducting magnets (SAIC, Shenzhen Capital among 24 investors).

• NYK Line (Nippon Yusen Kaisha) (Japan) - $89M transition bond funding LNG-fuelled and alternative-fuel vessels toward 2050 net-zero - the strongest Japanese climate bond of the month.

• JBM Ecolife Mobility (India) - $81M electric-bus fleet financing (debt + equity-linked).

• GPS Renewables (GPSR) (India) - $66M compressed-biogas and SAF infrastructure; building India’s first ethanol-to-jet plant (PixelSky lead).

• SolarSquare (India) - $53M full-stack residential rooftop solar, ~50,000 homes served (B Capital lead).

• Weilan Zhidian / Blue Fulcrum (蔚蓝支点) (China) - $28M passive integrated water-cooled SMR for AI data centres and industrial heat.

• Simple Energy (India) - $27M long-range electric scooters with an in-house powertrain (composite: ~$15M equity + ~$14M debt).

• Exponent Energy (India) - $21.1M 15-minute rapid charging for commercial EVs (TDK Ventures co-lead).

• Sri Lanka rooftop solar & virtual net metering (ADB) (Sri Lanka) - $35M ADB concessional loan for utility-led rooftop-solar aggregation and virtual net metering (~25 MW).

• Manam Chocolate (Distinct Origins) (India) - $9M bean-to-bar sourcing from 250+ regenerative cacao farmers (Omnivore lead).

• H3 Zoom (Singapore) - $3.6M AI infrastructure inspection and built-asset intelligence.

• Terraxy (Saudi Arabia) - $3M soil-regeneration technology for arid/desert agriculture (Aramco’s Wa’ed Ventures).

• SatSure Analytics (India) - $2.6M sovereign AI Earth-observation models for agriculture, climate and disaster response (IN-SPACe grant).

• Unnati Agri (India) - $1.8M full-stack smallholder agritech platform (venture debt).

RoW

RoW (Australia, Africa, South America) recorded ~$8.1B combined across 43 deals. Australia led at ~$4.6B (8 deals, heavily federal programmes), followed by Africa (~$2.1B, 25 deals) and South America (~$1.1B, 10 deals). As in prior editions, the picture remains anchored by government programmes, MDB/DFI interventions and blended-finance structures, while commercial private capital stays concentrated in a few large closes - with mobility (Spiro) the standout private breakout.

Selected June highlights:

• Capacity Investment Scheme Tender 8 (battery storage) (Australia) - $3.90B federal revenue-underwriting for 15 grid-scale battery projects (4,205 MW / 16,074 MWh) - the largest storage procurement in the tracker to date.

• Ecobank Transnational (Nature Bond) (Multi-region) - $450M the first ICMA-designated Nature Bond from a commercial bank, 3.9x oversubscribed; funds sustainable production and water across 24 markets.

• Morocco Climate & Risk Finance Program (Morocco) - $400M World Bank programme strengthening sovereign resilience to climate, disaster and cyber risk.

• Home Energy Saver Program (NSW) (Australia) - $368M zero-interest loans and rebates for household solar, batteries, heat pumps and insulation.

• Spiro (Multi-region) - $215M pan-African electric two-wheelers and battery swapping across seven markets ($215M + $55M extension; Impact Fund Denmark, Equitane, FEDA).

• Inkia Energy (Altérra / I Squared co-investment) (Peru) - $300M renewable-generation IPP co-investment (Altérra, I Squared).

• Climate Investment Funds - Brazil industrial decarbonisation (Brazil) - $250M concessional programme to decarbonise steel, cement, chemicals and aluminium.

• Climate Investment Funds - Mexico industrial decarbonisation (Mexico) - $250M concessional programme to decarbonise heavy industry.

• Zafiri (Multi-region) - $176M permanent-capital blended vehicle for distributed renewables, mini-grids and clean cooking (Mission 300).

• Innergex (northern Chile BESS + refinancing) (Chile) - $156M northern Chilean battery storage plus renewables refinancing.

• IDB Invest - Swiss franc blue bond (Multi-region) - $127M Swiss-franc blue bond for water and marine assets.

• WeLight (Multi-region) - $31M Africa’s largest solar mini-grid operator (~190 grids, 800,000+ people), expanding to Nigeria and the DRC (IFC-led).

• Development Bank of Nigeria (EIB Global facility) (Nigeria) - $229M EIB Global green-SME lending facility.

• Mulilo - Hartebeesfontein BESS (South Africa) - $50M Hartebeesfontein battery storage (77 MW / 308 MWh), project finance.

• d.light (Multi-region) - $50M off-grid / PAYG solar green bond / securitisation (Nigeria mini-grid guarantee separately).

• MAKO (formerly MicroTau) (Australia) - $20M sharkskin-inspired drag-reduction film cutting aircraft fuel burn (>4% net drag reduction on USAF C-130J; CEFC-backed).

• Sicona Battery Technologies (Australia) - $30M silicon-carbon anode materials; first commercial-scale facility (ARENA, Port Kembla siting).

• Dawn Aerospace (New Zealand) - $25M reusable spaceplanes and green in-space propulsion.

• Belize climate resilience programme (Belize) - $10.1M weather-radar and forecasting upgrades and early-warning systems (Caribbean Development Bank).

• Zimi Charge (South Africa) - $2.6M EV charging infrastructure and charge-point-operator ecosystem in South Africa (DBSA).

• Agriarche (Nigeria) - $1.7M agritech linking smallholders to inputs, finance and markets (catalytic).

• RoboCare (Tunisia) - $0.5M AI precision-agriculture (satellite, drone, IoT) cutting water use up to 35% - Tunisian climate-adaptation tech.

What will we observe in H2 2026?

The cleanest new signal of the month was that the public markets reopened for climate - though selectively. Whether the fusion and geothermal cheque-writing keeps climbing, whether Europe’s green-industrial FIDs keep closing after Stegra, and whether the reopened IPO window stays open through H2 will tell us how durable June’s turn really is. Adaptation remains the persistent gap: $825M, 2.4% of the month, in the hottest June on record. We will be watching whether the themes identified in December continue to deepen:

• U.S.: Nuclear and Geothermal vs. Rest of World: Solar and Wind - strongly supported, now trilateral as China enters the frontier

• “Solarpunk” Momentum - electrification beyond cars, powered by cheap batteries; the best-supported theme in June

• Dual-Use Innovation: Climate + Defense, Supply Chain, Compute - real, but less visible in June (except for compute)

• CapEx-Intensive Mid-Stage Tech and the “Valley of Death” - strongly supported, with Stegra as the template

• Industrial Heat Electrification - weak in June; awaiting more traction in this space

• Nature-Based Solutions for Carbon and Biodiversity - moderate; one bond carried the category

• AFOLU Innovation - diverse but small-cheque

• The Rise of Climate Robotics - less visible in June

Stay tuned for next month’s edition as we continue to follow the capital shaping the climate transition.

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Hey there! 👋
Skander here.

$41 billion across 122 deals. After April reset the ceiling at $55B, May settled back into a more typical month. The structure underneath sharpened, though: almost every big theme now routes through the AI energy bottleneck.

Jarek’s latest Follow the Money breaks down where the capital actually went, and the regional splits tell the story.

🇪🇺 Europe: $11.4B across 30 deals, leading the month. Two industrial anchors set the tone: Germany’s $5.9B Carbon Contracts for Difference scheme and Vulcan Energy’s €2.2B financial close for carbon-neutral lithium from geothermal brine (enough lithium hydroxide for ~500,000 EVs a year). Below them, one of the deepest mid-stage deep tech layers anywhere: Focused Energy’s $240M fusion Series A (RWE is providing a decommissioned nuclear site for the demonstrator), ICEYE’s €300M SAR satellite facility, and the EU’s first dedicated industrial heat auction, awarding €400M across 65 projects.

🇺🇸 North America: $10.9B across 27 deals, the sharpest thematic concentration of the month. The U.S. is buying firm, dispatchable power for the AI build-out at a pace no other region matches. Fervo Energy priced Wall Street’s largest clean energy IPO ever at $1.89B, opened 35% up, and closed above a $10B market cap, backed by a Google framework for up to 3 GW of enhanced geothermal. Thea Energy raised $100M for stellarator fusion, Enchanted Rock filed a ~$600M IPO on a $1.3B data center backlog, and Panthalassa raised $140M for floating ocean nodes that run AI inference on wave power.

🌏 Asia: $5.0B across 30 deals. China anchored the truck and battery rounds: Zeron raised a $200M Series B2 (roughly $400M in two months) for autonomous electric heavy trucks, and Sunwoda’s power unit added ~$228M ahead of a Hong Kong IPO. India filled the renewables long tail, led by CleanMax’s $575M project financing for ~1 GW of C&I solar and wind, plus Bhutan’s $515M Dorjilung hydropower scheme.

🌍 Rest of World: $13.6B across 35 deals. Australia had a huge month at $9.4B, driven by the A$7.2B Cheaper Home Batteries program and Edify Energy’s $2.08B solar-plus-storage close, with Rio Tinto buying 90% of output for 20 years to power aluminium smelting. Brazil’s Acelen closed $1.5B for a biorefinery producing 1 billion liters of SAF and renewable diesel per year.

A few patterns worth flagging: a cluster of raises (GridCARE, Utilidata, Nyobolt, Iceotope, Star Catcher) exists purely to feed or firm AI compute, so climate capital is increasingly AI-energy capital. The EU heat auction went 77% to mature resistance heating, with zero geothermal, a reminder of how early industrial heat electrification still is. And the strangest signal came from a trading desk: Mexico City’s Moreton Capital is raising $500M to trade corn, palm oil and wheat against a super El Niño that NOAA now gives two-in-three odds by winter. Climate finance has started pricing the weather itself.

🌊 Jarek breaks it all down below, region by region, theme by theme.

But first: Who is Jarek?

Jarek Dmowski is a global transformation leader who partners with high-growth companies with positive climate impact. He combines industry and climate finance expertise with a strong track record of driving growth—across PE/VC-backed scaleups, ABN AMRO, and BCG.

He scaled a data-driven technology company ~2.5x to ~$25M in revenue and led post-merger integrations that enabled ~6x accelerated growth. At a global financial institution, he spearheaded a $2B capital reallocation toward new energy and mobility. He also developed a comprehensive climate plan that translated the Paris Agreement into actionable targets across sectors and established a $250M program to drive efficiency gains and reduce emissions at an energy utility.

Jarek is passionate about how the climate transition reshapes economies and business models, creating significant opportunities for multi-country growth and impact.

Follow the Money - May 2026

by Jarek Dmowski

Welcome to the next edition of “Follow the Money” - a monthly briefing on the capital flows shaping the climate transition.

$41B in May. America’s ~$2B geothermal IPO. A €2.2B carbon-neutral lithium close. And Europe’s first industrial-heat auction.

After April reset the ceiling at $55B, May settled back into a more typical - but still substantial - month: 122 tracked climate-related investments worth $41B.

The most striking signal may not have come from a startup round, but from a trading desk. Mexico City-based hedge fund Moreton Capital Partners is reportedly raising $500M for a special-purpose vehicle to trade commodities exposed to a potential “super El Niño” - from South African corn and Malaysian palm oil to Australian wheat. With NOAA now putting the probability of a very strong event by winter at roughly two-in-three, the message is hard to miss: climate finance is not only about building the new system. It is also about pricing the physical climate risk.

On the financing side, the through-line was unmistakable: capital is being routed through the AI energy bottleneck. The U.S. took its biggest geothermal developer public in a ~$1.9B Nasdaq IPO. Fusion raised on both sides of the Atlantic. Europe closed a €2.2B carbon-neutral lithium-and-geothermal project. And a wave of grid-software, exotic-power and high-power-battery rounds all pointed toward the same customer: the data center. Let’s dive deeper.

Where did money flow in May 2026?

Explanation of the approach and source data: The investment list was developed based on disclosures, newsletter monitoring and review of climate news. Although not exhaustive, 122 climate-related investment deals were tracked - amounting to roughly $41 billion (all data in US$), covering all continents and different life stages of companies and development finance programs. Data skew toward early-stage companies and investments, as well as development financing programs. We are continuously working to expand the data sources and coverage of investments.

So, where did the money flow in April 2026?

• Europe led the month with ~$11.4B across 30 deals, followed closely by North America (~$10.9B, 27 deals) and Australia (~$9.4B, 15 deals) - the latter swollen by Australia’s federal budget programs. Asia (~$5.0B, 30 deals), Latin America (~$2.3B, 6 deals) and Africa (~$1.9B, 14 deals) rounded out the field. Unlike April, no single region dominated.

• Energy once again dominated, accounting for ~$27.8B across 69 deals - by far the largest category, month after month. Industrial was a clear #2 (~$10.7B, 16 deals), lifted by Germany’s carbon-contracts scheme and Vulcan’s lithium close, followed by Transport (~$1.0B), AFOLU (~$0.6B), Climate Data (~$0.5B), Adaptation & Resilience (~$0.2B) and Buildings (~$36M). Buildings remained structurally undercapitalized relative to its emissions share - a persistent gap.

• AI’s influence is now structural. A cluster of raises – grid-capacity software (GridCARE $64M, Utilidata $40M), exotic generation (Panthalassa $140M, Star Catcher $65M), high-power batteries (Nyobolt $60M) and data-center cooling (Iceotope $26M) – all exist to feed or firm AI compute.

• Public and development finance anchored the market at scale. Multilateral institutions and government programs again supported well over $15B - from Germany’s ~$5.9B carbon-contracts-for-difference scheme and Australia’s battery and cleaner-fuels programs to a number of MDB and DFI infrastructure, adaptation and on-lending facilities across Africa, Asia and Latin America.

Let’s now dive deeper into 2026 watchlist themes (please refer to our December perspective for more details) and across regions to highlight technologies with real scaling potential over the next 3-5 years.

Which (of our 2026) themes were most strongly visible in April?

U.S: Nuclear and Geothermal vs. RoW: Solar and Wind

The divergence we have tracked since December held firmly in May. In North America, capital concentrated in dispatchable, capital-heavy power for the AI build-out. The headline was Fervo Energy, which priced Wall Street’s largest clean-energy IPO ever on May 12 at $27/share – above range – raising ~$1.89B (rising to ~$2.17B with the over-allotment) and opening ~35% up for a market cap above $10B. Its enhanced geothermal systems (EGS) turn horizontal drilling and fiber-optic sensing into engineered, dispatchable baseload, backed by a Google framework agreement for up to 3 GW. Fusion raised on both coasts of capital, too: Thea Energy closed a $100M Series B for its software-shaped “planar coil” stellarator, while gas-microgrid developer Enchanted Rock filed for a ~$600M IPO on the back of a ~$1.3B data-center backlog.

“Solarpunk” Continues

The “cheap batteries + localized electrification” thesis kept widening across road, rail, air and water. The deepest layer was again road freight in China: autonomous electric-truck maker Zeron (Jiangsu Zero One Auto) raised a $200M Series B2 – roughly $400M in two months – for vertically-integrated electric heavy trucks, while Zaihe Truck passed ~$140M cumulative financing for AI-defined new-energy trucks, including a hydrogen-electric flagship with ~1,500 km range. In the air, China’s TransFuture Aviation raised a ~$15M Pre-A+ for a tilt-rotor passenger eVTOL.

The supporting toolkit scaled too. Nyobolt (UK) closed a $60M Series C at a $1B valuation for niobium-anode batteries that charge 0–80% in under five minutes – built for warehouse robots, humanoids and data-center UPS rather than just cars. Austria’s REPS raised ~$24M for a magnet-based “road power plant” that harvests kinetic energy from decelerating trucks (already live at the Port of Hamburg), and Germany’s CMBlu Energy added a ~$59M initial Series C close for non-lithium organic flow batteries.

Dual-Use: Climate + Defense

This was arguably the defining cross-cutting theme of May. As climate volatility and geopolitical risk converge, investors are funding companies that braid resilience, decarbonization and national security into a single thesis. Finland’s ICEYE secured a €300M (~$326M) revolving credit facility to scale the world’s largest SAR satellite constellation – all-weather flood and disaster monitoring with an obvious defense/intelligence dual-use. Tomorrow.io (USA) added $35M to its Series F for AI-native weather intelligence and its “DeepSky” satellites, with the U.S. DoD, Air Force and NASA among its customers. Star Catcher (USA, $65M) is building an orbital power grid – and has the former first Chief of Space Operations of the U.S. Space Force on its board – while Germany’s LiveEO ($33M) drew in defense-focused VC Helantic for AI satellite monitoring of grids, rail and pipelines.

Industrial Heat Electrification

The clearest single signal was the EU Innovation Fund’s first dedicated industrial-heat auction (IF25), which on May 22 selected 65 projects for ~€400M (~$466M) of grants across ten countries – expected to deliver ~16.3 TWh of decarbonized heat over five years and avoid 6.6 Mt CO₂, displacing more than 1.5 billion m³ of natural gas. Notably, the awards were dominated by mature resistance heating (~77% of projects), with thin representation of heat pumps and solar thermal and no geothermal – a reminder that, even with policy support, industrial heat electrification is still early.

Europe

Europe recorded ~$11.4B across 30 deals, leading the month - blending very large public-finance and industrial packages with one of the deepest mid-stage deep-tech layers in the world: carbon-neutral lithium, fusion, flow batteries, natural hydrogen, SAR intelligence and refrigerant-free heat.

The structural anchors were two industrial-decarbonization packages – Germany’s ~$5.9B EU-cleared Carbon Contracts for Difference scheme and Vulcan Energy’s ~$2.4B Lionheart financial close – reinforcing the pattern of European public finance underwriting deployment while private capital concentrates on first-of-a-kind technology. Below them, a wide variety of clean tech investments.

Selected May financings:

• Vulcan Energy Resources (Germany) – ~€2.2B Phase One Lionheart financial close (May 28); integrated carbon-neutral lithium + geothermal energy producing 24,000 t/yr lithium hydroxide (enough for ~500,000 EVs) via proprietary VULSORB direct-lithium-extraction, powered by geothermal brine.

• Focused Energy (Germany) – $240M Series A, described as the largest fully-secured fusion Series A to date; utility RWE led and is providing the decommissioned Biblis nuclear site for the “Lighthouse” direct-drive inertial-fusion demonstrator.

• ICEYE (Finland) – €300M (~$326M) three-year revolving credit facility (Citi, Danske Bank lead) for the world’s largest SAR satellite constellation; flood/disaster monitoring with a strong defense dual-use.

• Nyobolt (UK) – $60M Series C at a $1B valuation (Symbotic lead); niobium-tungsten-oxide anodes charging 0–80% in under five minutes, >20,000 cycles, for robots, humanoids and data-center UPS.

• CMBlu Energy (Germany) – ~€50M (~$59M) initial Series C close (Samsung Ventures joining), crossing unicorn status; “SolidFlow” non-lithium organic flow batteries with a 5 GWh Uniper framework.

• Mantle8 (France) – €31M Series A (Sandwater lead, with Breakthrough Energy Ventures); proprietary 4D subsurface imaging to locate high-purity natural (geologic) hydrogen at modeled costs as low as €0.80/kg.

• Iceotope (UK) – $26M Series B (Two Seas Capital, Barclays Climate Ventures); chassis-based precision liquid cooling cutting data-center power up to 40% and water up to 96%.

• Lithosquare (France) – $25M seed (World Fund, Kindred Capital co-lead); a “geology AI” foundation model accelerating discovery of copper, lithium and rare earths up to 10x.

• REPS (Austria) – ~$24M for a magnet-based “road power plant” harvesting kinetic energy from decelerating vehicles, live at the Port of Hamburg.

• Barocal (UK) – $10M seed (World Fund, Breakthrough Energy Discovery); refrigerant-free solid-state barocaloric heating and cooling, a Cambridge spinout.

• GreenWay (Poland) – ~$131M EBRD senior loan (EU InvestEU first-loss guarantee) to build 2,700 fast and ultra-fast public charging points across Poland, Slovakia and Croatia by 2028.

• Stafford Capital Partners (STAR I) (Italy) – ~$105M project-finance refinancing (with BPER) to revamp and repower a 30-plant operational Italian solar PV portfolio.

• SkyKraft eSAF JV (Sweden) – ~$24M Swedish Energy Agency / Industriklivet grant to SkyNRG and Skellefteå Kraft for a planned facility producing up to 130,000 t/yr of electro-SAF from renewable electricity and biogenic CO₂.

• Reel (Denmark) – ~$18M Series A; optimization and energy trading for batteries and solar plus B2B clean-electricity supply.

• Elvy (Sweden) – ~$7M equity (atop a €500M credit facility) for a fully integrated residential solar + heat-pump + battery energy subscription.

• Imperagen (UK) – ~$7M seed; quantum-simulation + AI + robotics enzyme engineering for sustainable chemicals and biocatalysis.

• Caudal Energy (UK, formerly Porpoise Power) – ~$6M for predictable mid-flow tidal power systems inspired by marine-mammal locomotion.

• Invertix (Germany) – ~$2M pre-seed; autonomous “AI workers” automating O&M, alarm triage and reporting across >1.8 GW of managed solar.

• Ecodetect (UK) – ~$1M angel/co-investment; an AI/ML underwater-imaging toolkit identifying wildlife interactions with offshore-renewables infrastructure.

North America

North America recorded ~$10.9B across 27 deals - the sharpest thematic concentration of the month. The defining narrative is now unmistakable: the U.S. is buying firm, dispatchable power and the infrastructure to feed AI - geothermal, fusion, gas microgrids, grid-capacity software and critical materials - at a pace and conviction no other region matches.

Selected highlights:

• Fervo Energy (USA) – ~$1.89B IPO (rising to ~$2.17B with the over-allotment), priced above range at $27/share on Nasdaq (FRVO) – Wall Street’s largest clean-energy IPO ever; enhanced geothermal (EGS) baseload backed by a Google framework for up to 3 GW and a ~$7.2B contracted-revenue backlog.

• IPX Power / Darden (USA) – $4.95B construction financing for up to 1.15 GWac solar + 4.6 GWh storage in Fresno County, CA; the utility-scale spinout of Intersect Power following Google’s $4.75B acquisition.

• Panthalassa (USA) – $140M Series B (Peter Thiel’s Founders Fund lead); self-propelled floating ocean nodes that capture wave energy and run AI inference onboard, cooled by seawater.

• Thea Energy (USA) – $100M Series B (Thomas Tull’s USIT lead); a software-shaped “planar coil” stellarator replacing complex 3D magnets with mass-manufacturable flat arrays.

• Boston Metal (USA) – $75M growth round with new strategic investor Tata Steel; molten oxide electrolysis for low-carbon steel and critical metals, now pivoting near-term to niobium, tantalum and vanadium.

• Star Catcher (USA) – $65M Series A (B Capital lead); an orbital power grid that beams concentrated sunlight via optical power beaming to client satellites’ existing panels – a clear climate + defense dual-use.

• GridCARE (USA) – $64M Series A (Sutter Hill Ventures lead); physics-based AI that finds latent grid capacity and compresses data-center interconnection from years to months.

• Utilidata (USA) – $40M Series C extension completing a $100M round; the NVIDIA-based “Karman” platform embedded at the data-center rack to unlock stranded power capacity.

• Enchanted Rock (ERock) (USA) – ~$600M IPO filing (NYSE: EROC) on a ~$1.3B data-center backlog; low-emission natural-gas microgrids as bridge-to-power amid interconnection delays (a speed-to-power, not zero-carbon, play).

• Magrathea (USA) – $24M Series A; carbon-neutral magnesium from seawater via next-generation molten-salt electrolysis, a DoD-backed defense-critical “gateway metal.”

• CREW Carbon (USA) – $25M Series A ($19M equity + $6M grant; Burnt Island Ventures lead); wastewater alkalinity enhancement permanently converting CO₂ to bicarbonate, a Yale spinout with >$33M of offtake.

• Moment Energy (Canada/USA) – $40M Series B; repurposing second-life EV batteries into UL-certified stationary storage systems.

• Novisto (Canada) – ~$27M strategic investment (La Caisse) for enterprise ESG, carbon and risk data management and disclosure software.

• Aboard (USA) – ~$13M Pre-Series A; a next-generation electric recreational-vehicle / travel-trailer manufacturer.

• Shatterdome Energy (USA) – ~$4M pre-seed; an AI-powered energy-trading and virtual-power-plant platform aggregating renewables, storage and flexible demand..

Asia and RoW

Asia

Asia-Pacific recorded ~$5.0B across 30 deals, with China anchoring battery, truck and grid rounds and India dominating renewables, hydropower and the green-financing long tail.

Key highlights from Asia:

• HKSAR Government (Hong Kong) – ~$817M green-bond tranche (an €750M 8-year piece) financing eligible green and infrastructure projects.

• Pentagreen Capital (Singapore) – ~$800M second close of its blended Green Investments Partnership for sustainable infrastructure across South and Southeast Asia.

• CleanMax (India) – ~$575M project finance (ECB + FCNR(B) + INR facilities) for ~1 GW of C&I solar and wind across Rajasthan and Karnataka; Apple separately took a ~$12M stake supporting >150 MW.

• Dorjilung Hydropower (Bhutan) – ~$515M World Bank / Tata Power development of a 1,125 MW hydropower scheme.

• Zeron (Jiangsu Zero One Auto) (China) – $200M Series B2 (Temasek, Zijin Mining); vertically-integrated autonomous electric heavy trucks for mining and industrial logistics.

• Sunwoda Power / EVB (China) – ~RMB 1.68B (~$228M) Series C capital increase; EV power batteries and storage expanding into solid-state, sodium-ion and AI data-center backup, ahead of a Hong Kong IPO.

• Ola Electric (India) – ~$209M intra-group infusion to localize EV and Li-ion cell production.

• Zaihe Truck (China) – ~$140M cumulative financing (Baidu Ventures, Horizon Robotics); AI-defined new-energy heavy trucks including a ~1,500 km hydrogen-electric flagship.

• Zhibang Lithium (China) – ~RMB 500M (~$74M) Series A (backed by the Nongfu Spring founder’s Yangshengtang); solid-state battery electrolyte materials with an 11,000 t/yr project near production.

• TransFuture Aviation (China) – ~$15M Pre-A+ for a tilt-rotor passenger eVTOL with autonomous takeoff and landing.

• Tuoshen Technology (China) – ~$40M D round; an AI current-signature platform for user-side electricity safety, energy management and new-energy device monitoring.

• Stride (Vietnam) – ~$15M Series B for a rooftop solar and storage financing platform.

• Ecofy (Mirova facility) (India) – ~$15M impact/DFI-style loan from Mirova; a green-only NBFC lending for rooftop solar and EVs.

RoW

RoW (Africa, Latin America, Oceania) recorded ~$13.6B combined across 35 deals. Australia led at ~$9.4B (15 deals - heavily Australian government programs), followed by Latin America (~$2.3B, 6 deals) and Africa (~$1.9B, 14 deals). As in prior editions, the picture across these markets remains anchored by government programs, MDB and DFI interventions and blended-finance structures, while commercial private capital stays comparatively concentrated in a few large project closes.

Selected highlights:

• Australia Cheaper Home Batteries Program (Australia) – ~A$7.2bn (~$4.68B) residential battery-subsidy program targeting 2m+ home batteries by 2030 (a program, not a single transaction).

• Edify Energy (Australia) – ~$2.08B financial close on the Smoky Creek & Guthrie’s Gap hybrid (600 MW solar + 600 MW/2,400 MWh battery), with Rio Tinto buying 90% of output for 20 years to power Gladstone aluminium.

• Acelen Renewables (Brazil) – ~$1.5B HEFA biorefinery financing (HSBC + IFC lead, deep DFI syndicate) for 1 billion L/yr of SAF and renewable diesel from macaúba, soybean and used cooking oil.

• Marinus Link / NWTD (Australia) – ~$780M CEFC concessional financing for the North West Transmission Developments enabling the Marinus Link HVDC interconnector.

• Sunswap (Australia) – ~$7M CEFC growth capital to deploy 100+ electric, solar-assisted “Endurance” trailer refrigeration units replacing diesel in cold-chain fleets.

• OCP Group (Morocco) – ~€450M (~$489M) AfDB partial credit guarantee unlocking up to €530M of green financing for low-carbon phosphate fertilizer, renewables and desalination.

• Grenergy (Oasis) (Chile) – ~$268M senior non-recourse project finance for 342 MW solar + 1,034 MWh of storage under a daytime PPA.

• Scatec (Obelisk) (Egypt) – ~$150M EIB tranche within a ~$479M DFI package for Africa’s biggest hybrid plant (1.1 GWp solar + 100 MW/200 MWh BESS), first phase commissioned February 2026.

• Apollo Agriculture (Kenya) – first close of Kenya’s first private-sector smallholder-ag securitisation (~KES 276M of a ~KES 2.37B program), underwritten with satellite imagery and ML yield models.

• Tree+ (Tree Agroflorestal) (Brazil) – ~$8M BNDES Climate Fund tranche to restore ~37,000 acres of Atlantic Forest and develop carbon credits.

• UNEP Ethiopia Green Legacy (Ethiopia) – $9.8M GEF-funded reforestation and ecosystem-based adaptation across 67,000+ hectares, benefiting 423,000+ people.

What will we observe in 2026?

At ~$41B, May proved that April’s $55B was a spike rather than a new baseline - but the structure we have tracked all year held and, if anything, sharpened: firm, capital-heavy power in the U.S.; mass-market and utility-scale electrification across Asia and Oceania; policy-backed project finance and deep tech in Europe; and blended adaptation and nature finance across the Global South.

The cleanest signal of the month was that climate capital is increasingly AI-energy capital. Whether the next month sees fusion and geothermal raises keep climbing while solar-plus-storage project finance broadens will tell us whether the “firm-power premium” is a durable structural feature or a 2026 moment. We will be watching whether the themes identified in December continue to deepen:

• U.S.: Nuclear and Geothermal vs. Rest of World: Solar and Wind

• “Solarpunk” Momentum - electrification beyond cars, powered by cheap batteries

• Dual-Use Innovation: Climate + Defense, Supply Chain, Compute

• CapEx-Intensive Mid-Stage Tech and the “Valley of Death”

• Industrial Heat Electrification

• Nature-Based Solutions for Carbon and Biodiversity

• AFOLU Innovation - including climate adaptation, robotics, and alternative proteins

• The Rise of Climate Robotics

Stay tuned for next month’s edition as we continue to follow the capital shaping the climate transition.

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Hey there 👋
Skander here.

The average U.S. power grid runs at about 30% utilization. Roughly 70% of it sits idle on a normal day, even while everyone in the room swears there’s no room left to plug in one more data center.

Somewhere in that gap sits a large, cheap answer to the AI power crunch, if you can find it.

GridCARE looked at one slice of National Grid, the same network with a years-long waiting list, and found 650 megawatts already sitting there.
Phaidra ran cooling software on live NVIDIA clusters and freed up enough thermal headroom that, on a gigawatt site, raising the loop temperature ten degrees hands 67 megawatts back to compute.
Emerald AI puts the full number at 100 gigawatts of usable capacity hiding on the existing grid.

The AI buildout is the biggest new load hitting the grid, and how much of it gets served by fresh gas versus capacity we already own shapes the emissions math for the next decade. If software can surface the stranded gigawatts, the trillion-dollar pour gets smaller, and a good chunk of the panic about AI eating the grid turns out to be a measurement problem.

We’ve watched a version of this before. Telecom companies buried fibre through the dotcom boom, betting traffic would catch up. Most of it sat dark for years and looked like the biggest overbuild in history, right until streaming and cloud arrived and turned it into the backbone of the internet.

Ananya’s read today is that AI infrastructure is at its own dark fibre moment, except the buried asset this time is gigawatts, on the grid and inside the data centers we’ve already built.

Ananya is an ex-consultant, VC and operator who works at the seam of emerging technology, strategy, and company building. She wrote this while actively looking for where to build next in the space, which is about the best reason to trust the map she’s drawn.

She walks through the companies turning software into grid infrastructure, the reasons this capacity stayed stranded for so long, and the bets she’s making anyway, open questions and all.

Today we’re looking at:

• Why a data center can be financed and built in about 18 months but takes five to seven years to power

• The 70% of the grid that sits idle, and why the interconnection process was never built to see it

• How ten degrees of cooling water frees 67 megawatts on a single gigawatt site

• The four reasons the capacity stayed stranded: nobody’s incentives, justified fear, the cracks between systems, and a design built for a world where power was free

• Why Jensen wants to retire PUE and measure tokens per watt instead

• Where the value actually lands, and which layer is worth owning

🌊 Let’s dive in

First: Who is Ananya?

As an ex-consultant, VC and operator, Ananya Chopra has worked at the intersection of emerging technologies, strategy and company building. She’s drawn to 0 to 1 opportunities that require systems thinking, synthesis and cross-functional execution. She enjoys developing conviction through curiosity, building from ambiguity, and turning ideas into businesses. Long term, she hopes to build companies solving consequential technology and infrastructure challenges.

The next AI infrastructure opportunity is unlocking what we already have

Earlier this year, GridCARE looked at a slice of National Grid’s network, the same one with a years-long queue of projects waiting to plug in, and found 650MW of capacity. A couple of years ago, DeepMind pointed reinforcement learning at the cooling systems in Google’s data centers - it cut cooling energy by 40% leading to a 15% improvement in total facility overhead, using sensor data that already existed inside the building. Phaidra ran cooling agents on production NVIDIA Grace Blackwell clusters with CoreWeave and Applied Digital, cut thermal-spike overshoot by 75-80% and handed the recovered power back to compute: on a 1 GW factory, lifting the water from 25°C to 35°C frees roughly 67 MW for IT, about $3.8 billion a year in additional output.

We’ve seen this before. It was called dark fibre.

During the dotcom boom, telecom companies buried staggering amounts of fibre-optic cable into the ground, betting that internet traffic would explode. Then the bubble popped, and most of that glass just sat there, dark. For a few years it looked like one of the largest overbuilds in history. And then streaming happened. And cloud happened. And demand finally caught up to the cable that was already in the dirt, and that dark fibre quietly became the backbone of the modern internet.

I’ve come to believe AI infrastructure is sitting on its own dark fibre moment right now. Except this time, it’s gigawatts on the grid and inside the data centers we’ve already built.

Here’s the interesting part. The number a handful of companies are now putting on the table:

Emerald AI says power-flexible data centers could free up as much as 100GW on the existing U.S. grid. Hammerhead AI says it can squeeze 20–30% more compute out of the same grid allocation.

None of them are arguing against the buildout. They’re saying that alongside the trillion-dollar concrete-pour, a massive amount of usable capacity already exists and software can help unlock it.

Which raises the question: if the capacity is right there, why is nobody using it?

Start with the grid. Stanford research pegs average grid utilization at around 30%. Yes, 70% of the grid sits idle under normal conditions, managed conservatively, invisible to the interconnection process that decides what gets built. The famous 2,600-gigawatt interconnection queue, about 2x total U.S. installed capacity, gets cited as proof the grid is full.

Now walk into the data centers. Two-thirds of organizations report peak GPU utilization under 70%. Real-world GPU usage usually runs 10–40%. Most colocations idle along at 30–50%. Even the best hyperscalers hold it above 60–70%. And almost nobody publishes their real utilization numbers, so the entire industry is planning around a baseline nobody can actually see.

A lot of that “we’re out of room” is existing infrastructure that could carry load but never shows up in the analysis, because the analysis was never built to find it.

WHY “WE’RE OUT OF ROOM” IS A MEASUREMENT PROBLEM

The number that actually moves people

Morgan Stanley estimates roughly $4 billion in GPU-tenant revenue unlocked for every year you accelerate time-to-power. As Jensen Huang said, “Every data center in the future will be power-limited. Your revenues are power-limited.”

When power availability was of no consequence, excess capacity could be used to engineer reliability. In the era of AI and power-constrained data centers, software can enable a way to ensure reliability while maximizing output and unlocking more revenue.

Sense a swing and react in milliseconds instead of minutes, and you can operate against the real limit instead of a conservative guess. The proof is in the response times: Karman caps power in 20 milliseconds where software-only tools take two seconds; Phaidra reacts in under ten where conventional controllers take three to five minutes; Emerald answers a grid signal in under a minute. Each gap is margin you no longer have to pad. Speed is capacity.

Which brings us back to the whodunit: why is the gold still in the basement?

The capacity is stranded for rational reasons and which is exactly why it’s been so sticky.

Suspect #1: Nobody’s incentives point at the gold. A colocation provider passes power costs through to tenants at a markup. If better thermal management recovers 20% more compute, who actually wins hard enough to go re-engineer a system that currently works? The operator gets capacity to sell. The tenant gets headroom. Neither feels the pain sharply enough to force it. Blurry incentives are a fantastic preservative for inefficiency.

Suspect #2: The fear is justified. An NVL72 rack pulls 132 kilowatts. A few years ago, the average rack was 8-17 kW; a pre-GPU server rack was more like 5-10. Density more than doubled between 2021 and 2024, and AI racks now routinely blow past 50 kW. At that power density, the terror of a thermal event is competent risk management. Running cooling at max and provisioning for the worst case is what a smart operator does when the downside is fried hardware and tenants walking. Any software that asks them to ease off that baseline has to clear a high bar.

Suspect #3: The gold lives in the cracks between systems. In a typical data center, the building management system, the power distribution units, and the compute scheduler came from different vendors, on different standards, run by different teams, optimizing different things. Nobody’s job is to optimize across all three. The waste lives precisely at the seams which is exactly why has not belonged to anyone.

Suspect #4: The whole thing was designed for a different universe. Data centers were engineered for six nines uptime, worst-case provisioning at every layer. Google’s Amin Vahdat framed the tradeoff in a very interesting way: “four nines of availability and half the capacity, or two nines of availability and twice the capacity.” The design assumption that was never updated is creating gigantic costs.

And here’s the metric that lets everybody keep not-seeing it: PUE. Power Usage Effectiveness measures how efficiently a facility turns total power into IT load. It says nothing about what that IT load actually produces. Two data centers with identical PUE can crank out wildly different amounts of useful compute. Google’s fleet runs ~1.09, AWS ~1.15, Microsoft ~1.16 and the industry average is ~1.54. That gap is pure overhead, paid on every single workload, forever.

At GTC 2026, Jensen Huang proposed the replacement: tokens per watt. How much useful AI work you get per unit of power. That’s the real unlock here. Software makes these tradeoffs visible and actionable across boundaries that were never designed to talk to each other. It lights the fibre.

The Why Now?

Data centers have always run below theoretical capacity. So why is this suddenly a concern? Three shifts turned a chronic inefficiency into a five-alarm fire.

1. Training became inference. Training is the easy roommate: sustained, predictable, high-density GPU use over long batch runs. The infrastructure handles it fine. Inference is the chaotic one - bursty, latency-sensitive, spiking orders of magnitude in minutes based on what users do. And inference is taking over. By 2027, inference demand is projected to hit 400% of 2022 training levels. The cooling logic, power contracts, and schedulers we inherited from the training era are not optimized for the job they’re now being handed.

2. GPUs got easier; power got harder. The previous era was built on GPU scarcity: control the chips, control the pricing. But the binding constraint now is power. Grid connection in primary markets runs 4+ years. Transformers average 128-week lead times and in tight markets, four years. Meanwhile an AI facility can be financed and built in 12-24 months. The need of the hour is getting data centers connected on a timeline that matches how fast AI gets built.

3. Centralized training became distributed inference. Training lived in a handful of giant clusters run by hyperscaler-grade teams who could optimize everything. Inference needs to be near users (latency) and near data (sovereignty, compliance). So, the map is fragmenting into dozens of mid-sized regional facilities, 10-50MW, and as inference takes over, flexibility stops being something you do in time at one site and becomes something you do in space across many. There is no cookie cutter model and every site requires its own optimization.

So, how does software help unlock more capacity?

Go back to Suspect #3 for a second. The gold hiding in the cracks between systems. At a first glance, the AI infrastructure looks like a stack:

• Physical layer at the bottom: grid gates cooling, cooling gates compute; each a hard ceiling on the one above, operating in silos.

• Software above: Orchestration, data, inference. They continuously push demand, constraints, and tradeoffs back and forth.

• Governance all encompassing.

But it’s more like an interconnected web. A constraint at the grid eventually shows up in inference costs. A cooling breakthrough creates additional compute capacity without adding a single watt of generation. The cross-layer dependencies nobody owns are exactly where software earns its keep. It can make hidden constraints visible, tradeoffs measurable, and optimization possible, thereby increasing the amount of productive compute that can be generated from the same megawatt.

That coordination is increasingly happening inside the facility itself. Layer 2 is evolving from facility management into infrastructure orchestration. Historically, cooling, electrical systems and compute have been operated independently. As AI pushes facilities toward their physical limits, the value shifts to software that coordinates them as one system. That’s why I think this becomes one of the most interesting new infrastructure layers to emerge.

Opportunities in Layers 1 and 2

Layer 1: the grid problem

The 2,600-gigawatt queue gets read as “the grid is overwhelmed.” But today’s power constraint issues are heavily temporal and only affect the grid for a few hours of the year.

Remember the Stanford number: ~30% average utilization, ~70% idle under normal conditions. GridCARE’s platform, physics-based AI that it says evaluates “quadrillions of grid conditions in real time”, exists to drag that hidden capacity into the light. That’s how it found the 650 megawatts on National Grid.

Emerald AI is attacking the same layer by flexing data centers. Its Conductor platform orchestrates AI workloads across one or more facilities, flexing operations in real time against grid conditions while a digital-twin simulator guards performance. The mechanism, in plain terms: some workloads can wait, some can move, batteries can be called up, all choreographed at once to hand the grid a precise, verifiable flexibility response.

They proved it where it counts. Through EPRI’s DCFlex Initiative in Phoenix, alongside NVIDIA, Oracle, and the Salt River Project utility, Emerald showed a data center could ramp its power down during a grid stress event without wrecking AI workload quality. The follow-on tells you how seriously the ecosystem is taking it. In October 2025, NVIDIA, EPRI, Digital Realty, and PJM lined up with Emerald on a “Power-Flexible AI Factory” reference design and put it into steel at Aurora, a 96 MW Digital Realty build in Manassas, Virginia, opening in the first half of 2026. By CERAWeek in March 2026, the coalition had widened to the supply side: AES, Constellation, Invenergy, NextEra, Nscale, and Vistra signed on to pioneer flexible, hybrid AI factories. With NVIDIA co-designing the product and the grid’s biggest generators line up behind it, it’s a serious signal that Emerald is onto something.

AI workloads were flexed during grid stress while maintaining application performance, demonstrating that software can act as grid infrastructure

Layer 2: the data center problem

Today, compute, cooling, and power are managed as three separate systems. The losses live in that gap, the compute per megawatt i.e. how much productive AI output a facility wrings from each megawatt of contracted power.

In 2026 Phaidra ran cooling agents on production NVIDIA Grace Blackwell clusters with CoreWeave and Applied Digital, cut thermal-spike overshoot by 75-80%, and the agents self-train, pre-learning on a digital twin and then tuning to the live site in hours, not years. Riding that stability, you can raise loop temperatures and hand the recovered power back to compute: on a 1 GW factory, lifting the water from 25°C to 35°C frees roughly 67 MW for IT, about $3.8 billion a year in additional output. The efficiency is already sitting in most facilities. The cross-layer visibility to act on it is what solves for it.

Two companies are building toward that integrated control layer from different doors:

Hammerhead’s ORCA platform (Orchestrated RL Control Agents) coordinates on-site generation, UPS, cooling distribution, racks, and GPUs simultaneously and claims 20–30% more compute output from the same grid allocation, now framed as token throughput rather than raw utilization.

Utilidata’s Karman attacks oversized power infra with resolution: a million samples a second, power-capping in under 20 ms versus ~2 seconds for software-only tools. Fast enough to ride the AI power spikes that slower tools never even see, which lets a facility safely run into the headroom it’s been paying to keep idle. Utilidata’s claim: ~50% more compute on the same nameplate, and every 1 MW of unused budget left on the table is north of $20M a year in stranded revenue.

Millisecond visibility allows operators to safely utilize power headroom that conventional monitoring misses

What I don’t know (and where I’m betting anyway)

• How much capacity can actually be unlocked and who is incentivized to unlock it?
  The recovery rate and the adoption path remain uncertain. The most compelling efficiency gains come from highly optimized environments, making it unclear how much translates to the open market with different stakeholders. My bet: the opportunity is large enough to matter, but adoption starts where incentive, control, and urgency converge.

• Where does the value land?
  The split between vendor, operator, and customer is unsettled, and gain-share just trades the budget objection for a measurement war over the counterfactual. My bet: whoever nails trust/verification wins the layer.

• Can a utility-facing business be venture-scale?
  The grid-facility seam means slow, regulated buyers, long cycles, and glacial procurement. But GridCARE’s $64M and Emerald’s $68M in sixteen months suggest the capital markets are starting to bet yes.

• Does this seam stay a startup’s to own or get absorbed?
  As hyperscalers internalize it, Schneider and Vertiv bundle it, and NVIDIA folds it into the platform? My bet: the optimizer commoditizes, but the trusted cross-party verification layer stays independent. That’s the seam worth owning.

Part 2: now light the whole network

Strip everything above to its skeleton and you get one sequence: visibility → measurement → optimization → utilization → speed-to-power.

GridCARE, Emerald, PADO, and Hammerhead look like four companies solving four problems at different layers. I’m increasingly convinced they’re all responding to the same realization: significant capacity already exists inside infrastructure we’ve already built, and the bottleneck to reaching it is software.

What I find the most interesting layer about to emerge is the control plane sitting between power, cooling, and compute inside a single facility, and how it eventually stretches across a network of facilities. As inference scatters into dozens, then hundreds, of regional deployments, the problem flips from one facility run well to many facilities coordinated intelligently. Compute and energy stop looking like separate operating decisions made site by site and start looking like a single portfolio to optimize. Tokens per watt as a fleet metric, not a facility metric becomes the number that runs the whole thing. That’s Part 2.

If you’re operating infrastructure in this space, building at any of these layers, or thinking about where to allocate capital, I’d love to compare notes. I’m also keen to build in the space and am actively exploring operating roles. If you’re working on a problem where you think I could be useful, I’d love to connect.

We’ve teamed up with writer, editor, and thought leadership strategist Katie Gilbert on something a lot of you have asked for: a real method for turning the climate ideas in your head into writing & sharing that lands.

Thought Leadership for Humans is a four-week program inside Climate Drift, built for people who have something worth saying and want help saying it well.

If you’ve seen the full six-week version of this program, this is its lighter sibling. Plenty of you told us the longer one looked great but asked more time or budget than you had right now. So we made a shorter version: same community, same Katie, lower price.

The lighter touch shows up in a few places. Fewer live calls (still a few, because cohort time is the best part), and the lessons run on a more self-guided schedule, with Katie in the community to answer questions and give strategic and editorial feedback.

The July cohort runs July 6-31 for $225.

Apply Now

Spots are limited. Apply by Friday, July 3: https://tally.so/r/68eJDJ

This is a structured process for developing a clear, honest climate voice and a plan for using it. Katie’s approach starts from your ideas and the change you want to see, then works outward to how you say it.

What’s included:

• Live teaching call with Katie
• Show-and-tell cohort call
• Live guest expert session with Q&A
• Self-guided audio lessons, worksheets, and curated recordings from cohort 1
• A private community space for sharing drafts, ideas, and feedback
• Personal, line-by-line feedback from Katie on your writing

Cohort 1 included the co-founder of a circularity nonprofit, climate-tech founders and small-business owners, a researcher at a leading climate tech accelerator, and climate-focused investors. The common thread: real expertise, and a need for structure and support to get it out into the world.

One graduate told us: “It’s hard to overstate how meaningful this experience was. I zeroed in on my project in a way that thrills me.”

Curious what past participants built? Read their stories:

Climate Drift

Your voice is load-bearing infrastructure

👋 Welcome to Climate Drift: your cheat-sheet to climate. Each edition breaks down real solutions, hard numbers, and career moves for operators, founders, and investors who want impact. For more: Community | Accelerator | Open Climate Firesides | Deep Dives…

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3 months ago · 9 likes · Skander Garroum and Katie Gilbert

Climate Drift

When thought leadership isn’t all about you

👋 Welcome to Climate Drift: your cheat-sheet to climate. Each edition breaks down real solutions, hard numbers, and career moves for operators, founders, and investors who want impact. For more: Community | Accelerator | Open Climate Firesides | Deep Dives…

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4 months ago · 9 likes · 3 comments · Skander Garroum and Katie Gilbert

Climate Drift

Your visibility gap is costing the climate

👋 Welcome to Climate Drift: your cheat-sheet to climate. Each edition breaks down real solutions, hard numbers, and career moves for operators, founders, and investors who want impact. For more: Community | Accelerator | Open Climate Firesides | Deep Dives…

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4 months ago · 12 likes · 1 comment · Kruthika Eswaran

Questions? Book a call with Katie at https://calendly.com/katiegilbert/tl4h-applicant-call or email her at katie.elizabeth.gilbert@gmail.com

The standard story about alternative protein is that demand fell short. True, but incomplete.

Scott Renda spent 11 years at AWS watching primitives, public pricing, and pay-as-you-go turn cloud computing into something a lender could underwrite. Now he’s pointing that same lens at fermented protein, and the diagnosis is uncomfortable.

Renda’s argument is that the deeper bottleneck is financial: fermentation capacity can’t be priced, compared, or underwritten the way infrastructure assets are in mature sectors. There’s no shipping container for a liter of bioreactor time. Most CDMOs run a “contact us” model, contracts hide pricing inside private MSAs, and a lender staring at one signed number learns what one buyer paid, not what the next vessel earns.

His proposed fix, the “Protein Fabric,” is three moves in parallel: define the standardized units of work, post the prices publicly, and offer more than one way to buy. He then runs a repeatable method across all three production stages (feedstock and strain, fermentation, downstream processing) to actually pick the primitives, and builds a working rate card to show what it looks like priced.

It’s a technical and deliberately falsifiable piece. Scott Renda is new to the space and says so repeatedly, inviting you to tell him where he’s wrong.

Proof him wrong, or fix alternative protein with him.

🌊 Let’s dive in

1. Intro

Picture a steel box, eight feet wide, stacked ten high on a ship the length of four football fields, so familiar it no longer registers as special. Yet those boxes reoriented the global economy. Before the shipping container, moving goods across oceans was a custom nightmare of barrels, crates, and prices quoted dock by dock. By standardizing the unit of work, the maritime industry made the infrastructure legible enough that trade could finally scale, and the capital to build it could finally be raised.

Right now, fermented proteins (precision, biomass) are stuck before their own shipping container moment. Many people know fermentation makes food staples like bread, beer, and cheese: a living thing like yeast, bacteria, or fungi feeds on simple ingredients and turns them into something new. Far fewer know the same process, targeted at a specific protein, can make egg and meat proteins, grow protein-rich biomass like mycoprotein, or produce dairy’s whey and casein found, without the cow.

In the first part of this decade, startups such as Meati, Beyond Meat, Perfect Day, and Believer Meats¹ chose to build their own facilities, owning their destiny rather than relying on tolling suppliers or food-grade Contract Development and Manufacturing Organizations (CDMOs). Then consumer demand for alternative proteins fell well short of expectations, breaking two things: the companies that built their own infrastructure couldn’t reach the scale that drives unit-economic improvement, and the capital that could have funded shared, multi-tenant capacity (third party) never materially showed up.

Breaking through this wall is the thesis Liberation Bioindustries³ was founded on and why they are commissioning a 600K-liter facility this year in Indiana. But a pioneer facility cannot carry an entire industry, especially when the commercial-scale capacity startups want today would have been financed and commissioned in 2021-2024, when venture capital was flowing easily.

Table 1: US Fermentation Capacity Gap | Dairy Protein

Validating more multi-tenant capacity is essential for fermented proteins. Why? In 2023, GFI identified⁴ 5.4M liters (L) of food-specific fermentation capacity in North America, of which only 1.8M L was for CDMO/CMOs. The rest was attributed to companies serving their own needs. We conservatively estimate that by EOY27, total capacity will be 6.6M L, inclusive of pre-announced facilities.⁵ At current titer, recovery, and utilization levels, the sector would need to expand roughly 50x (Table 1) to displace even a modest 5% wedge of the US fluid-milk sector.⁶ Hitting the industry’s cost-competitive efficiency targets shrinks that to 6x against total capacity. That reduction is the productivity gap repetitions close, and the flywheel this paper argues legibility funds. Absent forcing functions, getting more CDMO capacity built is a binding constraint. See Appendix A for assumptions.

Table 1: US Fermentation Capacity Gap | Dairy Protein

Pull the levers yourself. Close the gap.

The 2026 Global Food Institute State of Fermentation report⁷ is measured in tone, leading with regulatory wins, new facilities, and precision fermentation’s growing share of sector funding. Read through a bankability lens though, it describes a doom loop with no obvious exit. High production costs force premium pricing. Premium pricing suppresses demand. Suppressed demand prevents the scale needed to build bankable infrastructure. Without bankable infrastructure, unit economics stay high.

The reflexive answer: go asset-light, partner with CPGs, lock in offtake, and prove demand. But taste or perception aren’t the only things to solve. The path also needs more CDMOs, more rentable capacity, more repetitions. More of the right infrastructure, not less.

2. Breaking the Doom Loop

I am new to this space and writing in public because the argument or conclusions may be wrong. If you want to argue back, the form is here.

This paper argues the bottleneck in alternative protein isn’t just biology, and it isn’t that demand is missing. It’s that capacity can’t be priced into the bankable offtake that demand could become. That’s a problem of financial legibility. The industry has not yet defined standardized units of work, which invites opaque pricing and discourages pricing-model optionality. That prevents capacity in its current form, the liters of bioreactor and DSP train time that fermentation-protein companies rent, from being priced, compared, or underwritten the way infrastructure assets are in mature sectors. The CDMO capacity that does exist is largely single-tenant, making it harder to re-market when a contract lapses, so even built liters carry less of the resale value capital underwrites against.

For precision fermentation to win, the industry has to name what it sells, show what it costs, and offer more than one way to buy it. Done precisely, a CDMO can aggregate a fragmented long tail of buyers, on-demand and prepaid alike, into the contracted offtake capital underwrites. Legibility sits upstream of supply: it is how more multi-tenant capacity gets built and provides a structure that bends the cost curve for anchor customer and startup alike. This financing gap isn’t structural. The conditions blocking the capital are specific and addressable, and a CDMO willing to build differently can remove them.

There is an intervention that can break this doom loop. The alternative protein industry needs to pursue three things in parallel: defined primitives, public pricing, and pricing-model variability. I call this bundle the Protein Fabric. The rest of this paper turns it into a framework: a method to generate and choose primitives across three stages of precision fermentation production, feedstock and strain engineering, fermentation, and DSP, then a way to meter, price, and sell those units of work. To bring it to life, we’ll also illustrate how Protein Fabric would surface publicly via a CDMO pricing prototype.

This framework is repeatable; practitioners in other infrastructure sectors can run this methodology for their production processes. To be clear, the paper does not claim primitives or public pricing magically solve taste or unlock debt capital. They won’t. Instead, read this as one viable and durable approach to introduce financial legibility, and get the fermentation flywheel spinning.

3. Protein Fabric Framework

Power, commodity chemicals, cloud, semiconductors, even the US Postal Service. Each one arrived at the same realization before it could scale, that it needed primitives, pricing transparency and pricing-model variability. Precision and biomass fermentation are next.

Primitives: A primitive is the smallest unit of something that retains meaning on its own and can be combined with others without losing meaning. A common set of underlying criteria are below. Primitives:

Atomic: Cannot be subdivided further within a domain;

Composable: Can be combined with other primitives to form larger structures or abstractions.

Distinct: Do not overlap with each other; they are unique dimensions of a domain.

Durable: Persist over time, making them stable to build upon.

Context-Independent: Core behavior does not change depending on what the primitive is paired with.

When primitives are defined, complexity decomposes: downstream actions become specifiable, risk attributable, and comparisons become possible. Primitives are not just capacity; some are events, measurements, units, or states others rely on. They can be bundled, abstracted, or transferred between parties. Without them, everything stays custom. Each transaction renegotiates units of work, comparisons fail, and sales conversations reinvent vocabulary that should be consistent.

Primitives emerge when standardization yields more benefit to the industry than any one party can capture alone. Once named the examples are obvious, the shipping container, the kilowatt-hour, the rail gauge, the postage class. Fermentation has no publicly defined primitive set where money flows, though, as we’ll see, it does have unlabeled examples.

Public Pricing: One of the most mundane and powerful moves a business can make is to publish its pricing. What matters commercially is pricing any buyer can see without a sales call, whether a consumer, a business, or an agent, attached to a unit of work (a primitive) that performs consistently across customers. The unit is named, the value declared, the meter consistent, and a web search or API call returns the same number for a like query, regardless of who is asking.⁸

When pricing becomes public, buyers model costs independently and lenders gain a curve to underwrite against. An MSA gives one buyer a private number after signing; it gives the market no curve and a lender nothing to compare. Public pricing also forces line items to be defended or removed, where opacity lets undefended margin survive. That is why the public path, not only private negotiation, scales the sector.

Pricing-Model Variability: It’s important not to confuse a pricing dimension (what you buy) with a pricing model (how you pay). Today, CDMOs bill across any number of dimensions, including fee for service, labor hours, per-batch, per-volume, and wraps them inside take-or-pay inside customized contracts. What’s uncommon is the pricing-model diversity that industries with primitives rely on. Different models can serve different buyer profiles and produce diverse revenue shapes for sellers. On-demand revenue is spiky and episodic, and it serves a long tail of use cases. Reserved revenue is contracted ahead of time. CDMOs already convert forward intent into contracted revenue through LOIs and MSAs, so commitment isn’t the missing piece. What a lender cannot do is generalize from a single private rate: one signed number says what one buyer paid, not what the next vessel earns. A posted on-demand and reserved curve answers that question; a contract drawer does not. Pricing-model diversity, not transparency alone, is the condition for infrastructure-grade capital.

A research scan of 100+ suppliers⁹ from GFI’s database¹⁰ revealed three themes. Some private CDMOs name a flexible pricing model but attach no number (campaigning and pay-per-kilogram / take-or-pay at Liberation). Ginkgo Bioworks, the closest thing to an “AWS of biology,” posts some public per-unit prices but at a different layer (assays and expression, not fermentation capacity). Publicly-funded university facilities post rate cards (Cornell, Alberta, AURI), but priced on conventional axes of labor, per-test fee, facility-time, or cost-share. The majority of U.S. providers follow a “contact us” model. Thus, examples of the pieces exist, but have never been assembled as Protein Fabric envisions. The consequence cascades. Seed-stage, B-round, and enterprises: few can model COGS reliably, and lenders can’t underwrite throughput against prices they can’t see. When the conventional wisdom is that techno-economic analyses are too optimistic, that’s powerful. The TEAs aren’t wrong because smart people aren’t modeling. They’re wrong because the inputs and assumptions are private.

4. AWS as an Illustration

With the Protein Fabric established, it’s worth looking at one company that built a wholly new business on a similar foundation.[1] What follows is an illustration, not a precedent. Fermentation is not software, but the commercial architecture is portable.

AWS launched in 2006 with S3 (storage), soon followed by EC2 (compute). It passes every primitive criterion: atomic, composable, distinct, durable (customers today still use the original API), and context-independent. The launch press¹¹ release described S3 as “a simple storage service... at very low costs,” posted the price ($0.15/GB-month stored, $0.20/GB transferred), and set no minimum fee. Developers paid only for what they used. The primitive, public price, and pay-as-you-go model went live simultaneously, no sales conversation required. This broke how incumbents had sold enterprise IT for decades. Multi-year agreements, sales cycles measured in quarters, and hidden scaling costs. Incumbents spent the next decade reacting to AWS, whose customers didn’t have to call sales.

That was the start. As customers built on S3 and EC2, they asked for purchasing models beyond on-demand. EC2 Reserved Instances¹² followed: a 1- or 3-year commitment for 30-60% off on-demand, giving CFOs a way to budget predictable cloud spend, while Spot instances offered steeper discounts to customers whose workloads could tolerate interruption. RIs also buffered AWS’s own revenue against customer spikiness and became a capacity-management tool. The pricing model wasn’t just a customer feature; it was the mechanism that made AWS scalable. The same primitive (an EC2 instance) was sold across multiple pricing models to three buyer profiles, without breaking the unit.

None of this was inevitable. At each step there were debates, including competitive reaction to public prices and whether new products would cannibalize revenue. The commercial architecture wasn’t designed up front. It was built iteratively with customers on top of extensible primitives and public pricing.

What follows is the precision and biomass fermentation version of that catalog.

5. From Candidates to Primitives

The first four sections made the case for Protein Fabric. What none of those sections did was explain how to actually pick primitives. That is the job of this section: a repeatable method any fermentation operator can run on their own to generate, qualify, and select the units of work the business will commit to.

To bring the Protein Fabric to life, let’s introduce two fictional entities: Otto, a food-grade CDMO selling precision/biomass fermentation services and Container Bio, a precision fermentation startup with a target protein looking for a CDMO to validate their approach. We’ll refer to both throughout.

Tenets: Defining what a primitive is does not tell you which primitives to choose. The selection mechanism is a set of tenets applied to each qualified candidate. Tenets are tiebreakers: precise enough to settle a question on their own, durable enough to last as the product changes. The tenets below are Otto’s. Another operator running this method should write their own.

Fermentation Primitive Tenets:

Zone of Control: Primitives are always within Otto’s control, something Otto can commit to and be held at the boundary it owns.

Deliverability: Otto commits to the envelope, not the result that emerges from it. A biological outcome co-produced with the customer’s strain cannot be solely attributed to either party after the fact, so it is not a primitive.

Attributability: Otto’s primitives make the failure boundary self-evident.

Portability: Otto’s primitive must survive domain translation. A primitive must mean the same thing as you vary feedstock, DSP trains, or organisms. Where the physics differs, the difference shows up as a variant of the primitive, not a new primitive.

Measurable: Otto’s primitives must be metered unambiguously at the point of delivery.

Running the Method: The procedure that applies the criteria and tenets to select primitives runs in four steps: 1/Decompose → 2/Classify → 3/Filter → 4/Reconstruct.

Step 1 (Decompose): This step generates a raw inventory of what units of work exist. Break the product or capability down from first principles. The generators you use depend on your lens: a commercial view (what already gets invoiced), a science view, persistent states and ownership boundaries, or process steps are all good starting points. Whatever generators you pick, add one pass no single lens provides: a sanity check that walks the draft inventory against varied conditions, different inputs, hosts, or equipment, to catch the units a single example would miss.

Step 2 (Classify): Now take this blob of ideas and generate 4-5 labels, one of which is ‘primitive’. This adds structure to your inventory via tags, but does not remove items. Every label except primitive is disposable. Tags are assumptions, not gates.

Table 2 | The Method

Step 3 (Filter): There are two filter passes, done in order. First, determine if each primitive candidate satisfies all of the qualification criteria. Then take those that pass and apply the selection tenets. This is where narrowing starts. Expect surprises and imposters: candidates that look like primitives but turn out otherwise.

Step 4 (Reconstruct): The final step inverts the decomposition. Working backward from each surviving primitive to the source material from Step 1, confirm it traces to a real unit of work. A primitive that traces to nothing is a phantom and gets cut. The output is a clean set of primitives and their sub-types (e.g., soda: cherry, orange, plain).

The next few sections run the method across all three fermentation production stages. They are the proof that it ports, and they are where to go deep dive into primitive choices. A reader who wants the commercial payoff can jump to Section 10; the result is the same primitive set, now priced.

6. Feedstock and Strain Primitives

The feedstock and strain engineering stages perform four main functions: identify and validate an organism capable of industrial-scale expression; bank that organism as a stable, genetically consistent asset; engineer and optimize carbon and nutrient streams specific to that organism’s metabolism; and transfer the validated inoculum (starter) to a fermentation vessel at a declared specification.

Step 1 (Decompose). For Otto, we generate the inventory from the commercial lens where money already flows: the invoice Container Bio would get from Otto, the unpriced costs Otto absorbs or provides for free, and the sanity-check pass from Section 5, run here across different organism/feedstock pairings to confirm candidates hold up beyond a single host. With these inputs, we identified 18 candidates, among them media sterilization, in-run supplementation, strain qualification, the carbon substrate itself, and cell bank storage.¹³ A note on sourcing. Otto is fictional, so there is no invoice to point at. Instead, Otto’s invoice is synthesized from publicly available information on food-grade CDMOs.¹⁴ These buckets are mine, and I treat them as a defensible starting point, not ground truth.

Steps 2 through 4 (Classify, Filter, Reconstruct). We classified the 18 candidates, filtered them against the criteria and then the tenets, and reconstructed the survivors back to cost inputs without gaps or duplicates, yielding a final list of six primitives (Table 3). The eliminations worth walking are the ones that taught the framework something, and they follow below. One important learning concerns primitive “sub-types.” A sub-type is not a new primitive. It is the same primitive with a variant, akin to a cloud customer picking a different GPU type for inference versus training: both are compute, not a new primitive. Where a primitive has “sub-types”, visible in the variant column, they are split by an infrastructure dimension Otto configures differently, not biological taxonomy. Inoculum Preparation splits by propagation regime (single-substrate, induction-switch, filamentous-morphology) because a methanol-fed Pichia and a molasses-fed S. cerevisiae are both yeast, but demand different seed-train infrastructure, hence different sub-types.

Take Tech Transfer, a common part of contract manufacturing agreements. The Tech Transfer process (and package) is how Otto gets a customer’s strain qualified and run through their infrastructure. It passes three of the five criteria (distinct, durable, atomic) but fails composability: it has constituent parts Otto already meters separately, a qualified strain, labor, and vessel time for runs. It is not a fourth thing alongside them; it is a project wrapper around the other three. So when a lender asks how much Tech Transfer revenue is strain readiness vs. facility time vs. expert hours, the answer shifts, because the underlying primitives are collapsed and cannot be repriced when the mix changes.

Now, we focus on a survivor, the Qualified Strain, the clearest case of a primitive that is a state rather than an action. Qualification work happens per strain (characterization, robustness, release panel, filed dossier) and the qualified state persists. Every campaign after the first reads from it: Inoculum Preparation inherits temperature bands and shear limits; Lot Quality Gate inherits identity panels and release specs; and Cell Bank Custody references the characterization baseline. Without Qualified Strain, each would re-contract the biology on every batch. A project has start and end dates. A qualified strain has neither, just a record other primitives read from. How Otto meters that state, a project fee, a per-event charge, is its commercial choice, not a fact of the biology, which is the lever Section 10 pulls.

In the next few sections, we show how fermentation and DSP primitives are harder tests: capital intensity is higher, sub-type proliferation spikes, and the organism classes Otto supports create more pressure on the infrastructure-not-biology cut.

7. Fermentation Primitives

Fermentation is where the framework meets things that are scheduled, capitalized, and real but still not primitives. A run is a sequence of steps: sterilize the vessel, inoculate, hold a controlled envelope (temperature, dissolved oxygen, pH, agitation), then harvest. Each step is infrastructure Otto maintains at the vessel boundary, the scaffolding around a variable biological core.

We run the same four-step method; decomposing this stage from first principles starts with a more robust set of 21¹⁵ candidates, the ones a CDMO operator would list if asked what they actually sell time on. After classify, filter, and reconstruct, five fermentation-specific primitives survive. Several recurring lines here are not fermentation primitives at all, among them an offline assay and a utility draw; because they reappear in multiple stages. We collect them in the Shared Meters section. The rest of this section walks three eliminations that taught the framework, plus the survivor we initially missed.

The first candidate to stress the framework is the seed train, where vessels of progressive sizes (2L -> 20L -> 200L -> …) scale biomass up to production size before the main vessel is inoculated. My hypothesis is that CDMOs will want this as a primitive: seed capacity is scheduled, utilized, and constrained; customers must wait for it. Yet, it’s not a primitive. Seed train is several existing primitives bundled (vessel hours + media + a starter culture). The output is qualified inoculum, which is already a primitive in the Feedstock/Strain section. A seed train isn’t a new primitive; it’s additional usage of an existing primitive.

The second stressor groups candidates which are run-time actions: fed-batch carbon additions, nutrient top-ups, and additives like antifoam and pH trim. These happen inside the vessel, during the run, on the CDMO’s watch, thus, they feel natural as primitive. But these fail the non-uniqueness criteria; we already see these as existing primitives in the Feedstock/Strain section. A fed-batch carbon addition is the carbon feed delivery meter firing. Nutrient, antifoam, and pH trim additions relate to the media package primitive being used again. Nothing about them changes because they occur at a different production stage. A primitive exists once; without that prior-existence check, you double-count what the customer already pays for.

The third anti-pattern relates to the canonical metrics of a fermentation run. These are: growth rate (μ) plus titer, rate/productivity, and yield (TRY). Originally, we thought at least titer would survive. However, the Zone of Control and Deliverability tenets draw the line; Otto delivers the infrastructure and is held to it, but does not absorb what the customer’s biology controls. Otto’s kLa, feed execution, and scale-down model shape titer, but influence is not ownership. Run two strains in the same held envelope and they reach different titers; the difference belongs to the customer’s strain, media, and process, not the vessel. That is why titer is reportable, not committable: the envelope can be priced, the outcome should not. Today, CDMOs run per-batch pricing, quoted against a declared titer assumption, and when the strain underperforms, the customer’s per-gram cost rises. Stating the boundary this way codifies existing practice rather than imposing a new one.

The candidate that taught the most is the one we almost dropped: vessel turnaround, the clean-in-place (CIP) cycle that returns a fouled vessel to a clean, ready-to-sterilize baseline for the next customer. It stops at that clean baseline; the steam-in-place (SIP) cycle that takes the vessel from clean to sterile is a separate sterilization event. In a single-tenant frame turnaround is invisible overhead, folded into vessel-hour economics. Multi-tenancy is what surfaces it: the cost of switching from one product to the next varies with how different they are, a same-product reset is a short CIP while a switch across organism classes demands cleaning to a validated threshold and re-qualification, and that cost should fall on whoever triggers it. It is atomic, composable, distinct, and squarely in Otto’s Zone of Control, since unlike a failed batch it needs no customer arbitration. Pricing it is what makes shared capacity financeable.

Finally, vessel-hour teaches something else. A vessel-hour isn’t a single thing. A 2L bench vessel and a 150,000L production vessel both bill “vessel-hours” at prices differing by orders of magnitude, fermentation mode, organism class, and performance tier. It is a family, not a single rate; how a CDMO prices it comes later.

Five fermentation primitives remain, each owning one transition with no overlap into the next: turnaround cleans, sterilization sterilizes, inoculation starts, harvest ends, and vessel-hour is the capacity state they all sit inside, itself a family rather than a single rate, varying by scale, fermentation mode, organism class, and performance tier.

8. DSP Primitives

Downstream processing is where the broth that leaves the fermenter becomes product. It moves through a sequence of operations: separating cells from liquid (or rupturing if intracellular), removing debris, capturing target proteins, polishing, sterilizing, and in some campaigns, filling into containers. DSP campaigns are heavily impacted by fermentation TRY outcomes. If TRY lands below target, the DSP sequence remains, but each step carries a “TRY tax”, i.e., longer durations to reach the same yield, additional filtration passes, extra polish, and so on.

My first instinct was to build primitives based on DSP stages, clarification, capture, et al., since each one feels like a unit of work. They aren’t. A stage is a position in the sequence, not a kind of work. Take filtration, it recurs in clarification, in polishing, in concentration, and in the sterile step. If stages were primitives, that one operation would fracture into four. Instead it is a single primitive with sub-types that differ by physics (depth, TFF, nanofiltration, sterile), not by where they sit in the run. Unlike fermentation which is a process you judge by an aggregate outcome (TRY), DSP breaks at the edges between operations, where each one has discrete inputs, outputs, and pass/fail criteria. Those edges are where the work actually divides, and cutting on them lets each primitive answer to its own physics.

We run the same method again, this time starting with 26 candidates.¹⁶ As before, several candidates fall away at the first filter, the qualification criteria, which ask whether a thing is even a clean, standalone building block. The surprise came at the second filter. The selection tenets, the rules that decide whether a building block is something Otto can actually stand behind and put a price on, dropped nothing.

That was puzzling, until the reason became clear. In fermentation, that second filter does real work, because the outcome of biology is never fully in the provider’s control. DSP is a different animal. Here chemistry and physics do the work: pumps, filters, columns, dryers, each with a defined input, a defined output, and a clear pass or fail. The unpredictable part, the biology, happened upstream in the fermenter. By the time material reaches downstream processing, no candidate shows up as a biological-outcome question, so none of them trip the tenet built to catch one. Of the original 26 candidates, eight survive (Table 5).

9. Shared Meters

The cut between a primitive and a shared meter is ownership of work. Three items recur across the framework without belonging to any single stage: parts of each stage merely draws down the same input, that is a shared meter, declared once and invoked anywhere. Utility charges (e.g., electricity, steam, water) span every stage that powers equipment. An Assay Unit (AU) is a measurement producing an answer the customer can act on, so a fermentation titer check and a DSP release test are the same meter measuring different actions. A Consumable Consumption Unit (CCU) is a normalized unit of pass-through: undifferentiated material Otto buys and passes through with an uplift.

Across three stages we identified 19 primitives and three shared meters, a reasonable set for mapping a whole CDMO’s business. One tip for teams newer to primitives: most over-classify at first and resist cutting. When in doubt, cut. The north star is the smallest set that runs your business at a high bar.

10. Pricing

Section 3 argued that public pricing and pricing-model variability matter. Public pricing makes the unit visible; variability makes that same unit sellable in different revenue shapes, so a lender can underwrite against a reserved floor instead of trusting a private model. Neither guarantees demand. What they do though is lessen uncertainty, the precondition.

We argue pay-as-you-go (PAYG) is the right starting point for fermentation primitive pricing. PAYG should not be confused with “cheapest.” Its power is that it removes friction other models impose: a reservation needs a forecast and a commitment, while PAYG needs a rate, meter, and payment method. A buyer can transact before any relationship exists. It also becomes the reference other models key off, since discounts are expressed against the on-demand rate. PAYG is also purpose fit for a buyer that isn’t ready to forecast or who needs a pilot to understand where first titer lands.

Reservations and commitments come next, each serving a buyer behavior PAYG does not. The below are illustrative; a real CDMO would tune them to its own equipment, product mix, and financial goals.

• Reserved Capacity. A slotting fee for a specific vessel scale over a fixed term, paid regardless of utilization, in exchange for a discount off the on-demand rate. It also includes pre-payment options, which serve as a credit mechanism. A prepaid or escrowed reservation is bankable independent of the buyer’s credit because cash is in hand, while a no-upfront one is only as good as the counterparty. A CDMO wanting its reserved book to count as a financeable floor prices the upfront variants to pull buyers toward prepayment.

• Floating DSP Discount. Customers commit a dollar amount per unit of time, and the discount applies across DSP train types rather than a single asset. This separates the financial instrument (the commitment) from the capacity instrument (the equipment). A customer whose process shifts from centrifugation to filtration keeps the discount.

• Assay Unit Volume Tiering. Banded pricing, falling as monthly campaign volumes rise. The band prices pass back a decline in the CDMO’s average (fully-loaded) cost per assay, the fixed instrument amortized across more samples and higher utilization.

• Media Package Reservation. Applied to supply- or price-constrained inputs (e.g., biotin, specialty nitrogen sources, food-grade dextrose, ammonia). A customer reserves supply and consumption meters at a fixed rate, converting uncertainty into a priced commitment.

• Contingent capacity. A variable discount on idle capacity or near-expired inventory, offered for non-critical development or pilot runs that can tolerate the terms.

A mixed book turns one asset into several products: reserved and floating commitments contract revenue ahead of use, tiering and contingent capacity monetize idle time, and the demand signal lowers the cost of capital. For the customer it means matching commitment to confidence and running experiments a project-fee quote would kill.

11. Pushback

It’s worth making the flywheel explicit, as the title promises. Posted primitives and varied pricing models widen the funnel, and that granular demand fills the troughs anchor-only customers leave when they depart. Utilization is repetitions, and repetitions bend the cost curve. As it bends, the delivered price falls toward what a CPG off-taker can consider, that contracted offtake is what capital underwrites, and cheaper capital aids facility expansion. Each turn happens without renegotiating the unit of work from scratch. Protein Fabric makes a claim about how fermentation services should be priced and sold. The honest test of a claim is its falsifier, so what would have to be true for this one to fail?

The first objection says standardization isn’t necessary to attract capital. Venture and debt already fund fermentation, and a toll road gets financed without a primitive. That’s fair: a lender underwrites contracted cash flows, counterparty credit, and recovery value, not a public rate card. But that locates the real work. Two questions hide inside “is it financeable?” Can a lender underwrite construction debt, which needs contracted, creditworthy offtake, and can the CDMO get the utilization to drive unit economics? The toll road answers the first. The doom loop lives in the second, where a CPG won’t sign until prices drops and the prices won’t drop without repetitions. That second job is legibility’s, and it sits upstream of supply. Posted primitives and varied pricing models let a CDMO fill a vessel from a long(er) tail and a reserved mid-market alongside anchors, and that contracted offtake is what capital underwrites, not the rate card.

The fair pushback is that a reservation from a pre-revenue startup is a soft promise. Two things make it collateral: prepaid reservations are bankable regardless of credit because the cash is in hand, and a standardized unit is resellable, so a defaulted slot resells into the same curve and a failed platform leaves the lender a standard asset rather than a stranded single-product line. Initial funding is likely equity, grants, or anchor money, not project debt, so I’m not claiming a rate card raises construction debt; I’m claiming it manufactures the offtake that does. What would prove me wrong? If shared capacity gets financed like a single toll road, one asset, one investment-grade off-taker, take-or-pay, no posted prices, and the industry massively scales, then legibility was never a blocker.

The second objection, in its sharpest CFO form, is that posting prices first is unilateral disarmament. It anchors every prospect, loses customers that quietly opt out, and invites undercutting. The standardization benefits accrue to the industry while exposure falls on the first mover. The conclusion is backwards. Transparency is a one-way door, so the trap isn’t going first; it’s being third or fourth after a competitor posts, defines the units everyone compares on, and routes the inbound funnel to itself. Going first sets the market, the standard becomes yours, and competition moves up the stack to reservations, reliability, and support. What would prove me wrong: a credible operator posts, durably loses share to opaque incumbents, and no one follows. I think the opposite occurs.

The third objection may be the strongest: alternative proteins are not yet comparable to conventional peers on taste or price, and no amount of capital legibility changes that. I can’t argue otherwise. Legibility does not fix demand. It does stop the sector from mistaking “willing to try” for “willing to buy.” Honest primitives feed more accurate TEAs, so capital gets deployed against real unit economics instead of inflated ones, and demand signals get priced correctly. That is a benefit, not a cure. Now, if demand never materializes at prices rivaling conventional proteins, then the sector isn’t durable as a business.

12. Conclusion

The intervention this paper proposes is repeatable. Decompose a production process into standardized primitives, then make them legible to capital: named and metered, priced in public, and buy-able in more than one shape. The method ports to any infrastructure sector, not just fermentation.

Applied here, it yields a primitive set across feedstock and strain, fermentation, and DSP, plus shared meters across. Made public and priced across models, those primitives turn opaque capacity into something a lender can underwrite and a buyer can model. Legibility first, capital after, a market that can compare, aggregate, and finance rather than renegotiate every transaction from scratch.

A caveat: I am new to this space, and I am writing in public because the argument may be wrong. The primitive choices could be wrong, the pricing models impractical, biological randomness enough to blunt the whole thing. This is a proposed path, not a guaranteed blueprint. If you think I’ve got something wrong, this short form is where to tell me.

Appendix A – Methodological Notes & Model Assumptions

1. Macro Market Baselines & Conversions

· US Fluid Milk Footprint: Total baseline volume is established at 43.2B lbs, utilizing the 2024 USDA Economic Research Service (ERS) preliminary dairy summary data for fluid milk products.

· Mass Normalization: To maintain cross-commodity analytical parity, imperial measurements are converted to metric utilizing a standard factor:

43,200,000,000 lbs × 0.453592 kg/lb = 19,595,171,700 kg

· Target Market Wedge: The model targets a 5% displacement of fluid volume (979,758,585 kg of milk equivalent) as an initial, market-entry penetration vector for precision fermentation adoption.

2. Protein Concentration & Mass Balances

· Dairy Protein Density: Pure whole milk is modeled at an average structural protein concentration of 3.4% by weight (representing a composite baseline of caseins and whey proteins, such as β-lactoglobulin).

· Total Target Output: The net mass of pure, dry protein required to substitute the 5% fluid milk wedge is calculated as:

979,758,585 kg × 0.034 = 33,311,792 kg

3. Bioprocess Engineering & Annual Yield Model

· Upstream Fermentation Titer: Today the model uses roughly 10 g/L (0.010 kg/L), the hero value for demonstrated secreted food-protein titers (Nielsen et al., 2024), against a demonstrated fleet nearer 5 g/L. The mature case uses 51 g/L (0.051 kg/L), the cost-viability target that same literature states, not a current fleet value. Both apply to hyper-expressing filamentous fungi (Trichoderma reesei) or methylotrophic yeast (Pichia pastoris) platforms before extraction.

· Downstream Processing (DSP) Efficiency: A 75% net DSP recovery efficiency is applied in both regimes, avoiding the error of assuming 100% recovery. This accounts for unavoidable mechanical, purification, and crystallization mass losses across industrial separation trains (e.g., disc-stack centrifugation, ultrafiltration, and spray drying) while preserving core ingredient functionality.

Net recovered protein per batch: Today 0.010 kg/L × 0.75 = 0.0075 kg/L/batch; Mature 0.051 kg/L × 0.75 = 0.03825 kg/L/batch.

· Annual Facility Utilization: The model assumes 13 complete batch cycles per vessel-year today, against frequent changeover and unplanned downtime, rising to 22 at maturity with short repeated turnaround. The mature cadence reflects an average cycle near 7 days: a 90 to 120 hour fed-batch run, then 36 to 48 hours for harvest draw-down, CIP, and the separate SIP sterilization cycle, with headroom for annual mechanical maintenance, contamination events, and downstream bottleneck idling.

4. Volumetric Capacity and Growth Factors

• Net Volumetric Productivity Yield. Annual net yield equals titer times downstream recovery times batches per year. We carry both regimes through the math, not just the mature target.

Today: 10 g/L titer × 75% recovery = 0.0075 kg/L per batch; × 13 batches/year ≈ 0.10 kg/L/year.

Mature: 51 g/L titer × 75% recovery = 0.03825 kg/L per batch; × 22 batches/year = 0.8415 kg/L/year.

• Total Required Infrastructure Footprint. Displacing the 5% fluid-milk wedge requires 33.3M kg of protein. Dividing by each regime’s annual yield gives the active vessel volume that regime demands:

Today: 33,311,792 kg ÷ 0.10 kg/L/year ≈ 330M L.

Mature: 33,311,792 kg ÷ 0.8415 kg/L/year ≈ 39.6M L.

• Current Infrastructure Baseline. Total active US food-grade fermentation capacity reaches 6.6M L by EOY27: a 5.4M L deconflicted baseline (the 2023 GFI census of North American food-grade capacity across all protein types) plus roughly 1.2M L opened since or explicitly planned through 2026 to 2027. We report against this total capacity, since protein from captive and own-use producers also displaces milk; the rentable multi-tenant subset is the tighter constraint a new entrant faces.

• Resulting Growth Multiplier. Dividing the volume each regime demands by the 6.6M L available gives the multiple:

Today: 330M L ÷ 6.6M L ≈ 50x.

Mature: 39.6M L ÷ 6.6M L ≈ 6x.

Endnotes

[1] Until recently, the author had spent 11+ years at AWS, participated in many debates on primitives, pricing models, and transparency.

[1] https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001655210&type=10-Q, https://agfundernews.com/new-owner-of-meati-insists-brand-poised-for-growth-after-mass-layoffs-staff-say-theres-no-plan-just-a-shutdown-and-silence, https://agfundernews.com/breaking-believer-meats-ceases-operations-but-setback-does-not-mean-cultivated-meat-sector-is-doomed-insists-amps, https://agfundernews.com/exclusive-perfect-day-to-sell-consumer-brands-so-it-can-focus-on-b2b-operations

[2] https://www.nature.com/articles/s41538-024-00291-w; https://www.mckinsey.com/industries/agriculture/our-insights/ingredients-for-the-future-bringing-the-biotech-revolution-to-food

[3] https://www.synbiobeta.com/read/liberation-labs-rebrands-as-liberation-bioindustries-to-reflect-global-biomanufacturing-scale

[4] https://gfi.org/resource/fermentation-manufacturing-capacity-analysis/

[5] Excludes: pharma or other capacity, international (e.g., EU 3.6M/L CDMO capacity), or expansions may come online in 2028+.

[6] Capacity needed equals protein required (33.3M kg: 5% of US fluid milk at 43.2B lbs, 3.4% protein) divided by annual yield per liter (titer × 75% recovery × annual batches), measured against 6.6M L of projected EOY27 capacity. At today’s ~10 g/L titers and ~13 batches/yr (0.10 kg/L/yr) the gap is ~50x; at the 51 g/L viability target and 22 batches/yr (0.84 kg/L/yr) it falls to ~6x.

[7] https://gfi.org/wp-content/uploads/2026/04/GFI-2026-State-of-the-Industry-Fermentation-for-meat-seafood-eggs-dairy-and-ingredients.pdf

[8] An autonomous procurement agent reading a published price evaluates the same primitive against the same meter as a human does

[9] Examples are: Cornell Food Venture Center, Franklin County WMFPC, Alberta Food Centre, AURI, Berkeley ABPDU, BioMADE, Corden BioChem, Liberation Bioindustries, Cell Culture Co, AGC Biologics, 21st.BIO, Ginkgo Bioworks, Tanda, CytoNest, Ecovative.

[10] https://gfi.org/resource/alternative-protein-comp1any-database/

[11] https://press.aboutamazon.com/2006/3/amazon-web-services-launches

[12] https://aws.amazon.com/ec2/pricing/reserved-instances/

[13] Candidates that did not survive include feedstock remediation, strain process development, analytical method transfer, the tech transfer project, and strain-origin deviation investigation. The full inventory with first-principles reasoning is available on request.

[14] Evonik Fermas, Laurus Bio, Arxada, EnviroZyme, ScaleUp Bio

[15] Candidates that did not survive include the seed train, controlled additions such as antifoam and pH trim, online PAT monitoring, off-gas analysis, and TRY (titer, rate, yield). The full inventory is available on request.

[16] Candidates that did not survive include enzymatic and chemical lysis, refolding, DSP tech transfer, bead milling, and expanded bed adsorption. The full inventory is available on request.

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Hey there! 👋
Skander here.

$55 billion across 207 deals. April 2026 reset the ceiling. It more than doubled March’s record and became the biggest month we’ve ever tracked.

Jarek’s latest Follow the Money breaks down where the capital actually went, and the regional splits tell you more than any macro forecast could.

🇺🇸 North America: $6.8B across 48 deals, fewer dollars than Asia or Europe but the sharpest thematic concentration of the month. The U.S. kept buying firm, dispatchable power and hard-to-abate decarbonization. X-energy priced a $1B Nasdaq IPO above range (the first large advanced-nuclear listing of the cycle), Blue Energy raised $380M for prefabricated reactors, and DOE retained $1.2B for direct-air-capture hubs.

🇪🇺 Europe: $11B across 52 deals, blending one giant public-finance package (the $2.3B EIB Clean Energy approval) with one of the deepest mid-stage deep tech layers anywhere. Green steel (Stegra, $1.65B), superconducting cable (Subra), organic flow batteries (CMBlu crossing unicorn), projectile fusion (First Light). First-of-a-kind closes, one after another.

🌏 Asia: $22B across 53 deals, nearly half the month’s global total. China anchored the mega-rounds (CATL’s $5B placement, plus humanoid robotics rounds from X Square, Pudu, and Booster), while India filled the renewables, hydropower, and EV long tail. Single Asian infrastructure deals routinely exceeded entire regional totals elsewhere.

🌍 Rest of World: $15.7B across 54 deals. Africa had an exceptional month at $8.3B, led by Egypt’s $5B Amun green ammonia pledge. Brazil’s BTG Pactual closed the largest reforestation fund to date at $1.24B, the first project globally to issue credits under Verra’s new VM0047 methodology.

A few patterns worth flagging: solar-plus-storage hybrids pulled $9.2B versus $2.9B into pure solar PV, so standalone solar is now the exception. AI-enabled climate solutions showed up in 11 separate raises. Public markets reopened as a growth channel, with X-energy and Sigenergy (which doubled on debut) leading a thick pre-IPO pipeline.

🌊 Jarek breaks it all down below, region by region, theme by theme.

But first: Who is Jarek?

Jarek Dmowski is a global transformation leader who partners with high-growth companies with positive climate impact. He combines industry and climate finance expertise with a strong track record of driving growth—across PE/VC-backed scaleups, ABN AMRO, and BCG.

He scaled a data-driven technology company ~2.5x to ~$25M in revenue and led post-merger integrations that enabled ~6x accelerated growth. At a global financial institution, he spearheaded a $2B capital reallocation toward new energy and mobility. He also developed a comprehensive climate plan that translated the Paris Agreement into actionable targets across sectors and established a $250M program to drive efficiency gains and reduce emissions at an energy utility.

Jarek is passionate about how the climate transition reshapes economies and business models, creating significant opportunities for multi-country growth and impact.

Follow the Money - April 2026

by Jarek Dmowski

Welcome to the next edition of “Follow the Money” - a monthly briefing on the capital flows shaping the climate transition.

$55B in April. April did not just continue the year’s momentum; it reset the ceiling. We tracked 207 climate-related investment deals totaling ~$55 billion - the highest monthly volume we have recorded, surpassing March’s previous record of $22B.

America is buying atoms while the rest of the world buys electrons. A $5B green ammonia mega-pledge in Egypt, the largest reforestation fund ever closed, and signs that China’s humanoid robotics sector is moving from labs into manufacturing. Public markets are reopening as a growth-capital channel for climate companies. Sovereigns and DFIs are writing large checks for adaptation and infrastructure. Asia’s utility-scale build-out is accelerating at unprecedented scale. And in the West, a deep and increasingly specialized layer of climate deep tech is finally reaching commercial scale. Let’s dive deeper.

Where did money flow in April 2026?

Explanation of the approach and source data: The investment list was developed based on disclosures, newsletter monitoring and review of climate news. Although not exhaustive, 207 climate-related investment deals were tracked - amounting to roughly $55 billion (all data in US$), covering all continents and different life stages of companies and development finance programs. Data skew toward early-stage companies and investments, as well as development financing programs. We are continuously working to expand the data sources and coverage of investments.

So, where did the money flow in April 2026?

• Asia-Pacific led decisively with ~$22B across 53 deals, followed by Europe (~$11B, 52 deals), Africa (~$8.3B, 29 deals), North America (~$6.8B, 48 deals) and Latin America (~$3.6B, 16 deals). Africa’s jump reflects both deeper coverage and a genuinely exceptional month of sovereign and DFI activity.

• Energy once again dominated, accounting for ~$38B across 101 deals - by far the largest category, month after month. Industrial was a clear #2 (~$8B, 30 deals), followed by AFOLU (~$3.6B), Transport (~$1.9B), Adaptation & Resilience (~$1.5B), Buildings (~$1.3B) and Climate Data (~$1.2B). Buildings remained structurally undercapitalized relative to their emissions share - a persistent gap.

• AI’s influence is becoming structural. Roughly 11 AI-enabled climate solutions raised capital in April - from grid intelligence (Verda, WorkOnGrid) to wildfire detection (Satellites on Fire) and food-system optimization (Afresh) - reinforcing AI as an accelerator of deployment, optimization and cost reduction across sectors.

• AI’s influence is becoming structural. Roughly 11 AI-enabled climate solutions raised capital in April - from grid intelligence (Verda, WorkOnGrid) to wildfire detection (Satellites on Fire) and food-system optimization (Afresh) - reinforcing AI as an accelerator of deployment, optimization and cost reduction across sectors.

• Robotics continued as a tracked category, with humanoid and embodied-AI rounds concentrated in China (X Square Robot $276M, Pudu $150M, Booster $137M) and a notable European cluster in autonomous monitoring (Kelluu, Bubble Robotics, Nature Robots).

• Public and development finance anchored the market at scale. Multilateral institutions and government programs supported ~$16B across over 60 deals, with a heavy tilt toward infrastructure, adaptation and on-lending facilities.

Let’s now dive deeper into 2026 watchlist themes (please refer to our December perspective for more details) and across regions to highlight technologies with real scaling potential over the next 3-5 years.

Which (of our 2026) themes were most strongly visible in April?

U.S: Nuclear and Geothermal vs. RoW: Solar and Wind

The divergence we have tracked since December hardened in April. In North America, capital concentrated in dispatchable, capital-heavy power for the AI build-out: X-energy priced its Nasdaq IPO above range at $23/share for ~$1B gross (its Xe-100 SMR and TRISO-X fuel platform now public-market funded), Blue Energy raised a $380M Series A for prefabricated reactors targeting data-center offtake, and geothermal developers Zanskar and TerraSpark added new funding. China’s closest comparable bet was NovaFusionX’s $102.5M fusion round - notable, but still fusion rather than deployable fission.

By contrast, Europe, Asia, Africa and Latin America deployed capital into proven, scalable infrastructure - solar, wind, storage and hydro - often at single-deal sizes that dwarf U.S. equity rounds. The clearest signal is that standalone solar is becoming the exception: in April, we tracked roughly $9.2B into solar-plus-storage hybrids versus ~$2.9B into pure solar PV. From Elgin Energy in the UK and Globeleq in Zambia to TotalEnergies × Masdar’s $2.2B solar-wind-BESS platform. The economics now favor pairing almost everywhere: co-locating batteries lets developers firm intermittent output, capture price spreads, and defer grid-interconnection bottlenecks - turning “cheap intermittent electrons” into dispatchable, gridable capacity.

“Solarpunk” Continues

The “cheap batteries + localized electrification” thesis kept widening across air, rail, road and water. The headline was Sigenergy (China), whose HK$4.4B (~$562M) Hong Kong IPO priced at HK$324.20 and closed up ~103% on debut - its SigenStor 5-in-1 PV+BESS+EV-charging system already holds ~28.6% of the global stackable distributed solar-storage market.

Road mobility was the deepest layer: Slate Auto (USA, $650M Series C, Bezos-backed) on an affordable customizable EV pickup; Also (USA, $200M, a Rivian spinout) on small EVs with DoorDash; Zūm (USA, $100M, $1.7B valuation) electrifying school transport; DeepWay (China, $137M) and Humble (USA, $24M) on electric/autonomous heavy freight; and a dense Indian and African layer - Simple Energy, Astranova Mobility, TrEV Mobility and Ethiopia’s Dodai (e-motorbikes).

The supporting infrastructure scaled too: robotic and ops-layer charging from ROCSYS (Netherlands, $13M) and &Charge (Germany, €5M), plus drivetrain enablers SmartD Technologies (Canada, SiC motor drives) and Ayr Energy (USA, grid transformers). Beyond the road, electrification reached new modes: Volant Aerotech (China, >$300M) and FAW Qiyi (China, ~$55M) on passenger eVTOL, and Voltify (USA, $30M) on battery-electric freight rail. Different markets, same physics: localized, electrified, battery-led.

Mid-stage, CapEx-intensive cleantech faces the “Valley of Death”

The month’s defining lesson was structural: the companies clearing the “valley of death” are the ones engineering blended capital stacks, not chasing a single instrument. Stegra (Sweden, formerly H2 Green Steel) reached an agreement in principle on a €1.4B (~$1.65B) equity-led mixed round - Wallenberg Investments forming a new lead consortium with Temasek and IMAS - to push its 740 MW green-hydrogen DRI steel plant through to operation. Sedron Technologies (USA) secured up to $500M of staged growth equity from Ara Partners to scale its Varcor biosolids/manure-upcycling system. And on the venture-debt end, CMBlu Energy (Germany) crossed the unicorn line with a €50M Series C first close (Samsung Ventures joining) for non-lithium organic flow batteries backed by a 5 GWh Uniper framework.

Robotics and Climate Tech

Robotics is now a permanent fixture in the climate-capital map, with a clear geographic division of labor. China led the embodied-AI mega-rounds: X Square Robot (~$276M Series B, Xiaomi and HongShan co-leading, cumulative funding >$400M), Pudu Robotics ($150M, service and commercial robots) and Booster Robotics ($137M, humanoids). Europe owned the direct, in-the-field niche: Kelluu’s monitoring airships, Bubble Robotics (Switzerland, $5M, autonomous ocean monitoring), Nature Robots (Germany, $5M, precision-ag autonomy) and All3 (Switzerland, $25M, robotics+AI for construction productivity).

Additional Highlights from April

• IPOs - Public Markets Reopen as a Climate Growth Channel: One of the clearest shifts in April was the return of the public market as a climate-growth instrument. X-energy priced a ~$1.0B Nasdaq IPO (XE) above its range and opened +31% - the first large advanced-nuclear listing of the cycle. In Hong Kong, Sigenergy’s ~$562M HKEX IPO more than doubled on its debut (+103%), with cornerstone investors including Temasek and Hillhouse. CATL tapped the H-share market for a ~$5.0B secondary offering to fund battery-capacity expansion. Behind the listed names, a thick pre-IPO pipeline formed: Spacety (~$190M, SAR satellites) and Chang Guang Satellite (~$70M, optical EO) prepared STAR Market filings; DeepWay ($137M tranche) and Pudu Robotics ($150M) raised ahead of HKEX listings; and India’s Simple Energy ($13.2M CCPS) lined up a pre-IPO round. The message: for capital-heavy climate hardware that has reached commercial traction, the exit window is open again.
  
  

• Nature Based Solutions: Nature had its strongest month on record. BTG Pactual Timberland Investment Group held the final close of the largest reforestation fund to date at $1.24B, targeting ~660,000 acres across Latin America - and its Brazil Cerrado 1 project was the first globally to issue credits under Verra’s VM0047 ARR methodology. The World Bank priced a $120M, 14-year Spekboom Restoration Outcome Bond in South Africa, while Living Carbon × Octopus ($513M) and Brazil’s BNDES–KfW/BMZ green declarations (~$810M) added scale.
  
  

• Biogas & Biomethane: The Quiet Workhorse of Hard-to-Abate: Biogas rarely makes headlines, but April showed it doing real work. GMT (UK) raised the category’s largest cheque - a ~$248M project-finance facility for biomethane. In Brazil, Tropical Bioás Edéia (bp bioenergy, ~$52M) produces biomethane from sugarcane vinasse, and the São Paulo Green Corridor / TransJordano project (~$28M) builds a refuelling corridor for heavy trucks. At the frontier, Hydron Energy (Canada) won non-dilutive NRC IRAP backing for single-step landfill-gas-to-RNG upgrading, and Nirova (USA, ~$3M) advanced anaerobic digestion.
  
  

• Climate Observation & Data: A Cluster of Financings: As climate volatility rises, the businesses that own the data layer are attracting real capital. The standout was Xoople (Spain, $130M Series B). Around it: Sygaldry Technologies (USA, $139M, energy-efficient AI servers); Starfish Space (USA, >$100M, in-orbit life-extension); China’s Spacety (~$190M SAR) and Chang Guang (~$70M optical); Kelluu (Finland) and Bubble Robotics (Switzerland) on airborne and underwater monitoring; WorkOnGrid (India, ~$2.4M); Clarasight (USA, $11.5M); and Satellites on Fire (Argentina, $2.7M).

Europe

Europe recorded ~$11B across 52 deals, blending a single very large public-finance package with one of the deepest mid-stage deep-tech layers in the world - green steel, superconductors, flow batteries, fusion, geospatial intelligence and a thick fermentation/biocontrol stack.

The structural anchor was the EIB Group Clean Energy Package (~$2.3B of multi-project lending approved in April), reinforcing the pattern of European public finance underwriting deployment while private capital concentrates on first-of-a-kind technology. Below it, Europe produced an unusually rich crop of investable deep tech.

Selected April financings:

• Stegra (Sweden) - ~$1.65B equity-led mixed round (agreement in principle); Wallenberg-led consortium with Temasek and IMAS to complete its 740 MW green-hydrogen DRI steel plant.

• Xoople (Spain) - $130M Series B (Nazca Capital lead); a satellite-based “Earth’s System of Record” for AI applications; total funding reaches $225M.

• Verda (Finland) - $117M Series B; cash-flow-positive AI cloud infrastructure (formerly DataCrunch) on 100% renewable power; an NVIDIA Preferred Partner.

• CMBlu Energy (Germany) - €50M Series C first close, crossing a $1B+ valuation; non-lithium organic flow batteries with a 5 GWh Uniper framework.

• Subra (Denmark) - €40M (~$46.6M) Series A led by Novo Holdings; high-temperature superconducting cable, paired with the acquisition of Germany’s THEVA.

• First Light Fusion (UK) - £25M first close led by East X Ventures’ Starmaker One, with UK Atomic Energy Authority strategic capital, for its FLARE projectile-fusion concept.

• Planetary, Cosaic, Agriodor & Fermtech - a clustered ~$45M across Switzerland, France and the UK in precision fermentation, food ingredients and biocontrol.

• Exergy3 & TheStorage - $12.3M (UK, ultra-high-temperature 50–1,200°C storage) and ~$4.2M (Finland, modular industrial thermal storage).

• Decade Energy (France) - ~$24M (€16M Eiffel project debt + ~€6M equity, SET Ventures lead) for a zero-capex logistics-electrification model.

• ROSI & E-magy - $23M (France, high-purity solar-PV module recycling) and a strategic EIT RawMaterials investment (Netherlands, silicon-dominant battery anodes).

• Plume, ROCSYS & All3 - Plume (France, €3.3M, AI renewable site-selection), ROCSYS (Netherlands, $13M, robotic EV charging) and All3 (Switzerland, $25M, construction robotics).

North America

North America recorded ~$6.8B across 48 deals - fewer dollars than Asia or Europe, but the sharpest thematic concentration of the month. The defining narrative is now unmistakable: the U.S. is buying firm, dispatchable power and hard-to-abate industrial decarbonization - nuclear, geothermal, industrial heat and durable carbon removal - at a pace and conviction no other region matches.

Selected highlights:

• X-energy (USA) - ~$1.0B Nasdaq IPO (XE), priced above range at $23.00 and opening +31%; Xe-100 SMR plus TRISO-X fuel - the first large advanced-nuclear public-market raise of the year.

• Blue Energy (USA) - $380M Series A (VXI Capital lead); MIT spinout building prefabricated reactors with a first Texas project targeting up to 1.5 GW of AI/data-center offtake.

• Living Carbon (USA) - $513M ($500M PF + $13M equity) from Octopus Energy Generation; photosynthesis-enhanced poplars targeting up to 50 Mt CO₂ removal.

• Sedron Technologies (USA) - up to $500M staged growth equity (Ara Partners); the Varcor system upcycles biosolids and manure into clean water, fertilizer and carbon-negative commodities.

• US DOE — DAC Hubs (USA) - ~$1.2B retained for direct-air-capture hubs (Stratos TX and Project Cypress), keeping the U.S. at the frontier of engineered removal.

• Zanskar (USA) - $40M non-recourse development facility (scalable to $100M; Just Climate, Spring Lane) to bridge greenfield geothermal pipelines to bank project finance.

• Glydways & Also (USA) - $170M and $200M Series C rounds for autonomous transit pods and Rivian-spinout small EVs (with DoorDash).

• Slate Auto & Zūm (USA) - $650M Series C (Bezos-backed affordable EV pickup) and $100M growth (TPG Rise, $1.7B valuation, school-transport electrification).

• Voltify, SmartD & Humble (USA/Canada) - freight and drivetrain electrification: Voltify ($30M, freight rail), SmartD (~$11M, SiC motor drives) and Humble ($24M, autonomous Class 8 hauler).

• Critical Loop & Ayr Energy (USA) - $26M and ~$12M for the grid-bottleneck layer: relocatable microgrids and domestic HV/MV transformers (>20 GW of US contracts).

• Helix Earth & Afresh (USA) - $12M (commercial-HVAC retrofit) and $34M Series B (AI grocery operations preventing 200M+ lbs of food waste; Just Climate co-lead).

• Sora Fuel, Disa & Nano One (USA/Canada) - Sora Fuel ($14.6M, single-step DAC-to-SAF), Disa Technologies ($33M, critical-mineral processing) and Nano One’s NRCan grant for one-pot LFP cathode.

• Starfish Space, Sygaldry, Clarasight & Cloneable (USA) - in-orbit servicing (>$100M), energy-efficient AI servers ($139M), corporate-travel carbon ($11.5M) and AI infrastructure inspection ($4.6M).

• TerraSpark, Hydron Energy & Nirova (USA/Canada) - early-stage decarbonization tech: geothermal subsurface AI (~$5.7M), landfill-gas-to-RNG upgrading and anaerobic digestion (~$3M).

Asia and RoW

Asia

Asia-Pacific recorded ~$22B across 53 deals - nearly half the month’s global total - with China anchoring large battery, robotics and grid rounds and India dominating renewables, hydropower and the mid/small EV-and-water layer. The scale here is simply different: single Asian infrastructure deals routinely exceed entire regional totals elsewhere.

Key highlights from Asia:

• CATL (China) - ~$5.0B EV-battery placement, the single largest tracked deal of the month.

• Kamala & Kalai-II Hydropower (India) - ~$2.8B and ~$1.65B NHPC/THDC joint ventures in Arunachal Pradesh - large storage hydro returning as firm capacity.

• TotalEnergies × Masdar (UAE / multi-region) - $2.2B Asia renewables platform (solar + wind + BESS), plus a separate $1.2B Kazakhstan wind+BESS FID.

• Sigenergy (China) - ~$562M HKEX IPO that closed ~103% up on debut; its SigenStor integrated PV+BESS+EV-charging system holds ~28.6% of the global stackable distributed solar-storage market.

• X Square Robot, Pudu & Booster (China) - $276M, $150M and $137M into humanoid and service robotics.

• Spacety & Chang Guang (China) - $190M and ~$70M pre-IPO rounds for SAR and optical Earth-observation constellations.

• Envision Energy & NovaFusionX (China) - $500M (BBVA vendor-finance facility) and ~$102.5M (modular FRC fusion).

• Volant Aerotech & FAW Qiyi (China) - >$300M and ~$55M into passenger eVTOL; FAW’s is the largest angel-stage eVTOL round in China to date.

• Graphite Energy (Australia) - A$40M (~$26M, debt + equity) for renewable-powered thermal energy storage replacing fossil boilers.

• ECOMMIT (Japan) & WorkOnGrid (India) - ~$10M Series B (circular-economy / waste-data; Mercari backing) and ~$2.4M (AI “DiscomGPT” utility intelligence).

• India’s EV & water long tail - Simple Energy ($13.2M pre-IPO E2W), Astranova Mobility ($6.4M), TrEV Mobility ($0.43M) and AquaPulse ($2.94M, IoT water-quality monitoring).

RoW

RoW (Africa, South America, Australia) recorded ~$15.7B combined across 54 deals. Africa recorded ~$8.3B across 29 deals, Australia ~$3.8B across 9 deals and Latin America ~$3.6B across 16 deals. As in prior editions, the picture across these markets remains anchored by MDB and DFI interventions and blended-finance structures, while commercial private capital stays comparatively constrained - with two striking exceptions this month: a $5B private green-ammonia pledge and the largest reforestation fund ever closed.

Selected highlights:

• Egypt Amun Green Ammonia / EAGA (Egypt) - $5B Phase-1 pledge (scaling to $10B), 400 ktpa green ammonia powered by 2 GW of hybrid solar+wind at Ras Banas.

• Central-West Orana REZ (Australia) - ~$3.6B for Australia’s first contestable Renewable Energy Zone transmission project (4.5 GW initial transfer capacity).

• BTG Pactual TIG Reforestation Fund (Brazil / pan-LATAM) - $1.24B final close - the largest reforestation fund to date - and the first project globally to issue credits under Verra VM0047.

• BNDES – KfW / BMZ Green Declarations (Brazil) - BRL 4.1bn (~$810M) of bilateral green cooperation signed at Hannover Fair 2026.

• KfW / World Bank — South Africa (South Africa) - a $540M JET-P grid-expansion loan plus the $120M Spekboom restoration outcome bond and a $200M IFC green-buildings facility for Investec.

• Adaptation Fund — Southern Africa (multi-country) - close to $134M approved at the 46th Board meeting, including Malawi’s $20M smallholder resilience project and the transboundary Kunene River Basin project (~$24.55M).

• Dodai (Ethiopia) - $13M Series A ($8M equity + $5M BII debt) for locally-assembled electric motorbikes, with expansion planned across West and East Africa.

• Tropical Bioás & São Paulo Green Corridor (Brazil) - ~$52M (biomethane from sugarcane vinasse) and ~$28M (biomethane heavy-truck refuelling corridor).

• Satellites on Fire (Argentina) - $2.7M seed (Dalus Capital lead) for real-time wildfire detection ~35 minutes ahead of NASA’s FIRMS service.

What will we observe in 2026?

Q1 set the tone; April redrew the scale. The structure we have tracked all year held - and hardened: firm, capital-heavy power in the U.S.; mass-market and utility-scale electrification across Asia; policy-backed project finance and deep tech in Europe; and blended adaptation and nature finance across the Global South. April did not break the pattern. It supersized it - and added the sharpest nuclear-versus-renewables, nature-based-solutions and robotics signals we have recorded.

May will test whether $55B was a structural step-change or a coverage-and-mega-deal spike. We will be watching whether the themes identified in December continue to deepen:

• U.S.: Nuclear and Geothermal vs. Rest of World: Solar and Wind

• “Solarpunk” Momentum - electrification beyond cars, powered by cheap batteries

• Dual-Use Innovation: Climate + Defense, Supply Chain, Compute

• CapEx-Intensive Mid-Stage Tech and the “Valley of Death”

• Industrial Heat Electrification

• Nature-Based Solutions for Carbon and Biodiversity

• AFOLU Innovation - including climate adaptation, robotics, and alternative proteins

• The Rise of Climate Robotics

Stay tuned for next month’s edition as we continue to follow the capital shaping the climate transition.

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Hey there! 👋

In two hours, at 9am PT, Katie Gilbert runs Climate Drift's Thought Leadership Clinic and Office Hours. It's free and it's live. If any part of the story below lands for you, this is the lowest-effort way to test whether the program is a fit.

Join the clinic

Katie runs a six-week program inside Climate Drift called Thought Leadership for Humans. The second cohort starts June 1. Today’s clinic is your chance to meet her, ask whatever you want, and see how she teaches before committing to anything.

Now to the interesting part: Maria Gomez’s story.

Maria leads the Climate Venture Lab at Mercy Corps Ventures, and she came into the first cohort with six pilots wrapping up at once, a mountain of lessons the broader field needed, and no plan for getting any of it out. Katie and I worked through what shifted for her over those six weeks, and Maria wrote her own account below. If you’ve ever sat on work you know is useful and just never posted it, read hers.

If you do one thing today, join the clinic. 9am PT, two hours from now.

🌊 Let’s dive in

But first, who is Katie?

Katie is a Philadelphia-based writer, editor, and educator with over 20 years of experience and a longtime focus on climate and social impact. As a journalist, she’s covered sustainable finance for Institutional Investor and Responsible Investor, and her longform feature on an economic and political experiment in Jackson, Mississippi was one of Oxford American’s most-viral stories of the year. Her journalism has also been published in The Atlantic, Al Jazeera America, Psychology Today, and elsewhere.

She works with universities, brands, and mission-driven organizations to connect their people’s ideas to wider audiences. Current and past clients include Stanford Insights, Columbia Business Magazine, Yale School of Management’s Yale Insights, and impact investing nonprofit ImpactAssets.

Katie also teaches a writing course for visual art students at Massachusetts College of Art and Design, and she previously taught journalism at Manhattanville College in New York.

Starting on June 1st, Katie will be running the second cohort of a six-week program inside Climate Drift called Thought Leadership for Humans.

Think of Thought Leadership for Humans as a classroom, lab, and community space rolled into one. The goal: equip would-be climate leaders with the structures, processes, inspiration, and feedback they need to finally step into their own voices.

Schedule a call with Katie

Each week of the program will include an audio lesson to kick off the theme of the week; two live calls; visits from guest experts (including investors, established thought leaders, and content-strategy experts); show-and-tell sessions where cohort members get feedback on projects-in-process; and weekly challenges to get participants sharing publicly, right away.

Learn more

Your voice is load-bearing infrastructure

In the climate space, we talk a lot about what’s missing.

Missing capital. Missing policy. Missing technology. Missing time.

What we talk about less (because it feels somehow less serious, more self-promotional, more optional) is missing voices.

But here’s what I’ve come to believe after years of working with researchers, founders, and practitioners doing important work in relative obscurity: a public voice isn’t a vanity project. It isn’t a personal brand exercise you get to do once the real work is done. For people doing serious climate work, a recognizable public voice is load-bearing infrastructure, and it’s as essential to the work as the technology, the data, or the funding it exists to attract.

Think about how climate work actually moves forward. Investing runs on relationships and reputation. Procurement runs on trust. Hiring runs on recognition. Partnerships form because two people read each other’s work and thought: this person gets it.

None of that happens in silence.

Maria Gomez leads the Climate Venture Lab at Mercy Corps Ventures, an impact investment fund running grant-funded pilots for early-stage climate startups in the Global South. After two years of building the lab, running pilots, and accumulating hard- won lessons, she had a mountain of knowledge that the broader ecosystem needed and wasn’t getting. Sharing it wasn’t optional. It was, in her words, “a core part of what our organization is here to do.”

But knowing something needs to be shared and knowing how to share it are different problems.

Maria arrived at Thought Leadership for Humans with the first solved and the second wide open.

What she worked through over six weeks traces an arc that I’ve watched many serious people move through, and that I think will feel familiar to a lot of you reading this.

First: permission.

Before Maria could think about strategy, she had to reckon with whether she was entitled to a public voice at all. She’d moved into the climate space only two years earlier. She doesn’t have a scientific background. Looking around at researchers and veterans with decades of experience, she couldn’t figure out how to position herself as any kind of authority.

What she found, and what almost every cohort member finds, regardless of their credentials, is that this feeling is nearly universal. And it’s based on a flawed premise. Thought leadership doesn’t require being the foremost expert in a field; it requires a genuinely held, specific perspective and a real motivation to share it. Maria recognized that her unique perspective (two years inside the messy, generative reality of running climate pilots in emerging markets) was not a liability, but a useful lens.

Then: clarity.

With permission in place, the next problem was coherence. Maria’s instinct had been to share her pilots’ findings as they came: story by story, insight by insight. What the program surfaced was how incomplete that approach is. Without a through line, without a bigger story that everything connects to, content becomes a series of isolated moments rather than a body of thought. It doesn’t build. It doesn’t compound. It doesn’t give an audience a reason to keep coming back.

The work of Week 3 (defining your core themes, articulating the thread that connects everything you want to create) shifted Maria from “here’s what this one pilot found” to “here’s the bigger story I’m intentionally building.” That shift, she says, was the biggest one.

And finally: motion.

Even with permission and clarity, there was still the problem of perfectionism. Maria is someone who wants to get things right before she puts them out. In her professional life, that instinct serves her well. In building a public voice, it had been keeping her stuck.

It turned out that the mindset shift she needed was surprisingly close to home. Maria’s work is built around running small, structured pilots: low-stakes experiments designed to generate data, not to be definitive. When the program introduced tiny experiments in Week 1 (basically the same methodology she was used to, but applied to thought leadership) something clicked. You don’t need the perfect piece. You need a low-stakes test that teaches you what resonates, so you can iterate toward something more powerful.

The arc from permission to clarity to motion is not linear, and it doesn’t look the same for everyone. But it is, in my experience, the arc that almost every serious person needs to travel before their work can reach the people it was built to reach.

Below, Maria describes what that looked like for her.

Why a New Type of Communication Felt Urgent

By Maria Gomez, Climate Venture Lab Lead at Mercy Corps Ventures

I lead the Climate Venture Lab at Mercy Corps Ventures, an impact investment fund. Our lab provides grant funding to early-stage startups in the Global South that are developing innovative, climate-resilient technologies. We run pilots (small, structured experiments) that give startups a chance to test and prove out their products with real funding behind them.

After two years of setting up the lab, finding partners, and running pilots, I suddenly found myself at a turning point at the beginning of this year: six or seven pilots were wrapping up at the same time, and I had a mountain of lessons learned. Sharing those lessons publicly isn’t just a bonus celebration; it’s a core part of what our organization is here to do. We want the broader ecosystem to know what technologies we’re excited about, and what worked, what didn’t, and where challenges remain.

The problem was that I had no real plan for how to do that. I felt disorganized and all over the place. I worried that if I just randomly shared each pilot’s story as it came, none of it would be very cohesive or compelling.

When I saw the information about Climate Drift’s Thought Leadership for Humans program, the timing felt exactly right.

The Impostor Problem: Who Gets to Be a Thought Leader?

Before I could get into the strategy and mechanics of thought leadership, I had to reckon with something more personal: I wasn’t sure I deserved the label.

I moved into the climate space only two years ago. I don’t have a scientific background. When I looked around at others in this field, people who’d been in it for decades or who came from research, I struggled to frame myself as any kind of authority. I wanted to share what we’d learned in a way that felt authentic to me and with an approach based on my actual experience.

What I came to understand from the other (credentialed, impressive, impactful) people in our TL4H cohort is that this feeling is almost universal. The program helped me see that thought leadership doesn’t require being the foremost expert in a field. It requires having a genuinely held, specific perspective and a real motivation to share it.

For me, that motivation was clear: a key part of my job is to share what we learn. And the investment world, in particular, runs on relationships and reputation. Building a recognizable voice isn’t vanity; it’s how this work gets done.

Stop Waiting for Inspiration and Build a Strategy

If I could go back and give myself advice a year ago, it would be this: being intentional before you start sharing is everything.

Before the program, my mindset was: I have these stories, I’ll share them in a compelling way, and that’ll be it.

What the program helped me see is how incomplete that is. Sharing content without a strategy leaves you at the mercy of inspiration’s whims, and that makes it very hard to actually build an audience or achieve anything consistent or meaningful.

What changed for me was learning to ask a specific set of questions before I publish anything:

• What do I actually want to achieve with this?

• Who is my audience, and what do they need from me?

• What are the two or three themes I want to be consistently associated with?

• What’s the through line across everything I share?

• How will I know if it’s working?

Moving from “here’s what this one pilot found” to “here’s the bigger story I’m intentionally building” was the biggest shift for me.

I’ve Changed How I Think About Starting

One of my favorite parts of the program was the concept of tiny experiments, which came in the very first week. It resonated with me professionally, because running small pilots is literally what my work is built around, but I hadn’t applied that mindset to my own thought leadership.

I’m the kind of person who wants to get things perfect before sharing. I want to make sure everything is polished and complete. What the program pushed me to see is how counterproductive that instinct can be when you’re trying to build a public voice. You don’t need the perfect piece; you need a low-stakes way to test what resonates, learn quickly, and iterate.

Paired with the metrics-focused session, which got me thinking clearly about what I actually want to measure and what I want to learn from each piece I put out, I came away with a much more practical and less paralyzing framework for actually getting started.

Writing Helps You Think (Even If No One Reads It)

Here’s something I didn’t expect: the process of going through the program clarified things for me that had nothing to do with posting on LinkedIn.

Working through the exercises, thinking about my themes, doing the audience research: all of it helped me think more clearly about my organization and my work. Something happens when you’re forced to articulate what you believe and why it matters. It sharpens you, even privately.

This feels especially worth naming in a world where it’s easy to outsource all of that to an AI tool. You can generate something to post in two minutes, check the box, and move on, but two minutes later you probably won’t remember it, and it probably didn’t say anything that original. The thinking part of thought leadership is where the real value lives, and you can’t skip it.

Where I Am Now

Coming out of the program, I have a document with my themes mapped out, audience research done, and a real communication strategy for the rest of the year. It’s a work in progress, and finding time is still hard, but I feel I’m much more organized and focused on my next steps than I was when I came in.

My thought leadership archetype is, at its core, about storytelling: telling the stories of the startups we work with and the things we’ve learned together. That felt daunting at first. Now it feels like something I actually have a plan to achieve.

Maria works at Mercy Corps Ventures, where she leads the Climate Venture Lab. You can follow her thought leadership on LinkedIn and through the Mercy Corps Ventures LinkedIn page.

The Arc Is Available to You

Maria’s closing observation is one I want to leave with you before we get to the program details:

“Something happens when you’re forced to articulate what you believe and why it matters. It sharpens you, even privately.”

That’s not a marketing claim; it’s someone describing what happened to her thinking, separate from any post that got published, any audience that grew, any metric that moved. The process of working through these questions has value that doesn’t depend on anyone else seeing it.

But people do see it. That’s also the point. And when they do, things move.

Maria came into TL4H without a plan, without a through line, and without permission to call herself any kind of authority in the climate space. She left with her themes mapped, her audience identified, a communication strategy for the rest of the year, and, perhaps most importantly, a method: a way of thinking about starting that doesn’t require everything to be perfect before anything gets shared.

That arc (permission → clarity → motion) is available to you too.

Learn more

The Second Cohort of Thought Leadership for Humans Starts June 1

We’re forming the cohort now, inside Climate Drift.

What the six weeks includes:

• A complete, sequenced curriculum, built specifically for serious climate leaders, not for generic content creators. The six weeks move in a deliberate order: you build the inner foundation first (experiments, beliefs, themes), and only then move to the outer architecture (audience, strategy, metrics). As one first-cohort participant put it: “The outer architecture is only as useful as your inner clarity behind it.”

• Two live calls each week, including guest experts who have built real audiences, raised funding through their public thinking, and led communications at major climate organizations.

• A cohort of peers who understand the urgency of what you’re building. The community inside TL4H is one of its most quietly powerful features; participants consistently name their fellow cohort members as among the most generative creative relationships they’ve built: “The diversity of perspectives in the room created a kind of creative momentum that’s hard to replicate. I zeroed in on my project in a way that thrills me.”

• Async flexibility: all calls are recorded, all feedback is available outside of live sessions, and the program is designed to be valuable even when life gets in the way. Perfect attendance is not the price of admission.

The program is for you if:

• You have more ideas than output.

• You suspect your visibility gap is costing you real opportunities: funding not attracted, partnerships not formed, influence going to people doing shallower work.

• You’ve tried to build a public voice before and stalled. You know your work deserves to travel further than it currently does, and you haven’t been able to make that happen alone.

You don’t need to already see yourself as a thought leader. Maria didn’t. She just needed to find her through line, and step into the structure to follow it.

Investment and Scholarships

$947 USD includes all six weeks of curriculum, live sessions, guest expert access, cohort community, async feedback, call recordings, and three months of access to the full Climate Drift Community.

Need-based scholarships are available because we don’t want cost to be the only barrier to doing this work with us.

⚠️ Scholarship deadline: Monday, May 25. If you’d like to be considered for a scholarship, you must reach out to schedule a call with Katie by the end of the day on Monday, May 25.

Subscribe now

This isn’t a sales call. It’s a real conversation about where you are, what you’re trying to say, and whether TL4H is the right structure for you right now. Some people are ready. Some need a different starting point. Katie will tell you honestly which one you are.

Cohort 2 begins June 1. The scholarship deadline is May 25.

Subscribe now

Hey there! 👋

Most of the climate operators I know flinch at the phrase “thought leadership.” It sounds like LinkedIn theater. People typing in airport lounges about “lessons learned” so the algorithm will reward them.

Then last week, Sharon Szmolyan finished six weeks inside our Thought Leadership for Humans program and sent us a definition I haven’t been able to stop thinking about:

“Thought leadership is not, ultimately, about having an interesting voice or sharing ideas. It is about consequence. It is about whether what you’re saying changes how something is seen, and therefore what becomes possible.”

Under that definition, thought leadership becomes a question of responsibility. What are you carrying that the world doesn’t yet see, and what does it cost when you keep it to yourself?

Today we are looking at:

• What changes when an unformed idea finally gets the structure it deserves

• A definition of thought leadership grounded in consequence rather than self-expression

• Sharon’s orphan-wells project and why it stayed invisible until she built a public architecture around it

• How First Nations participation became structural to the project’s design

🌊 Let’s dive in

But first: Who is Katie?

Katie is a Philadelphia-based writer, editor, and educator with over 20 years of experience and a longtime focus on climate and social impact. As a journalist, she’s covered sustainable finance for Institutional Investor and Responsible Investor, and her longform feature on an economic and political experiment in Jackson, Mississippi was one of Oxford American’s most-viral stories of the year. Her journalism has also been published in The Atlantic, Al Jazeera America, Psychology Today, and elsewhere.

She works with universities, brands, and mission-driven organizations to connect their people’s ideas to wider audiences. Current and past clients include Stanford Insights, Columbia Business Magazine, Yale School of Management’s Yale Insights, and impact investing nonprofit ImpactAssets.

Katie also teaches a writing course for visual art students at Massachusetts College of Art and Design, and she previously taught journalism at Manhattanville College in New York.

Starting on June 1st, Katie will be running the second cohort of a six-week program inside Climate Drift called Thought Leadership for Humans.

Think of Thought Leadership for Humans as a classroom, lab, and community space rolled into one. The goal: equip would-be climate leaders with the structures, processes, inspiration, and feedback they need to finally step into their own voices.

Schedule a call with Katie

Each week of the program will include an audio lesson to kick off the theme of the week; two live calls; visits from guest experts (including investors, established thought leaders, and content-strategy experts); show-and-tell sessions where cohort members get feedback on projects-in-process; and weekly challenges to get participants sharing publicly, right away.

Learn more

When thought leadership isn’t all about you

Here’s the definition of thought leadership that Sharon Szmolyan arrived at after six weeks in Thought Leadership for Humans. It’s not one I’ve heard anyone else put quite this way:

Thought leadership is not, ultimately, about having an interesting voice or sharing ideas.

It is about consequence. It is about whether what you’re saying changes how something is seen, and therefore what becomes possible.

Considered this way, thought leadership becomes less about expression and more about responsibility. It’s about carrying something forward that isn’t yet fully seen.

Bring to mind the writers and speakers and makers who called you into the work that needs to be done for the climate. Maybe you haven’t lumped them into this motley category of “thought leaders,” but if we apply Sharon’s definition, maybe that’s exactly what they are. They’ve taken up the responsibility to make the unseen seen. I think of Rachel Caron’s “Silent Spring,” Paul Hawken’s Project Drawdown, and the insistent hope coursing through Ayana Elizabeth Johnson’s “What if We Get it Right?” book, podcast, and newsletter

I want to dwell on the word responsibility, because it reframes the entire conversation.

Most of the people I work with arrive at thought leadership through something like obligation (at least at first). They’ve been told they should post more. And they sense their visibility gap is costing them something. That’s a real problem, and it’s worth solving.

But Sharon arrived at something harder and more clarifying: the recognition that the work she’s building (an initiative to purify and restore the vast volumes of water produced through oil and gas extraction in Alberta) is not yet fully visible to the people who need to encounter it. And that this is not just a personal cost. It is a cost to the work itself.

When serious people with serious solutions stay quiet, something fills the space they leave. Usually something shallower.

The real question Sharon was sitting with wasn’t “how do I promote myself?” It was: “what am I responsible for carrying forward? And what structure do I need to carry it at the level it deserves?”

Thought Leadership for Humans gave her that structure.

Over six weeks, a powerful but unformed idea became something with real architecture: she conceived a podcast and set it in motion, she hammered out a thematic framework for the initiative, she started fleshing out an op-ed targeted at a major publication.

Sharon entered the program asking “how do I do this?” and left with a method: one grounded in a clear sense of audience, consequence, and what she is specifically positioned to say.

What that process looked and felt like from the inside is what she describes below.

What I’m Working to Build

By Sharon Szmolyan

My career has not followed a straight line. I come from a place where oil and gas is the predominant economy. That’s a very particular domain, with a very particular set of values, many of which I never aligned with. So I left. What I moved toward wasn’t another industry so much as a different way of thinking. What’s driven me ever since I can remember is not the pursuit of a title, but pure curiosity.

That curiosity eventually led me to my current work: an initiative centered on the vast volumes of water produced through oil and gas extraction, water that is typically viewed and treated as waste, contained, or left unaddressed. I’m currently developing the infrastructure that will purify that water and return it to natural watersheds.

I’m launching my initiative in Alberta, where I’m from, and where the reality of orphan wells is not abstract but lived, on land, across communities, and over time.

And, these wells are not static. Across their life cycle, they continue to emit methane—sometimes as high-volume “super-emitters,” and in other cases as slower, persistent sources over time. Though largely invisible, the wastewater and methane emissions are evidence of a system that continues to operate long after responsibility has shifted, or disappeared entirely, leaving taxpayers burdened by the consequences.

The intention of this work is to begin where impact is most immediate, addressing those sites where emissions are highest, while developing a model that also reconsiders how processed water is held, treated, and ultimately reintegrated into broader watershed systems.

From there, the work extends outward. But the premise isn’t simply technical. It’s perceptual—because how we see a system determines whether we treat it as something to extract from, or something to be in relationship with. And that shift, from extraction to partnership, changes the trajectory of what comes next.

The ambition of my project is concrete: 500 water-restoration projects globally over 10 to 12 years, each one grounded in a specific site, each one contributing to a broader shift from extraction toward relationship, where responsibility, continuity, and care are re-established within the ecological systems we are already part of.

I Didn’t Know What “Thought Leader” Meant (and That Turned Out to Be an Advantage)

Before joining Thought Leadership for Humans, I didn’t have a clear definition of thought leadership, and I certainly didn’t apply the term to myself. In hindsight, that absence was useful. Without a fixed idea of what it should look like, I was able to arrive at a definition that actually fits the work.

What it means to me now is far more rigorous than I would have assumed. It’s not about having an interesting voice or sharing ideas. It is about consequence; it is about whether what you’re saying changes how something is seen, and therefore what becomes possible.

There are many people operating at a small scale, and that has value. But what became clear in the program is that there is another level, where ideas begin to shape how a society, or a generation, understands a system it previously took for granted.

At that level, thought leadership becomes less about expression and more about responsibility. It’s about carrying something forward that isn’t yet fully seen.

It also becomes about participating in a broader cultural shift, one that moves us away from an extractive/dominator mindset, where value is taken for granted, toward a partnership-based ethos grounded in relationship, continuity, and mutual responsibility.

Stop Speaking Into a Vacuum

One part of Thought Leadership for Humans that shifted my thinking significantly was the focus on audience.

If you don’t understand what your audience is seeing, needing, or missing, you are speaking into a vacuum. Your ideas may be important, but without a feedback loop, without a living conversation, you cannot know what’s actually landing, or how to refine it so that it does.

For me, that insight translated into a very concrete next step: launching a podcast.

The purpose isn’t to broadcast solutions. It’s to build a foundation of understanding, particularly around orphan wells and the risks they pose, which remain largely outside public awareness. I’m speaking to people who are already climate-aware, but who haven’t yet encountered this specific reality.

That audience-focused part of Thought Leadership for Humans also clarified something else: who needs to be in relationship to this work. First Nations communities are not just an audience; their participation is essential. In Canada nothing on Crown land occurs without their concurrence, part of the legacy of the Truth and Reconciliation mandate.

Finally, because this is about building a solutions-oriented systemic mindset, it is imperative to look at problems through the eyes of different stakeholders to understand their influence on the system and then to deconstruct problem-framing by turning obstacles into questions of ‘How.”

An Idea Became a Structure

One of the most important outcomes of my time in Thought Leadership for Humans is that what began as a powerful but somewhat unformed idea became something with real architecture.

Over six weeks, I developed a sequence of practices that now underpin the podcast and the broader initiative. I began with the question “How do I do this?” and what was born is the method, one that looks at how we perceive, name, and relate to systems that are often invisible, but still active.

The clarity the program helped me gain around my audience and the work we did to define thematic pillars yielded, for me, a concrete publishing goal: an op-ed, framed as an open letter to Mark Carney, targeted for a major publication such as The New York Times.

All of this means that this initiative has real legs, and that it can become real-life, meaningful work.

I now recognize that moving from an idea to impact requires intention, structure, and a willingness to engage at the level where decisions are made.

What the program offered was not just guidance, but the conditions that made it possible for me to move from belief to execution.

If there’s one thing I would pass on to others, it’s this:

Curiosity will get you started.

But it is the structure you build that allows your work to be seen, understood, and taken seriously.

There are those fortuitous moments in life when things align and you’re willing to take that life-transforming step into a new world. That is what Thought Leadership for Humans was, and is, for me.

The Second Cohort of Thought Leadership for Humans Starts June 1

We’re forming the second cohort now, and it’ll run inside Climate Drift.

Here’s what six weeks looks like:

Week 1: Tiny Experiments. You don’t wait until you’re ready. You design a small, specific, time-bound experiment, and then run it. Over the course of the program, we’ll design, run, and analyze two iterations of your tiny experiment. Comparing notes with other people in the cohort turns out to be one of the most educational elements.

Instead of goals with finish lines, we’ll build (and refine) hypotheses to learn from.

Week 2: Limiting Beliefs. The internal blocks that stop serious people from putting themselves out there don’t disappear when you ignore them. This week, you name them. Naming doesn’t automatically dissolve a block, but it means you can start working with it rather than around it.

Week 3: Three Core Themes. What are you actually trying to say? This week adapts a traditional marketing “perceptions” exercise and pushes you to get specific. Who are you speaking to, what threads connect everything you want to create, and what do you want to be consistently associated with over time?

Weeks 4–6: The outer architecture. Platforms, content strategy, audience research, metrics, workflow: All of this follows from what we unpack in Weeks 1-3, so we dig into it in the back half of the program. As one of our participants put it: “The outer architecture is only as useful as your inner clarity behind it.”

Running alongside the curriculum each week:

• an audio lesson to kick off the week’s theme,

• two live cohort calls,

• guest experts who have built real audiences and raised funding through their public thinking,

• show-and-tell sessions where cohort members share work-in-progress and get direct feedback from Katie and each other, and

• Async feedback on your writing and ideas-in-progress from Katie.

The community that forms inside TL4H is one of its most powerful features. First-cohort participants named their fellow cohort members as among the most generative creative aspects of the experience: “The diversity of perspectives in the room,” one participant wrote, “created a kind of creative momentum that’s hard to replicate.”

This program is for you if:

You’re doing important climate work and the people who need to hear about it don’t know you exist. You know that what you’re carrying deserves to travel further than it currently does, but you haven’t found the momentum or will to get in moving.

You don’t need to already see yourself as a thought leader. Sharon didn’t. She just needed to find what she was responsible for carrying, and the structure to carry it at the level it deserves.

Learn more

Applications for the second cohort are open now. Spots are limited and reviewed on a rolling basis.

If you’re ready to find out what becomes possible when your work finally has the architecture to travel, schedule a 30-minute call with Katie:

Schedule a call with Katie

Subscribe now

Hey there! 👋

Skander here.

Today we are learning in public again: Kruthika Eswaran is an atmospheric scientist and climate-resilience researcher.

She joined Katie’s first Thought Leadership for Humans cohort with a familiar problem: She had the expertise, ideas & desire to communicate.

What she didn’t have yet was a structure that helped her start.

Six weeks later, she had a weekly climate doodle practice, a live workshop confirmed in Singapore, and a graphic novel in motion.

Below, she shares what changed, what got her unstuck, and what other climate experts can learn from her journey.

Readers of this newsletter are well aware that, by now, we have all the science, technology, and financial tools necessary to step into a brighter climate future.

What’s too often missing is execution: the ability and the broader support structure to set these solutions in motion.

What’s true on the broader level is true on the individual level, too.

The credentialed climate researchers, founders, and practitioners I work with are not lacking in good ideas.

They’re definitely not lacking in the desire to share their work more widely.

What they’re missing is structure.

Without it, even the smartest, most motivated people get stuck in the same loops of fits and starts. They open a draft and close it. They think about posting and talk themselves out of it. They watch someone less qualified hold the floor in a conversation they should be leading, and feel a sharp frustration they never quite act on.

These climate leaders don’t need to magic up more confidence, more time, or even more inspiration. The fix is clear structure: a defined sequence of steps that takes a smart person out of their head and into a thought-leadership practice with real motion.

That’s what Kruthika Eswaran found in the first cohort of Thought Leadership for Humans, a six-week program run within Climate Drift.

Kruthika is an atmospheric scientist and climate-resilience researcher. She came into the program without a clear sense of what thought leadership meant for someone like her, and with a mental image of what a thought leader looked like that felt nothing like who she was.

Six weeks later, she had a weekly practice generating real feedback from her audience, a live workshop confirmed in Singapore, and a graphic novel underway.

She didn’t find a new personality; she found a structure.

Below, she describes her experience in TL4H, and breaks down what got her moving (in the hopes that these takeaways might move you, too).

We’re opening up a free Thought Leadership Clinic on Wednesday, May 20, at 12pm EDT! Bring your drafts-in-progress for quick workshopping, glimmers of ideas for group gut-checking, and/or research questions for help building out your tiny thought-leadership experiments. You’ll come away with actionable feedback from Katie on your projects, and insight from what others are working on, too.

Join now

From a Nobel Prize Dream to a Different Kind of Impact

By Kruthika Eswaran, atmospheric scientist, climate-resilience researcher, and creator of climate doodles

If there’s one word that describes my background, it’s “researcher.” From a young age, I had a clear ambition: I wanted to win the Nobel Prize. As I understood it, the path to making a difference required expertise in compiling, analyzing, and publishing scientific research. I earned my PhD in atmospheric sciences, focusing my research on the role of aerosols in our atmosphere using satellites and radiation models.

Then COVID happened. I was in isolation in France, stuck between four walls, and I found myself tracing a long, slow thought spiral. I started asking uncomfortable questions: Was sitting in the background, producing research that few people directly encountered, really the kind of impact I wanted to have?

The answer that kept coming back was no. I wanted to be on the front line. I wanted to engage with people face to face. Most of all, I wanted to inspire people to take action.

That realization set off a winding journey. I tried corporate sustainability consulting, but I couldn’t use my skills the way I wanted to. I kept moving, kept searching, until I arrived at something much simpler and more honest:

I wanted to be a communicator and a changemaker, someone who could break down complex, interconnected problems, like climate change, the energy transition, AI, and societal disruption, in ways that actually moved people to act.

Eventually, I realized that to do that at any real scale, I was going to have to understand thought leadership.

What I Believed a “Thought Leader” Was

Before Thought Leadership for Humans, my mental image of a thought leader was something like a philosopher mixed with a cult leader: someone who talks about many different topics with ease, draws people in, and amasses followers.

It’s not that I’d pinned thought leaders as manipulative. That was just the best way I could think of to describe the actual core of what thought leaders do: they have the power to gather people and inspire them to listen. That is genuinely powerful, regardless of what it’s pointed toward.

What the six weeks in TL4H changed for me wasn’t that core definition; I still think that this gathering-power is the heart of thought leadership. What changed was my understanding of how many different forms that power can take.

Learning about the six archetypes of thought leaders from Katie was, for me, one of the most important unlocks early on. I had never thought about the fact that one of these archetypes, The Translator (someone who takes complex ideas and makes them accessible), is just as much a thought leader as a magnetic Storyteller or a Connector who bridges different communities.

Seeing that wide range of thought-leadership styles made it possible for me to locate myself in it. Once I could see and claim my own type, I could stop wondering whether I “counted” as a thought leader and start thinking about how to do it well.

Start Before You’re Ready

One of my favorite parts of the program was the first week: Tiny Experiments. The idea is simple but subversive: instead of waiting until you have a perfect plan, you run a small, consistent action over a defined period of time and pay attention to what you learn.

The experiment I designed in the first week was this: I would post one climate doodle or cartoon every week, on the topic of extreme heat, for four weeks, and create them in a way that a school-age child could understand.

Over the next couple of weeks, I could see that the experiment was working. I posted the doodles, shared them with my network, and got genuine feedback that kids were understanding the content. That confirmation was important, not just as validation, but as a data point. The tiny experiment showed me that my instincts about format and audience were right, and gave me the confidence to keep going.

The broader lesson I took from this and want to share with others who were in my shoes: You do not need to have everything figured out before you start. The experiment is the figuring-out. Start small, stay consistent, and pay attention to what comes back.

Name What’s Stopping You

After the excitement of Tiny Experiments, weeks two and three of the program slowed things down in a way I found genuinely valuable. Week two was about Limiting Beliefs, the internal blocks that stop so many of us from putting ourselves out there. Week three was about identifying your Three Core Themes as a thought leader.

Both of these required sitting quietly and doing real thinking. People underestimate how useful that kind of structured self-examination is. A lot of people who want to do something creative or communicative are circling a block they haven’t named yet. Naming it doesn’t automatically dissolve it, but it does mean you can start working with it rather than just around it.

For the themes exercise, I had to get specific: what was I actually trying to achieve? Eventually, my answer was that I wanted to be a changemaker who inspires people to build crisis-resilient communities. That was still broad, and the exercise pushed me to get more concrete. I really had to think about what that actually looks like in practice, who I’m speaking to, and what thread connects everything I want to create.

If you’re looking for some structure to start this process on your own, I’d encourage you to push yourself to answer these three questions:

• What are you trying to achieve by creating thought leadership?

• What’s stopping you from going toward it?

• What are the two or three themes at the center of what you most want to be sharing about?

What Has Quietly Changed for Me

I want to be honest about something that surprised me: the program changed how I feel about speaking up.

I’m becoming more confident in putting my views out there, whether in writing, in doodles, or when I’m speaking aloud. I can feel myself slowly blossoming into the kind of person who speaks, not just someone who thinks. My mother always believed I had that in me. I’m starting to believe it, too.

I think this is one of the less-advertised benefits of doing any kind of consistent thought leadership work: it compounds. When you put something into words on a page, for example, it becomes easier to say out loud. When you draw something, you understand it better. When you share something publicly and survive the vulnerability of doing so, the next time is slightly less scary. The different modes of communication reinforce each other.

Where Things Stand Now: New Projects and New Momentum

When I look at where I am coming out of this program versus where I started, the difference is concrete.

The most exciting development: I have a live workshop confirmed in Singapore. It’s open to the public and it will be my first real in-person engagement with children. If it goes well, the goal is to use those connections to scale up into actual schools and educational institutions. This is a first step, and it feels significant.

Alongside the workshop, I’m actively reaching out to schools, educators, and institutions to figure out how to bring my doodles into school curricula and get my live programming into classrooms. Those collaborations are still developing, but the direction is clear: I want the doodles to have a life inside formal education, not just on social media. LinkedIn has been a useful starting point for building visibility, but it’s obviously not where I’m going to reach kids. Getting into schools is the real goal, and that’s so much closer now.

And then there’s my graphic novel. This is a project I’m genuinely excited about, and it signals an expansion of my audience beyond children to young adults and adults more broadly. The themes I’m exploring are the ones I think are most urgent right now: AI, energy, and the shape of society as these forces collide. I’ve started writing it the old-fashioned way, pen in notebook, and something about that process has opened up my thinking in a way that typing doesn’t. The ideas are flowing.

All of these threads (the workshop, the educator collaborations, the graphic novel, the ongoing doodles) are still taking shape. But they are real now in a way they weren’t six weeks ago.

The TL4H program didn’t hand me any of this. What it did was give me the clarity, the structure, and the confidence to go get it.

For Anyone Who Doesn’t Know Where to Start

If someone came to me and said they had no idea what thought leadership was or whether it was for them, here is what I would tell them:

A thought leader is simply someone who can gather people and make them want to listen, whether through their words, art, or presence. There is no single type. There are translators, storytellers, connectors, visionaries, and many others. Find where you fit in that range, and you’ll have your starting point.

Then, don’t skip the inner work: figure out what you’re trying to achieve, identify what’s genuinely blocking you, and get clear on your themes.

Only after you do that does it make sense to start thinking about platforms, content strategy, or workflow (the topics we covered in the second half of the TL4H program). The outer architecture is only as useful as your inner clarity behind it.

And then, start something small. Today, if you can.

Kruthika Eswaran is a climate communicator and creator of climate-focused doodles aimed at making science accessible to children (and the adults in their lives). She is currently developing a graphic novel exploring the intersections of AI, energy, and society. You can follow her thought leadership on LinkedIn and Instagram.

What Structure Makes Possible

“The structure made the difference” is the through-line across so many stories from our first cohort. Not one person came in already knowing how to do this. They came in with important work that was stuck in silent mode, and a nagging sense that they could be doing more to help their work reach the people who needed to hear it.

They left with clarity, a plan, and in several cases, work already published and in motion.

By the end of six weeks, TL4H cohort members had launched newsletters, started building podcasts and YouTube channels, written for the Climate Drift newsletter, and, like Kruthika, established collaborations they hadn’t yet conceived of when they first signed up.

Post-program feedback from the first cohort tells the story. Participants gave TL4H a 9.2 out of 10 overall rating. One described it as a program that takes you “from 0 to 10.” Multiple others said it “exceeded expectations.”

The Second Cohort of Thought Leadership for Humans Starts June 1

We’re forming the second cohort of TL4H now, and it launches Monday, June 1, inside Climate Drift.

We’re looking for climate founders, operators, researchers, practitioners, and communicators who are ready to stop carrying their ideas alone, and find out what becomes possible when they finally have the structure to share them.

Here’s what six weeks in TL4H gets you:

• A complete curriculum built around the specific psychology and strategy of thought leadership for people doing mission-driven work. Not generic content advice. Not a plug-and-play framework that strips out your voice. A structured practice designed around who you actually are and what you’re actually trying to say.

• Weekly live sessions with guest experts who have built real audiences, written books, and raised funding through their public thinking (and who will engage directly with your work in real time, not just present at you).

• A cohort of peers who understand the urgency of what you’re building. The community inside TL4H is one of its most-valued features. In post-survey feedback, participants named their cohort members again and again as a key part of what made the six weeks so transformative.

• Async writing and strategy feedback from Katie and your peers, so you can move through the program at your own pace as you balance your busy schedule.

And, because we all know that the hardest part is starting, you will publish something in Week 1. Not when you feel ready. Week 1.

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• has more ideas than output,

• suspects your visibility gap is costing you real opportunities, and

• is allergic to self-promotion (but is starting to see that staying quiet has a real cost, too).

You don’t need to already see yourself as a thought leader. Kruthika didn’t. She just needed structure, and a nudge to start something small.

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Hey there! 👋
Skander here.

$22 billion across 149 deals. March 2026 was the biggest month we’ve tracked this year.

Jarek’s latest Follow the Money breaks down where the capital actually went, and the regional splits tell you more than any macro forecast could.

🇺🇸 North America: $7.3B, almost entirely concentrated in batteries, nuclear, and geothermal. The U.S. is buying firm, dispatchable power for AI infrastructure. Valar Atomics ($450M), Fervo Energy ($421M), and a string of utility-scale BESS financings made that case loud and clear.

🇪🇺 Europe: $5.6B across 31 deals, anchored by Nscale’s $2B raise and the Andalusian Green Hydrogen Valley reaching FID. But the real signal is the mid-layer: iron fuel (RIFT), SMRs for district heating (Calogena), gene-edited bananas (Tropic), precision fermentation (Standing Ovation). Europe’s deep tech pipeline is producing first-of-a-kind closes.

🌏 Asia: $4.1B but 51 deals, the highest count of any region. China dominated the large rounds (Galaxy Universal Robotics at $344M, Zeron at $165M), India filled the mid and small layer with EV, solar, and climate fintech.

A few patterns worth flagging: AI-enabled climate solutions showed up in 15 separate raises. Robotics got its own tracking category for the first time, with five investments, mostly in China. And AFOLU had its strongest month of the quarter, led by Halter doubling its valuation to $2B.

🌊 Jarek breaks it all down below, region by region, theme by theme.

But first: Who is Jarek?

Jarek Dmowski is a global transformation leader who partners with high-growth companies with positive climate impact. He combines industry and climate finance expertise with a strong track record of driving growth—across PE/VC-backed scaleups, ABN AMRO, and BCG.

He scaled a data-driven technology company ~2.5x to ~$25M in revenue and led post-merger integrations that enabled ~6x accelerated growth. At a global financial institution, he spearheaded a $2B capital reallocation toward new energy and mobility. He also developed a comprehensive climate plan that translated the Paris Agreement into actionable targets across sectors and established a $250M program to drive efficiency gains and reduce emissions at an energy utility.

Jarek is passionate about how the climate transition reshapes economies and business models, creating significant opportunities for multi-country growth and impact.

Follow the Money - March 2026

by Jarek Dmowski

Welcome to the next edition of “Follow the Money” - a monthly briefing on the capital flows shaping the climate transition.

March wrapped up a busy Q1, and the first quarter of 2026 is officially in the books. We tracked 149 climate-related investment deals totaling ~$22.0 billion in March - marking the highest monthly volume we have recorded so far this year.

Where did money flow in March 2026?

Explanation of the approach and source data: The investment list was developed based on disclosures, newsletter monitoring and review of climate news. Although not exhaustive, 149 climate-related investment deals were tracked-amounting to roughly $22 billion (all data in US$), covering all continents and different life stages of companies and development finance programs. Data skew toward early-stage companies and investments, as well as development financing programs. We are continuously working to expand the data sources and coverage of investments.

So, where did the money flow in March 2026?

• Regional distribution was led by North America with ~$7.3B across 32 deals, followed closely by Europe (~$5.6B, 31 deals) and Asia (~$4.1B, 51 deals - the highest deal count by far)

• Energy continues to dominate, accounting for ~$13 billion across 59 deals - by far the largest category month after month. Adaptation & resilience emerged as a clear #2 (~$3.8 billion, 15 deals), followed by Industrial, Transport, and AFOLU. Buildings and Climate Data remained undercapitalized (~$0.1B).

• AI’s influence is becoming structural. Fifteen AI-enabled climate solutions raised capital in March, reinforcing the role of artificial intelligence as an accelerator of deployment, optimization, and cost reduction across sectors.

• Robotics, a new tracked category, saw five investments in March, particularly in China, underscoring its growing industrial and climate-adaptation roles.

• Venture capital activity remained strong. We tracked 57 venture and growth investments (Seed through Series F), with an average round size of ~$92 million. Asia led with 24 deals, followed by Europe and North America with 17 and 13 deals, respectively.

• Public and development finance continued to anchor the market. Multilateral institutions and government programs supported ~$6.8 billion across ~33 deals, with a strong focus on infrastructure and adaptation.

Let’s now dive deeper into 2026 watchlist themes (please refer to our December perspective for more details) and across regions to highlight technologies with real scaling potential over the next 3-5 years.

Which (of our 2026) themes were most strongly visible in March?

U.S: Nuclear and Geothermal vs. RoW: Solar and Wind

March continued to support this theme. In the U.S., the two largest non-project-finance cleantech equity rounds of the month were Valar Atomics ($450M advanced nuclear) and Fervo Energy ($421M enhanced geothermal), while solar and BESS also attracted financing (Primergy/Quinbrook and Zelstra projects). Outside the U.S., the biggest renewable cheques were EIB Sub-Saharan Africa ($1.15B), Envision Energy ($600M SLL, wind/storage), Clean Max Enviro ($364M solar+wind IPO, India), and ACEN Corp India ($81M onshore wind).

Not a single non-U.S. advanced-nuclear or geothermal round of similar scale. The pattern is structural now: the U.S. is paying up for firm, dispatchable, capital-heavy electrons to run AI factories; everyone else is paying down for the cheapest levelized-cost MWh they can build.

“Solarpunk” Continues

March was a strong month for “EV beyond cars.” Allfleet/PMI Electro ($310M, India, buses) and Zeron ($165M, China, heavy trucks) anchored the commercial-vehicle layer; Euler Motors ($77M, India, 3-/4-wheel last-mile) continued to scale; Candela ($34.7M, Sweden, hydrofoiling ferries), Vertical Aerospace ($50M immediate, UK, eVTOL), Arc ($50M, USA, electric marine), Zeno ($25M, Kenya, e-motorcycles) and Battery Smart ($7.4M, India, 2W/3W swapping) covered water, air and two-wheel mobility.

On the residential side, cheap batteries and electrification kits kept scaling - Photoncycle ($17.5M, Norway, seasonal H₂ storage for households), HELIUP ($18.6M, France, lightweight rooftop solar), Ecofy ($42M, India, green NBFC lending for rooftop and EVs), and GSIS Ginhawa Solar ($218M, Philippines, sovereign rooftop-solar loan pool).

Mid-stage, CapEx-intensive cleantech faces the “Valley of Death”

March 2026 highlighted several capital structures successfully navigating this perilous valley. The key to unlocking capital for TRL 4-5 technologies lies in securing advanced offtake agreements and intelligently blending non-dilutive government grants with private equity. RIFT’s €113.8 million raise for its iron fuel technology was heavily anchored by a €30.7 million grant from the EU Innovation Fund, which de-risk the subsequent private capital injection from regional development funds and impact investors. Fervo Cape Station ($421M non-recourse project finance) was the first enhanced-geothermal facility to reach utility-scale project financing. Electra, developing a low-temperature electrochemical process for manufacturing green iron, successfully utilized a $30 million venture debt facility from J.P. Morgan.

AFOLU - adaptation, robotics, alt-protein

AFOLU had its strongest month of Q1. Halter ($220M, New Zealand, AI virtual fencing) doubled its valuation to $2B. Tropic ($105M, UK, gene-edited bananas) anchored climate-resilient crops. TARGAN ($100M, USA, poultry AI) and Captain Fresh ($31M, India, seafood) covered animal-protein productivity. Standing Ovation ($34.2M, France, casein) was one of the cleaner alt-protein closes of the year. PlasmaLeap ($20M, Australia, plasma ammonia, Gates Foundation + Yara + Investible), Solugen ($50M, Canada, manure-to-fertilizer) and Sistema.bio FarmCarbon ($53M, Global) extended the smallholder-and-circular-fertilizer stack.

Robotics and Climate Tech

In March 2026, massive capital inflows poured into (mostly) the Chinese robotics ecosystem. We tracked Galaxy Universal Robotics ($344M, CATL battery-factory humanoids), Robot Era ($138M, humanoid L7), Kunwei ($13.8M, force sensors for humanoids), AgriPass ($7.5M, Israel, weed-control robotics) and Skye Air ($9M, India, BVLOS delivery drones). In many cases, the climate value-add is indirect - higher-velocity clean-manufacturing throughput, less labour-constrained.

Europe

Europe recorded ~$5.6B across 31 deals in March 2026, blending two mega-deals (Nscale, Andalusian Green H₂ Valley) with a deep, mid-sized layer of first-of-a-kind deep-tech - iron fuel, SMRs, lightweight solar, seasonal hydrogen storage, precision fermentation, gene-edited crops.

Selected March financings:

• Nscale (UK / Norway) - $2.0B Series C led by Aker ASA. Hydro-powered AI hyperscaler; board adds Sheryl Sandberg and Nick Clegg. $14.6B valuation. This is Europe’s most ambitious answer to the U.S. data-center build-out - and the first pure-play European AI hyperscaler that looks investable at scale.

• Andalusian Green Hydrogen Valley (Onuba phase) (Spain) - €1B+ (~$1.2B) FID. Moeve, Masdar and Enalter confirmed the first-phase construction of the Huelva green H₂ corridor - one of a handful of European mega-projects actually reaching FID rather than slipping.

• RIFT (Iron Fuel Netherlands) (Netherlands) - €113.8M (~$131M) (€83.1M Series B led by PGGM + €30.7M EU Innovation Fund). World’s first commercial iron-fuel facility for industrial heat - zero-CO₂ high-temperature process heat by burning iron powder and regenerating it with clean electricity. If this works at FOAK scale, it rewrites the playbook for decarbonizing heavy industry.

• Calogena (France) - ~€100M (~$114M) combining a €48M France 2030 grant with private equity from Groupe Gorgé, SNEF and Banque des Territoires. 30MWt SMR purpose-built for district heating rather than power - a smart design choice that dodges the levelized-cost-of-electricity fight entirely.

• Tropic (UK) - $105M Series C co-led by Forbion Bioeconomy Fund and Corteva Catalyst, with Just Climate and Temasek alongside. Gene-edited non-browning, TR4-resistant bananas - the first new commercial banana variety in 75 years, and a template for climate-resilient staple crops.

• Candela (Sweden) - €30M (~$34.7M). Electric hydrofoiling P-12 ferries consuming 80% less energy than conventional vessels; IFC joining with €8M. Funds a second manufacturing facility in Poland. 65+ vessels on order.

• Standing Ovation (France) - €30M (~$34.2M) Series B co-led by Bpifrance’s Ecotechnologies 2 and Crédit Mutuel Innovation. Precision-fermentation casein - dairy-identical protein with a much lower CO₂ footprint.

North America

North America recorded ~$6.8B across 31 deals - the largest regional dollar total - driven by a tight cluster of themes: utility-scale batteries, advanced nuclear, geothermal, and the AI-data-center-power stack.

Selected highlights:

• Ayar Labs (USA) - $500M Series E led by Neuberger Berman with ARK Invest, Insight Partners, QIA, Sequoia Global Equities, AMD Ventures and NVIDIA alongside. Co-packaged optics that drastically cut energy per bit in AI data-center interconnects. Valuation: $3.75B. The round that finally puts the “data-center power bottleneck” thesis into the mega-round bucket.

• Valar Atomics (USA) - ~$450M ($340M equity + $110M debt). Clusters of small high-temperature gas-cooled reactors for AI data-center firm power. Backed by Palmer Luckey (Anduril founder), Shyam Sankar (Palantir CTO) and Snowpoint Ventures. $2B valuation. This is the advanced-nuclear-meets-defense-tech archetype crystalizing into a category.

• Fervo Energy - Cape Station Phase 1 (USA) - $421M non-recourse project finance arranged by RBC. 100MW enhanced geothermal scaling to 500MW; PPAs with Southern California Edison, Shell Energy and California CCAs. First EGS facility to actually reach utility-scale project financing - a milestone, not a demo.

• EnerVenue (USA) - $300M Series B extension led by Full Vision Capital. Metal-hydrogen battery storage - 30,000-cycle lifespan, no degradation. Funds manufacturing scale-up in the U.S. and Changzhou, China. A credible LDES contender that Li-ion can’t easily match on durability.

• Frore Systems (USA) - $143M Series D at a $1.64B valuation. AirJet thermal chips cooling AI accelerators and edge devices - another “thermal stack” bet riding the AI power-density curve.

• TARGAN (USA) - $100M committed facility ($30M initial tranche) from Symbiotic Capital. AI-powered feather-sex identification for poultry hatcheries at 30M+ chicks/week - an unglamorous but measurably emissions-reducing bit of animal-protein infrastructure.

• Cultivo (USA) - $60M capital-deployment partnership with Octopus Energy Generation (total partnership $100M). Nature-based carbon removal across 650,000+ acres of regenerated grasslands; targeting 9M tCO₂ removal over 30 years. One of the cleanest corporate off-take structures we’ve seen in the NbS space.

Asia

Asia-Pacific recorded ~$4.3B across 59 deals - by far the highest deal count of any region, with China anchoring the large deep-tech rounds and India dominating the mid/small layer through EV, solar and climate fintech.

Key highlights from Asia in March:

• Clean Max Enviro Energy Solutions (India) - ₹3,100 crore (~$364M) IPO. India’s largest C&I renewables platform (2.54 GW operational, 531+ corporate customers). A cleaner proxy than ReNew for the underlying Indian C&I demand curve.

• Galaxy Universal Robotics (China) - RMB 2.5B (~$344M) growth round with the National AI Fund (Phase III) making its first embodied-AI investment. Galbot S1 humanoids now operational inside CATL battery factories. Climate relevance: clean-energy manufacturing productivity.

• Allfleet (PMI Electro) (India) - up to $310M growth equity from KKR (Global Climate Transition Strategy). Platform to deploy 5,000+ electric buses across India - KKR GCT’s first India investment and one of the largest emerging-market e-bus deals on record.

• Zeron (China) - RMB 1.2B (~$165M) growth round co-led by NIO Capital. Electric heavy-duty trucks for long-haul - the “Tesla Semi” thesis, Chinese-flavored.

• Robot Era (ROBOTERA) (China) - RMB 1B (~$138M) strategic round. L7 bipedal humanoid + direct-drive dexterous hand. 50% of orders from international markets; valuation >RMB 10B.

• Dali Times Energy (China) - RMB 1B+ (~$116M) project investment. Wide-temperature-range, high-C-rate specialised lithium and semi-solid-state / solid-state battery production base. 2 GWh of planned annual capacity. Yunnan’s 2026 priority project.

• Vertical Aerospace (UK-listed, covered here for Asia-relevance as the eVTOL category leader) - $50M immediate equity + up to $850M financing package. Valo eVTOL aircraft for urban air mobility - first piloted horizontal flight transition completed April 2, 2026.

• Euler Motors (India) - INR 437.5 Cr (~$47M) Series E equity + INR 250 Cr (~$30M) debt. Electric 3- and 4-wheel commercial vehicles for last-mile logistics. 15,000+ vehicles on road. Lightrock and Hero MotoCorp lead.

RoW

RoW (Africa, South America, Australia) recorded ~$6.2B combined across 35 deals - roughly a quarter of March’s total volume. Across South America, Africa, and other emerging markets, the investment landscape remains primarily anchored by the interventions of MDBs and DFIs, alongside evolving blended finance mechanisms, while the flow of commercial private capital remains constrained.

Selected highlights:

• Uruguay Climate Resilience Program (Uruguay) - $980M DFI loan from CAF. Transformation of vulnerable urban areas and public transport in Montevideo; flood prevention and green mobility. One of CAF’s largest single-country climate commitments of the cycle.

• ASCENT-GREEN (GCF FP291) (21 African countries) - $250M. The largest single project approved at GCF B.44. Financing for distributed renewables, clean cooking and productive-use energy across Eastern and Southern Africa.

• Investec Green Housing Finance (South Africa) - $200M DFI loan from IFC. 7-year senior unsecured facility supporting EDGE-certified green buildings plus a $3.8M UK-MAGC incentive to offset certification costs. Investec targets £18B (~$24B) in sustainable financing by 2030.

• Ecuador Biodiversity Bond (Ecuador) - $120M bond issued by Banco Bolivariano with IFC ($50M), IDB Invest ($50M) and FMO ($20M). First biodiversity-labeled bond in Ecuador, largest in Latin America. Covers productive land use, sustainable marine, forestry and ecotourism.

• ATOME Villeta Green H₂ Fertiliser Plant (Paraguay) - up to $95M (EIB tranche of a $420M package). Industrial-scale low-carbon nitrogen fertiliser using green hydrogen - 260,000 tpa CAN. IFC, IDB Invest, FMO and GCF alongside.

• Zeno (Kenya) - $25M Series A ($20.5M equity + $4.5M debt) led by Congruent Ventures with Active Impact and Lowercarbon. Full-stack e-motorcycle + battery-swap platform for East Africa. 800+ bikes, 150+ swap stations, 25,000+ waitlist.

• Halter (New Zealand) - $220M Series E led by Founders Fund with Blackbird, DCVC, Bond and Bessemer. AI-powered virtual fencing for livestock; $2B valuation, doubled in under a year. A rare climate-agtech unicorn with commercial traction in the U.S.

What will we observe in 2026?

Q1 set the tone: capital is concentrating around firm power in the U.S., mass-market electrification in Asia, policy-backed project finance and deep-tech in Europe, and blended adaptation finance in the Global South. March did not break the pattern - it reinforced it, and added sharper industrial-heat and robotics signals.

We will be watching whether the themes identified in December continue to deepen:

• U.S.: Nuclear and Geothermal vs. Rest of World: Solar and Wind

• “Solarpunk” Momentum - electrification beyond cars, powered by cheap batteries

• Dual-Use Innovation: Climate + Defense, Supply Chain, Compute

• CapEx-Intensive Mid-Stage Tech and the “Valley of Death”

• Industrial Heat Electrification

• Nature-Based Solutions for Carbon and Biodiversity

• AFOLU Innovation - including climate adaptation, robotics, and alternative proteins

• The Rise of Climate Robotics

Stay tuned for next month’s edition as we continue to follow the capital shaping the climate transition.

Hey there! 👋

Skander here.

We listened to the full Stepchange Show episode on the US electricity grid so you didn’t have to.

OK fine, you should still listen to it. It's incredible.

When Ben from the show asked us to join as an expert and give feedback on the research, we were happy to oblige. The result is one of the best pieces of energy content produced this year.

👉 Listen to the full episode here

But if you want the cocktail party version, the investor dinner version, or just the “blow your colleague’s mind on Slack” version, here are 100 facts that stuck with us.

From amber-rubbing ancient Greeks to Enron traders yelling “burn, baby, burn,” the grid’s story is wilder than most fiction.

🌊 Let’s dive in

100 Fun Facts About the Grid

Origins

1. The word “electricity” comes from the Greek word for amber, elektron, because rubbing amber on cloth made it attract feathers.

2. Benjamin Franklin didn’t fly a kite to get struck by lightning. He flew it to prove lightning was electrical. Within months, lightning rods were appearing on buildings across Philadelphia, Boston, London, and Paris.

3. Franklin coined the terms “positive” and “negative” charge and called an array of connected Leyden jars an “electrical battery,” the first use of that word in an electrical context.

4. The first battery was born from a feud over dead frogs. Luigi Galvani believed frog legs twitched because of “animal electricity.” Alessandro Volta disagreed, built a stack of zinc and copper disks separated by salt-soaked cardboard, and created a continuous flow of electricity in 1800. No dead frogs required.

5. Michael Faraday started his career as a bookbinder. He read the scientific texts he was supposed to bind, impressed Humphry Davy with beautifully bound lecture notes, and got hired as Davy’s lab assistant.

6. Faraday’s 1831 breakthrough (moving a magnet through a coil of wire to generate current) is the operating principle behind every power plant on Earth today.

7. In 1809, Humphry Davy created an arc of electricity between two carbon rods so bright that audience members had to shield their eyes. It was the first time electricity produced something useful.

Edison & Pearl Street

8. Edison’s first customer for electric light was J.P. Morgan, who had a private generator installed in the cellar of his brownstone. It was so loud it shook the walls and terrified the neighbors.

9. Edison went to the press in October 1878 to announce that electricity would light homes, heat rooms, and cook food. He didn’t even have a working bulb yet. His announcement crashed gas stocks on both sides of the Atlantic.

10. The British Parliament investigated Edison’s claims and concluded his dreams were “unworthy of the attention of practical or scientific men.”

11. Edison’s team tested everything for a lightbulb filament: platinum, bamboo, even human beard hair. A carbonized cotton thread finally burned for 14.5 hours.

12. On September 4, 1882, Edison’s Pearl Street Station in Manhattan lit up 400 lamps across a one-square-mile radius. The New York Times reported a “soft, mellow light, grateful to the eye.”

13. Edison’s team had to invent everything from scratch: the wiring, insulation, junction boxes, meters, safety fuses, and even the way light bulbs screw into sockets.

14. Edison priced electricity at the same cost per hour as gaslight on purpose. If the light was better and the price identical, gas companies would have no argument.

Tesla & the War of the Currents

15. Nikola Tesla had his breakthrough in a Budapest park in 1882, allegedly mid-poem. He grabbed a stick, started drawing in the sand, and nearly wept. “I have solved the problem. I can now die happy.”

16. Tesla’s AC motor had no brushes, no commutator, no physical contact between moving parts. It worked through rotating magnetic fields, like a maglev train for electricity.

17. When Tesla arrived in New York in 1884, he had 4 cents, a book of poetry, and a letter of introduction to Edison. Edison dismissed AC immediately as “the executioner’s current.”

18. After leaving Edison and being pushed out of his first company by investors who wanted arc lighting (not revolutionary motors), Tesla went from premier inventor to ditchdigger. Literally.

19. Over one year, Tesla filed more than 40 patents covering the motor, generator, transformer, and transmission system for AC. He had blueprinted an entire alternate electrical universe in a single sprint.

20. George Westinghouse recognized the transformer’s power immediately because of his background in gas pipelines: pump something at high pressure, regulate it down locally. Same idea, different medium.

21. Edison’s anti-AC propaganda included an 84-page pamphlet titled “Warning,” demonstrations where dogs were electrocuted on stage, and lobbying for the electric chair to use AC so people would associate it with death. He tried to make “Westinghoused” a verb meaning “to be killed by electricity.”

22. AC won because of copper. AC central stations required one-third the copper of DC systems. In an era when copper costs could make or break profitability, the math was fatal to DC.

23. In one year of selling AC systems, Westinghouse built 68 central stations. Edison, after eight years of DC, had only 121.

24. J.P. Morgan merged Edison’s company with a competitor without telling Edison until the day before. The new company was called General Electric. Edison’s name didn’t make the cut.

Niagara & the First Grid

25. In 1893, Westinghouse lit the Chicago World’s Exposition with the largest AC station ever built, 25 times larger than anything in existence. 27 million people walked through. Within a year, AC had captured 50% of the electricity market.

26. 103 of America’s richest men pooled $2.6 million to harness Niagara Falls. Early proposals for how to do it included rope, water pressure, and air pressure. Nobody was sure.

27. In 1896, electricity flowed 26 miles from Niagara Falls to power Buffalo’s streetcars. It was the first proof that long-distance AC transmission worked at commercial scale.

28. Niagara’s first plant produced 11 megawatts, nearly 20 times what Edison’s Pearl Street Station had managed.

29. Cheap hydropower from Niagara turned aluminum from a precious metal (more expensive than gold, reserved for Napoleon’s most honored dinner guests) into a commodity (under $1 per pound). Smelting one ton of aluminum takes enough electricity to power a home for over a year. Industry joke: aluminum is just congealed electricity.

Insull’s Genius

30. Samuel Insull was Edison’s personal secretary, matching the boss’s four-hour sleep schedule. When Edison needed copper at 2 a.m., Insull placed the order. He grew Edison’s Schenectady factory from 200 to 6,000 employees.

31. Insull turned down a top job at the newly formed General Electric and instead took a position at Chicago Edison, a company worth less than a million dollars at a third of the salary. Everyone thought he was crazy.

32. When Insull arrived at Chicago Edison, the plant was running at 5.5% capacity. He told his board the only question was when they’d be bankrupt.

33. Insull’s solution: find customers who needed power at different times. Streetcars peaked during morning and evening commutes. Meatpackers needed 24/7 refrigeration. Skyscraper elevators ran during business hours. He even invented “signing as a service,” leasing electric signs for free so businesses would pay monthly electricity bills.

34. By 1910, Insull had pushed Chicago Edison’s capacity utilization from 5.5% to over 50%, the highest in the nation. He’d solved the puzzle of time.

35. Insull cut electricity rates from $0.20 to $0.025 per kilowatt-hour, a nearly 90% drop in 12 years. His competitors thought it was suicide. His customer base grew from 5,000 to 200,000.

36. In 1902, generating one kilowatt-hour required about seven pounds of coal. Thirty years later, Insull’s system needed just over one pound. He passed the savings to consumers instead of boosting profits.

37. Insull is essentially the inventor of the regulated monopoly. He went to Progressive Era reformers and said: give me exclusive territory, and you can regulate my rates and profits. By 1915, 41 states had utility commissions.

38. Insull’s bet on the unproven steam turbine transformed the industry overnight. His first unit at Fisk Street Station in Chicago produced twice as much power as any steam engine ever built. Within a year, utilities worldwide were ordering turbine capacity.

The Home Gets Wired

39. In 1915, your home’s “electrical panel” was a wooden board with a knife switch (a literal blade of copper you slammed down) and a couple screw-in fuses.

40. There were no wall outlets. Power went to ceiling light sockets. To use a new GE toaster in 1915, you unscrewed your light bulb, screwed in an adapter, ran an extension cord to your kitchen, and ate toast in the dark.

41. If you blew a fuse and had no replacement, you might stick a penny in the fuse box to bridge the connection, overheat your knob-and-tube wiring, and burn your house down.

42. It took nearly 30 years from the introduction of household electricity to get wall outlets and circuit breakers that let you run a toaster, vacuum, radio, and iron without blowing fuses.

43. In 1907, about 8% of Americans had electricity. By 1920, 35%. By 1929, 70%. That’s smartphone-adoption speed.

44. In the 1920s, GE, Westinghouse, and every utility ran ads in Ladies’ Home Journal and Good Housekeeping targeting women, promising electric irons and washing machines as “your willing electrical servant.”

45. Consumer installment credit was pioneered to sell electrical appliances. A $150 washing machine on credit for a few dollars a month.

Rural Electrification & the New Deal

46. In 1934, only 10% of American farms had electricity. A family 50 miles outside LA hauled water by hand, washed clothes manually, and went to sleep at sundown, while a family in the city had a toaster, washer, and radio.

47. Stringing power lines to farms cost $2,000 per mile. Private utilities needed 3-4 customers per mile to break even. Farming regions had 1-2.

48. Roosevelt’s Rural Electrification Administration used 25-year loans at 2-3% interest and let farmers form cooperatives. The REA slashed rural line costs from $2,000 to $600 per mile using standardized designs and local labor.

49. In just two years, 350 cooperative projects across 45 states electrified 1.5 million farms. Today, rural co-ops still serve 42 million Americans across 47 states.

50. The Tennessee Valley Authority was so enormous that private utilities filed 38 lawsuits trying to block it between 1936 and 1939.

War & Interconnection

51. Building one B-17 bomber required massive amounts of aluminum. Between 1939 and 1944, aluminum and magnesium production alone consumed one-seventh of all US electricity.

52. Three-quarters of TVA’s power went directly to the war effort: smelting aluminum for bombers and producing nitrates for munitions.

53. Oak Ridge, Tennessee, was a secret city of 75,000 people built from scratch to enrich uranium for the atomic bomb. This small city drew as much electricity as New York City. The TVA’s own chairman didn’t know what the power was being used for until mid-1945.

54. The government forced utilities to interconnect during WWII. Consumption rose 60% during the war, but generation capacity only needed to grow 25%, because interconnection unlocked load diversity and coordinated dispatch.

55. Texas interconnected its utilities in 1941 to support Gulf Coast war production but kept the grid entirely within state borders to avoid federal jurisdiction. It’s been doing its own thing ever since.

The Postwar Boom

56. In 1956, 300 utilities and 180 appliance manufacturers launched the “Live Better Electrically” campaign. Their spokesman? Ronald Reagan, touring his all-electric Pacific Palisades home on GE Theater.

57. A GE internal memo stated: “By Thanksgiving, there should not be a man, woman, or child in America who doesn’t know you can live better electrically.”

58. TV ownership went from 10% in 1950 to 90% in 1960. Americans watched the electric future on an electric device.

59. By 1970, a million homes had been certified as “Gold Medallion Homes”: fully electric, no gas lines, no oil tanks.

60. Average household electricity consumption went from about 1,000 kilowatt-hours per year in 1945 to nearly 5,000 by the mid-1960s. Prices fell nearly 60% in real terms over the same period.

61. Between 1950 and 1963, American utilities built 80,000 miles of transmission lines. Enough to wrap around the Earth three times.

The Physics of Synchronization

62. Every AC generator on a given interconnection spins at exactly 60 Hz (3,600 RPM). The turbines at Hoover Dam and Grand Coulee Dam are physically locked in electromagnetic sync as they spin, like synchronized swimmers across thousands of miles.

63. When you flip a light switch, the drag is felt electromagnetically by turbines potentially a thousand miles away. That braking force triggers governors to open more fuel valves within milliseconds.

64. If frequency drops from 60 Hz to even 59.3 Hz, the grid is in serious trouble. During Winter Storm Uri in Texas, operators were less than five minutes from a complete grid collapse.

65. The three US grids (Eastern, Western, and ERCOT/Texas) emerged by the mid-1960s and still exist today. Texas keeps its grid within state borders to avoid FERC oversight.

66. The grid wasn’t planned top-down. There is no blueprint for a continental-scale synchronized machine. It emerged through thousands of utilities forced to connect, one line at a time, until the whole thing became inseparable.

The Cracks

67. On November 9, 1965, a single relay tripped at the Niagara Falls power station. Within 12 minutes, 30 million people across eight states and Ontario lost power. 800,000 riders were trapped in New York subways.

68. That 1965 blackout led to the creation of NERC (National Electric Reliability Council), the industry’s attempt at self-regulation to preempt federal control.

69. Between 1971 and 1978, the cost of building a coal plant increased about 70% in real terms. Nuclear increased 140%. Of 253 nuclear plants ordered during the boom, almost half were canceled.

70. The Southern Company and other nuclear utility builders reportedly made more money going over budget than turning plants online, because cost overruns still went into the rate base earning guaranteed returns.

71. Drivers in Pittsburgh in the 1960s had to use windshield wipers in the middle of the day to clear away soot from coal plants.

72. The first Earth Day in 1970 drew 20 million people, the largest demonstration in American history at the time. Nixon signed the Clean Air Act and created the EPA.

73. Over 50 years, emissions of the six most common pollutants dropped about 80%, even while the economy tripled in size.

The Oil Shock & Conservation

74. In the 1960s and ‘70s, US utilities spent billions converting coal plants to oil. Then OPEC’s 1973 embargo hit. Oil prices quadrupled. The speed limit was dropped to 55 mph to save fuel.

75. President Carter went on TV in a cardigan sweater and told Americans to turn down their thermostats. “We must face the fact that the energy shortage is permanent.”

76. Interest rates hit 21%, crushing utilities that had financed nuclear plants on debt. Residential electricity prices tripled from 1970 to 1985. Industrial prices quadrupled.

77. Amory Lovins coined the phrase that still haunts utility executives: “The cheapest kilowatt-hour is the one that you never had to generate.”

PURPA & the Market Revolution

78. PURPA, the 1978 law that cracked the utility monopoly on generation, was born from a New Hampshire senator’s desire to help a trash-burning plant sell electricity. Utilities barely noticed. It changed everything.

79. California went wild with PURPA. In 1981, the state had 10 MW of grid-connected wind. By 1985: 100 MW. By 1990, California housed 85% of the world’s wind capacity and 95% of its solar.

80. When regulators asked Virginia for 1,000 kilowatts of independent generation, they got bids for 5,000 kilowatts from 53 different companies. PURPA was called “the Full Employment Act for economists.”

81. AT&T’s 1984 breakup proved you could smash a vertically integrated monopoly into pieces and the system could still work. Everyone asked: why not electricity?

82. Chile restructured its electricity sector in the 1970s using advice from “the Chicago Boys,” economists trained under Milton Friedman. The World Bank held it up as a model and exported it worldwide.

Enron & the California Crisis

83. California froze retail electricity rates at 6.7 cents per kilowatt-hour while deregulating wholesale prices. When wholesale prices spiked to 20 cents, utilities lost money on every customer.

84. Enron traders bought up transmission rights, claimed lines were congested (they weren’t), and collected payments to “free up” capacity that was never actually constrained. Strategies had names like “Death Star” and “Get Shorty.”

85. When a forest fire shut down transmission lines, Enron traders were overheard saying: “Burn, baby, burn. That’s a beautiful thing.”

86. Fortune named Enron “most innovative company” six years in a row, including 2001, the year it filed for bankruptcy. Arthur Andersen was involved in the fraud. Again.

87. California lost $40 to $70 billion in excess electricity costs during the crisis, a direct transfer of wealth from ratepayers to energy traders. PG&E declared bankruptcy. Governor Gray Davis was recalled from office.

Blackouts & the Modern Grid

88. In August 2003, overgrown trees touching a transmission line in Ohio knocked out power for 50 million people across eight states. FirstEnergy had completed only 17% of their scheduled maintenance that year, with a backlog of 11,000 items.

89. American power consumers average over five hours of outages per year. In Japan and Germany, the figure is about 10 minutes.

90. The number-one cause of blackouts in the world’s most advanced economy is the combination of overgrown vegetation, storms, and squirrels. Squirrels have shut down the NASDAQ twice.

91. In 2018, a one-inch cast-iron hook, installed in 1921 on a transmission tower in the Sierra Nevadas, snapped after 97 years. The Camp Fire killed 85 people, destroyed 18,000 structures, and wiped out a town. PG&E pled guilty to 84 counts of manslaughter.

92. PG&E had paid $5 billion in shareholder dividends in the five years before the Camp Fire while deferring maintenance. Post-fire inspections found 250,000 needed repairs.

China & the Global Contrast

93. In 1980, China’s entire grid capacity was 66 GW. America’s was 600 GW. China then compressed a century of electrical development into two decades, building the equivalent of one new medium-sized power plant every two weeks.

94. China has built over 40 ultra-high voltage transmission lines since 2009, some running at 1,100 kV DC and carrying power 3,000 kilometers. The US has zero.

95. In 2025 alone, China added 430 GW of new wind and solar capacity. The US added 63 GW of all technologies. China was operating at nearly seven times the pace.

96. 40% of global shipping exists just to move fossil fuels around.

Where We Are Now

97. Solar panels cost $76 per watt in 1977. Today: about $0.13. That’s a 99.8% cost decline. In 2023 alone, the world installed more solar than it did in the 63 years from 1954 to 2017.

98. The US grid runs at roughly 50% capacity. It’s sized for the worst hour of the worst day of the year. One analysis estimated $150 billion in potential savings over 10 years from better utilization alone.

99. In 2024, data centers consumed about 5% of US electricity. A Duke University paper found that if data centers accepted just one day per year of curtailed load during peak hours, the US could add over 75 GW of new data center capacity without building a single new power plant.

100. The US currently gets about 20% of its total energy from the grid. To keep pace with electrification of transport, heating, industry, and AI, that share needs to reach 40-50%. We need to build two or three more grids over the next 20 years. The grid’s story is just getting started.

     ---

This list was collected from the Stepchange Show’s “The Story of the Grid” episode. If you enjoyed these facts, listen to the full episode for the complete four-and-a-half-hour story.

And for more on the energy transition, the companies building it, and the capital flowing into it, subscribe to Climate Drift.

Subscribe now

Skander here.

You want to ship faster. You want to ship right. You want the kind of product discipline that let Amazon scale from nothing to one of the most valuable companies on the planet.

You’ve probably read the Working Backwards books. You’ve listened to the Bezos interviews. You’ve bookmarked the six-pager templates. And none of it has changed how you actually make product decisions, because a book can’t call you on your decision theater.

The methodology works. We’ve seen it. But copying Amazon rituals without a continuous feedback loop and someone who actually lived the process is how you end up with generic PRDs and the same bad decisions.

Scott Renda has spent 11+ years as a Principal at AWS, shipping products across AI infrastructure, edge computing, and data centers. He ran and participated in the Working Backwards process, dozens of times, at a scale most climate founders will never touch.

A few months ago, Scott came to us with a proposal: let’s build something that forces founders to be wrong sooner, on paper, when pivoting costs weeks instead of millions.

A forcing function with peer feedback from founders who actually want to ship, and direct coaching from someone who won’t let you pull punches.

Today, we’re introducing Working Backwards for Climate Founders: an 8-week program to ship fast & right.

Apply here

Here’s what we’re covering:
- Why most climate products fail at the business layer, not the science layer
- The six failure modes that kill climate startups before they scale
- How Amazon’s PR/FAQ methodology adapts to the specific physics of climate tech
- Why the fastest founders aren’t the ones who build first, they’re the ones who are wrong sooner

🌊 Let’s dive in, handing over to Scott Renda

But first, who is Scott?

Scott Renda has spent 11+ years at Amazon Web Services as a Principal Product Manager, where he led product and pricing strategy for hyper-scale AI infrastructure, architecting the training and inference clusters used by the world's leading foundational model providers, including Anthropic and OpenAI.

He launched AWS Wavelength (the world's first hyperscaler 5G Edge Cloud) and designed $100M+ partnership frameworks across AWS's infrastructure portfolio.

Before AWS, he served as Chief of Strategy, Policy and Communications at the White House, where he co-authored the US Federal government's first cloud computing strategy and oversaw $80 billion in annual Federal IT spend.

His career has been one long thread: deploying capital-intensive infrastructure at scale in deeply constrained environments. He now applies that lens to climate tech product strategy through Climate Drift.

Ship Fast, Ship Right

Hey there! 👋

Scott here. :)

The graveyards of climate tech are filled with products that worked. Worked in the lab. Worked at pilot scale. Worked on paper. Right up until they didn’t work as a business.

Most climate startups fail not because the science is wrong, but because product decisions get locked in too early, with irreversible capital consequences. By the time founders discover the mistake, it’s too late. This essay is about why, and what to do about it.

Let me put the pitch first:
Working Backwards for Climate Founders is an eight-week cohort program that teaches you to surface product assumptions before they harden into capital commitments.

We adapt Amazon’s Working Backwards and PR/FAQ methodologies (proven at AWS from zero to billions in revenue) for the unique challenges of climate tech.

Participants will learn to pressure-test their products against the specific failure modes that kill climate products: variability that destroys bankability, cost parity traps, workflow friction, and the three-way collision between manufacturing, supply chain, and operational readiness.

The program isn’t about writing better documents. It’s about being wrong sooner, on paper, when pivoting costs weeks instead of millions. Because in climate tech, the decisions that matter most are often one-way doors.

Apply here

The Conviction Problem

Climate founders operate with a different kind of confidence than typical startup founders. They’ve often spent a decade building expertise in a specific domain. They’ve done thermodynamics, materials science, and systems analysis. They know their solution needs to exist. This conviction is essential, as you cannot build hard things without it. But it creates a failure mode: the belief that technical merit alone will carry a product to market.

A scientist who has spent five years optimizing an electrolyzer’s efficiency at bench scale can easily confuse “this technology should exist” with “customers will buy this specific product.” The lab metrics become the product definition. The breakthrough becomes the value proposition. But industrial or enterprise buyers don’t purchase physics. They purchase solutions to operational problems with predictable economics. The gap between those two frames is where products go to die.

Where Climate Tech Products Actually Fail

Let me be specific about the failure modes, because they’re more mundane than most founders expect. These modes rarely appear alone. But they are distinct, and fixing one does not fix the others.

The planet-as-customer fallacy. Carbon removal, clean energy, and circular economy ventures all start with global impact as the goal. The problem: “the planet” has no procurement budget. If your sales pitch leads with avoided emissions rather than operational value, you’re asking buyers to pay more for doing good. They won’t. The product must deliver bottom-line value, whether cost savings or operational gains, with sustainability impact as a built-in consequence. If your business model breaks when subsidies expire, you’ve built a policy bet, not a product.

The Variability Trap. Climate products routinely demonstrate consistent performance in controlled settings, only to experience unpredictably in the field. The issue isn’t that a product wears out, it’s that you can’t predict how or when because the degradation curve isn’t reproducible. One unit performs as promised while an identical unit fails twice as fast under seemingly similar conditions. Lab testing can’t simulate the chaotic combinations of stress factors that real deployments encounter. If troubleshooting requires flying in specialists to diagnose site-specific failures you’ve not seen before, your product isn’t scalable. Variability kills project economics. Lenders can model graceful degradation; they cannot model outcomes you can’t predict.

Workflow Friction. If your climate solution creates friction in how people actually work, it will remain sidelined regardless of its technical merit. You either build drop-in solutions or provide overwhelming value. True “overwhelming” value must account for hidden switching costs; otherwise, the path of least resistance for a buyer is simply to stick with their existing carbon-intensive incumbent. Most founders underestimate how much “overwhelming” actually requires.

The Cost Parity Trap. Climate tech doesn’t compete in a vacuum; it competes against fossil-fuel incumbents optimized over decades and buoyed by subsidy tailwinds. Startups routinely develop products with premiums that are structurally incapable of reaching parity. In industrial markets, 50% premiums are a non-starter at scale, no matter how much better your product is. If your path to profitability depends on a 100x production increase you can’t fund, you haven’t built a business; you’ve built a niche curiosity. Founders consistently underestimate the steepness of the learning curve and the capital required to descend it.

The Bankability Gap. Hardware-intensive startups often design for venture milestones while ignoring project finance requirements. Scaling from pilot to fleet requires moving beyond equity to secure low-cost debt. Products deemed unbankable by cautious lenders trap startups in the FOAK “Valley of Death.” If a bank cannot model your technical risk, or if you lack the contractual offtake and performance guarantees required for underwriting, scaling stalls. You can’t just build a functional machine; you need to build a bankable asset that traditional lenders will finance at scale. Many founders don’t think about this until they’re too far into a funding burn.

The Readiness Gap. Scale in climate tech is a three-way collision between what you can build, what you can source, and what customers can actually run. Manufacturing Readiness (building Unit #100 identically to Unit #1), Supply Chain Readiness (no 18-month component lead times), and Operational Readiness (running without expert babysitting) don’t move independently. The real breakthrough isn’t proving the science works on a bench. It’s shipping a system where manufacturing produces consistent outputs, supply chain doesn’t create single points of failure, and field operations don’t devour your team. You’re not just selling technology. You’re selling a predictable, sourceable, and serviceable asset that works when you’re not in the room.

The Irreversibility Problem

In software, many most decisions are reversible. You ship, you learn, you iterate. The code is malleable. The infrastructure scales elastically. You can pivot a product in weeks. Climate tech often doesn’t work this way.

When you commit to a manufacturing process, you’re committing capital that can’t be recovered. When you sign an offtake agreement, you’re locking in product specifications for years. When you select a battery chemistry, a materials supplier, or an interconnection point, you’re making decisions that propagate through every subsequent choice.

The tragedy is that founders make these decisions based on assumptions that haven’t been tested. They commit to manufacturing architectures before validating cost parity is achievable. They design products for durability specifications that don’t match field conditions. They build for customers who turn out to have different operational constraints than anticipated.

By the time they discover the mistake, it’s baked into their product.

This isn’t just a hardware problem. Climate SaaS solutions such as carbon accounting platforms, grid forecasting tools, marketplace engines operate inside regulated, operationally brittle environments. Once embedded, changing assumptions becomes slow and painful. Trust, not code, becomes a one-way door. Whether you’re pouring concrete or shipping code, founders commit to product decisions based on untested assumptions, only to find the market won’t absorb what they’ve built.

Here’s the question you should ask yourself: can you defend your product’s existence in a six-page document? Not defend the technology. Not defend the market opportunity. Defend why a specific customer will pay for this product to solve this problem, with a clear path to cost parity, bankability, and scalable manufacturing.

The Antidote: Working Backwards to Test Assumptions

In the early 2000s, Amazon developed a methodology called Working Backwards precisely for environments like this. Not because Amazon is full of cautious business leaders, but because Amazon makes considerable infrastructure bets with long payback periods. Sound familiar?

Working Backwards is exactly what the name suggests: you start with the customer outcome you want to create, then work backward to the product, the technology, and the roadmap required to deliver it. Instead of building something and hoping customers want it, you define what “want it” looks like first, then pressure-test that definition until you’re confident enough to commit capital.

The core artifact is the PR/FAQ: a press release announcing your product as if it’s already launched, followed by an FAQ answering essential questions and difficult objections.

The press release is typically a single page. It forces you to articulate the customer, the problem, and the outcome in plain language. No jargon. No efficiency metrics. No appeals to climate urgency. Just: which customer is this for, what problem do they have today, and how does their situation change after they use your product? You also write fictional customer quotes describing the value they realized by using your product. If you can’t write a believable quote, you probably don’t understand what the customer actually values.

The FAQ section, typically around five pages, is where you confront the essentials and the objections, including visible risks. What happens when the product degrades after six months in the field? How does this integrate with existing workflows without shutting down operations? What’s the total cost of ownership compared to an incumbent? Can a bank underwrite this asset for project finance? Each answer surfaces an assumption you’d otherwise discover at the manufacturing line.

Here’s why this matters more than pilots or demos: a pilot proves your technology works under controlled conditions. A spreadsheet proves your unit economics work under optimistic assumptions. Neither forces you to confront durability, workflow friction, bankability, and at-scale economics simultaneously, in writing, where contradictions become visible.

The PR/FAQ does. When you write that your product “reduces maintenance costs by 30%,” you’ve created a falsifiable claim you can take to real customers. When you write that “local technicians can service the unit with standard tools,” you’ve made a commitment your engineering team has to deliver. When you answer the bankability FAQ, you discover whether your product architecture is even compatible with project finance, long before you’ve built the manufacturing line.

Counterintuitively, writing often exposes assumptions faster than building. In complex systems, the fastest teams aren’t the ones that build first. They’re the ones that are wrong sooner. And in a sector where most decisions are irreversible, exposing assumptions early is how you avoid walking through the wrong door.

What Founders Will Learn

Writing a PR/FAQ sounds simple, but most founders either pull punches or lack pattern recognition for which assumptions matter most. That’s what Working Backwards for Climate Founders: Ship Fast, Ship Right provides: structured pressure to stress test durability, workflow fit, cost parity, and financing readiness before those assumptions become capital commitments. I spent 11+ years at AWS building cloud services that scaled to millions of customers. The methodology isn’t magic; it’s a forcing function for intellectual honesty when conviction would otherwise carry the day. In the program, founders will apply specific Amazon ways of thinking:

Primitives beat platforms. Focused building blocks expand your degrees of freedom; platforms hard-code constraints you’ll regret.

Write the launch story before you write code. Speed without clarity on the real customer just gets you to the wrong outcome faster.

Use the FAQ to kill your favorite idea early. Killing weak ideas on paper isn’t failure; it’s how strong ones survive.

The document is the prototype. A six-page document costs weeks; a wrong pilot plant costs years.

Strong Principles, Loosely Held: Facing the Critics

Let me be honest: there are plenty of valid criticisms of this approach.

Critics often dismiss the PR/FAQ as a “waterfall” relic that locks teams into static solutions Startup teams, especially, see it as a luxury they can’t afford, “We’re racing a funding clock here.” Others worry that writing “fictional” customer quotes drifts into creative writing, or that the process rewards documents over shipping the right product. And yes, there’s a blind spot here: some products depend more on aesthetic intuition than rigorous prose.

But this is exactly where the PR/FAQ earns its keep. It becomes the source of truth for stakeholders. It forces intellectual honesty. You get ready-made marketing language. Finance gets unit cost assumptions and business-model inputs. Legal sees implications early. Product and Engineering align on what they’re actually building.

Most importantly, the PR/FAQ is not static. It should evolve. That’s the point. The real discipline is not writing it, but rewriting it when customers prove you wrong. That’s the hinge. Your source of truth evolves as your customers evolve.

Yes, Claude or ChatGPT can draft it. But if AI writes it for you, you miss the point. Think first. Write first. Then refine with AI.

As Amazonians say: strong principles, loosely held.

Program Details

Working Backwards for Climate Founders is an eight-week cohort program for founders building hardware, software, or integrated products in energy, renewables, industry, agriculture, and infrastructure.

The program includes three 2.5-hour group sessions, two private 30-minute coaching sessions, and structured peer review. Total founder time investment: 15-20 hours including customer interviews and PR/FAQ iterations. Cohort size is limited to five founders.

Founders leave with five deliverables:

1. You’ll know what your customer is actually buying, articulated in plain language, without jargon, in a way a real buyer recognizes.

2. You’ll know the price your customer will pay based on the operational problem you’re solving instead of your cost structure or manufacturing assumptions. And you’ll have the interview data to defend that number to an investor.

3. You’ll be able to articulate, specifically, which of the six failure modes is your highest-risk exposure right now. And, what would have to be true for you to be wrong about that

4. You'll have a repeatable process for testing product assumptions, whether now or at different product inflections

5. You’ll learn how to run a story-based discovery interview, and how to extract the unmet need from the story rather than from the answer.

How Peers Beat Platitudes

Your peer cohort isn’t a networking group; it’s a product review board. These are five founders navigating the unforgiving physics of hard tech and trying to raise capital in tough environments. When a peer flags an optimistic yield in your business case or questions assumptions in your FAQs, they aren’t guessing; they are speaking from the scars of their own failure modes. Shared constraints are infinitely more valuable than unearned platitudes from those who haven’t lived the gap.

The Challenge

The next cohort starts June 29, 2026 and runs through August 28, 2026. Two cohorts available, five founders each. Spots are limited. Early applicants receive priority.

Apply here

We Discuss

• Why neither natural gas or nuclear are the answers to powering data centres in the short to medium term.

• Are moonshots like flying data centres to space or fusion power the answer?

• Why renewables are the only option available when it comes to quickly building out new power generation and what this means for building out the new clean economy.
  

Want to watch the deep dive we talk about?

Where to find Jordy:

LinkedIn: https://www.linkedin.com/in/jordygold/

Where to find Skander:

LinkedIn: https://www.linkedin.com/in/skandergarroum/

Subscribe now

Hey there! 👋
Skander here.

Welcome back to Follow the Money, our monthly capital flows briefing with Jarek Dmowski.

February confirmed what January hinted at: 2026 is shaping up differently. $18 billion across 85 tracked deals, and the geography of climate capital is shifting in ways worth paying attention to.

Asia led for the second straight month at $6.4 billion. Europe came in close behind at $6.1 billion. North America, despite 31 deals (the highest count), trailed both at $3.7 billion. The US is putting serious money into fusion and advanced nuclear. The rest of the world is building solar, wind, and storage at scale. Two very different theories of how you decarbonize a grid, playing out in real time.

A few signals Jarek flags that we think are especially worth tracking: the EIB’s €3 billion facility to prepare European households for carbon pricing before it hits in 2027. Five robotics deals (mostly in China) that point to automation as a climate play, not just an industrial one. And India’s EV ecosystem, which is now attracting capital across buses, three-wheelers, charging, and fleet leasing in a single month.

🌊Jarek breaks it all down below, region by region, theme by theme.

But first: Who is Jarek?

Jarek Dmowski is a global transformation leader who partners with high-growth companies with positive climate impact. He combines industry and climate finance expertise with a strong track record of driving growth—across PE/VC-backed scaleups, ABN AMRO, and BCG.

He scaled a data-driven technology company ~2.5x to ~$25M in revenue and led post-merger integrations that enabled ~6x accelerated growth. At a global financial institution, he spearheaded a $2B capital reallocation toward new energy and mobility. He also developed a comprehensive climate plan that translated the Paris Agreement into actionable targets across sectors and established a $250M program to drive efficiency gains and reduce emissions at an energy utility.

Jarek is passionate about how the climate transition reshapes economies and business models, creating significant opportunities for multi-country growth and impact.

Follow the Money - February 2026

by Jarek Dmowski

Welcome to the next edition of “Follow the Money” - a monthly briefing on the capital flows shaping the climate transition.

February didn’t slow down, confirming a strong start to 2026.

One theme continues to build momentum: nuclear’s breakout year is accelerating. In the US, five fusion and fission ventures raised a combined $840M in February — including Inertia Enterprises’ $450M Series A to develop Thunderwall, a next-generation grid-scale fusion system. The story is no longer just policy ambition — it’s early-stage capital flowing into hardware with clear pathways to scale.

In Europe, the signal came from policy-backed capital. The European Investment Bank launched a €3 billion ETS2 pre-financing facility, aimed at preparing households and energy systems for the EU’s upcoming residential carbon market in 2027 — a reminder that transition financing is increasingly about enabling adoption, not just innovation.

Meanwhile in Asia, capital is flowing into robotics as a climate enabler. Companies like Spirit AI and AI² Robotics raised a combined $435M, reflecting growing conviction that automation — from industrial processes to logistics — will be critical to scaling climate solutions.

Where did money flow in February 2026?

Explanation of the approach and source data: The investment list was developed based on disclosures, newsletter monitoring and review of climate news. Although not exhaustive, 85 climate-related investment deals were tracked—amounting to roughly $18 billion (all data in US$), covering all continents and different life stages of companies and development finance programs. Data skew toward early-stage companies and investments, as well as development financing programs. We are continuously working to expand the data sources and coverage of investments.

So, where did the money flow in February 2026?

• Asia — for the second month in a row — led with ~$6.4 billion across 24 deals, closely followed by Europe at ~$6.1 billion (20 deals). North America trailed at ~$3.7 billion (31 deals), while activity across other regions remained more limited at ~$1.6 billion (6 deals).

• Energy once again dominated, accounting for ~$12 billion across 31 deals — by far the largest category month after month. Adaptation & resilience emerged as a clear #2 (~$4.6 billion, 6 deals), followed by Industrial, Transport, and AFOLU. Buildings remained undercapitalized (~$0.1B), continuing a persistent gap in the transition.

• AI’s influence is becoming structural. Nine AI-enabled climate solutions raised capital in February, reinforcing the role of artificial intelligence as an accelerator of deployment, optimization, and cost reduction across sectors.

• Robotics, a new tracked category, saw five investments in February, particularly in China, underscoring its growing industrial and climate-adaptation roles.

• Venture capital activity remained resilient. We tracked 49 venture and growth investments (Seed through Series F), with an average round size of ~$64 million. North America led with 18 deals, followed by Europe and Asia with 14 deals each — indicating a relatively balanced early-stage innovation landscape.

• Public and development finance continued to anchor the market. Multilateral institutions and government programs supported ~$3.7 billion across ~18 deals, with a strong focus on infrastructure and adaptation. Notably, February also saw the largest blue bond issuance to date.

Let’s now dive deeper into 2026 watchlist themes (please refer to our December perspective for more details) and across regions to highlight technologies with real scaling potential over the next 3–5 years.

Which (of our 2026) themes were most strongly visible in February?

U.S: Nuclear and Geothermal vs. RoW: Solar and Wind

February reinforced a divergence already visible in January. In North America, capital concentrated in dispatchable, next-generation energy systems — spanning fusion, advanced nuclear, and grid hardware. Notable raises included Inertia Enterprises ($450M), SHINE Technologies ($240M), Heron Power ($140M), DG Matrix ($60M), and Utility Global ($100M).

By contrast, Europe and Asia deployed capital into proven, scalable infrastructure — solar, wind, storage and pumped hydro. Large-ticket investments included multi-GW solar projects in Turkey (~$2.0B), Samruk Energy’s renewables expansion (~$2.0B), Prime Infrastructure Capital’s pumped hydro portfolio (~$1.3B), EnBW’s €1.04B hybrid bond, and the Andalusian Green Hydrogen Valley (~$1.15B).

Geothermal was quieter in February than in January, but the underlying U.S. appetite for dispatchable clean power still looks intact.

“Solarpunk” Continues

February was a landmark month for the ‘EVs beyond cars’ narrative - particularly in emerging markets.

In India alone, multiple platforms raised capital across the ecosystem: Drivn ($80M; electric buses and trucks), Euler Motors ($30.5M; electric three-wheelers), Turno ($5.2M; intercity buses), Statiq ($18M), and Exponent Energy ($20M; ultra-fast charging). In Africa, momentum is building around two- and three-wheeler electrification: Spiro ($50M; motorcycle battery-swapping) and GoCab ($45M, EV ride-hailing).

The pattern is clear: cheap batteries + localized mobility models = rapid electrification, particularly in markets where two- and three-wheelers dominate transport demand.

Dual Use: Climate + Defense / Security of Supply / Compute

In February, a distinct cluster of dual-use investments emerged, linking climate tech with security, resilience, and compute infrastructure.

In Europe, Frankenburg Technologies ($32.7M Series A) is explicitly positioned around sovereign resilience, while FlyFocus (€4.8M) and Farsighted Vision ($7.9M) develop autonomous systems with both civil-defense and climate-adjacent applications. In the U.S., DG Matrix and Heron Power are building solid-state transformer technologies critical for both grid modernization and data center resilience.

The blurring of climate tech, energy security, and defence applications is one of the defining features of Europe’s 2026 investment landscape.

Robotics and Climate Tech

February tracked five robotics-focused investments, reinforcing robotics as an emerging climate enabler.

China led with scale: Spirit AI ($290M) and AI² Robotics ($145M) are advancing industrial and logistics humanoids — with direct implications for manufacturing efficiency and energy intensity. Elsewhere, robotics is being deployed in high-impact, climate-relevant use cases: EyeROV ($1.5M; offshore inspection) and Apeiron Labs ($9.5M; marine monitoring).

The common thread: robotics is being deployed in climate-relevant operational contexts — offshore energy, precision agriculture, industrial logistics — at increasing frequency and scale.

Europe

Europe recorded 20 deals totaling ~$6.1 billion, combining large-scale public financing with venture and growth capital across energy infrastructure, nuclear, maritime decarbonisation, electrification, and circularity.

The most consequential move was structural. The European Investment Bank launched a €3 billion ETS2 pre-financing facility — bridge capital to support households ahead of the EU’s residential carbon market in 2027. The facility reflects an important innovation: using public finance to reduce the shock of carbon pricing on residential consumers, accelerating the shift to heat pumps and clean heating before the cost signal arrives.

Selected highlights:

• newcleo (France) - $88M - advancing lead-cooled fast reactors capable of using recycled nuclear fuel. With pilots planned in the UK and Italy, regulatory progress will be a key test for Europe’s nuclear competitiveness.

• Tem (UK) - $75M Series B - AI-powered energy trading platform enabling real-time optimisation in increasingly volatile, renewables-heavy grids - sitting at the intersection of AI, grid flexibility, and climate data.

• Metiundo (Germany) - €40M - software platform linking buildings and grid networks to unlock demand-side flexibility.

• Metafuels (Switzerland) - $24M - advancing methanol-to-jet fuels, highlighting Europe’s continued push to build viable pathways for aviation decarbonisation despite challenging economics.

• Bobine (France) - €13M Series A - developing electrochemical plastic recycling with potential for lower-energy, higher-purity circularity - a possible breakthrough if scalable.

• Frankenburg Technologies, FlyFocus and Farsighted Vision - smaller rounds, but strategically relevant. They reflect the increasing overlap between resilience, autonomous systems, and climate-adjacent infrastructure security.

North America

North America recorded ~$3.7 billion across 31 deals in February 2026. The defining narrative was clear: the U.S. is doubling down on firm, dispatchable clean power — particularly nuclear, fusion, and advanced grid technologies — at a pace and concentration not seen before. Alongside this, grid infrastructure and virtual power plants (VPPs) continued to attract meaningful capital.

Selected highlights:

• Inertia Enterprises - $450M Series A - a milestone-based raise to develop Thunderwall, a grid-scale inertial confinement fusion system. The structure - tying capital to technical milestones - signals growing investor confidence in fusion while actively managing risk.

• SHINE Technologies - $240M - already generating revenue from fusion-based medical isotopes, SHINE combines near-term commercial viability with long-term fusion optionality, materially reducing technology risk versus pure-play fusion.

• Avalanche Energy - $29M (+$10M grant) - developing compact fusion reactors for industrial and maritime use. If successful, small-form fusion could unlock entirely new applications beyond utility-scale power.

• Alva Energy - $33M Series A - focused on nuclear uprates (the process of increasing the licensed power output of existing nuclear plants) - one of the fastest and lowest-cost pathways to expand baseload capacity across the existing U.S. fleet.

• Heron Power - $140M Series B and DG Matrix - $60M Series A. Both are scaling solid-state transformer technologies, critical for data centres and renewable grid integration.

• Lunar Energy - $232M Series C+D - a leading home battery and VPP platform, with its Gridshare network aggregating distributed assets into grid services.

• Utility Global - $100M - producing hydrogen from industrial off-gases - a capital-efficient pathway to decarbonise hard-to-abate sectors.

• Tomorrow.io - $175M - building an AI-native weather platform with its own satellite constellation. As climate volatility increases, proprietary data infrastructure becomes a strategic moat.

Asia and RoW

Asia recorded ~$6.4 billion across 24 deals in February 2026 — marking a second consecutive month of strong capital deployment.

Large-scale solar and renewables investments in Turkey and Kazakhstan drove headline volumes, while India reinforced its position as the most dynamic EV ecosystem globally. At the same time, China continued its aggressive push into industrial robotics, with growing relevance for climate-critical supply chains and manufacturing efficiency.

Asia

Key highlights from Asia:

• Spirit AI (China)- $290M - developing humanoid robots for industrial use. Robotics is becoming critical for clean-tech manufacturing and industrial efficiency.

• AI² Robotics (China) - $145M - logistics and warehouse automation. Improves supply chain efficiency and energy use, including in EV and battery ecosystems.

• Octopus Energy (China JV) - Octopus is scaling its Kraken platform and energy retail model into China via a joint venture, signalling growing interest in software-led optimisation of power systems.

• Drivn (India) - $80M - leasing model for electric buses and trucks, unlocking fleet electrification by removing upfront capex barriers.

• Euler Motors (India) - $30.5M - focused on last-mile transport, one of the highest-impact EV segments by volume.

• Radiance Renewables (India) - $100M - 926 MW solar, wind, and storage portfolio, a strong example of blended finance mobilising institutional capital.

• Statiq (India) - $18M - expanding fast-charging infrastructure.

• Exponent Energy (India) - $20M - ultra-fast charging for fleets, potentially to reshape EV economics in logistics markets.

• EBRD leading $195.5M solar + BESS financing in Uzbekistan - a template for de-risking clean energy in emerging markets.

RoW

The Rest of the World accounted for ~$1.9 billion across 7 deals in February 2026.

Brazil’s Sabesp water infrastructure financing dominated volumes, while Africa continued to scale e-mobility and resilience infrastructure. Australia, meanwhile, attracted significant private equity into utility-scale clean energy, reinforcing its role as a key deployment market.

Key highlights:

• Sabesp (Brazil) - $1.35B Blue Bond - financing water infrastructure and climate resilience in São Paulo. A landmark deal highlighting water as a core climate adaptation priority.

• HMC Capital (Australia) - $423M from KKR - funding utility-scale BESS and wind. Signals growing private equity entry into Australian clean energy infrastructure.

• Spiro (Kenya) - $50M debt financing - expanding battery-swapping for electric motorcycles.

• GoCab (Côte d’Ivoire) - $45M - scaling EV ride-hailing, targeting rapidly urbanising markets.

• Varaha (India) - $20M - platform for carbon removal and regenerative agriculture at the intersection of nature-based solutions, AFOLU, and carbon markets.

• Bank for Agriculture and Agricultural Cooperatives (Thailand) - $164M - supporting climate-smart agriculture and focused on smallholder resilience and productivity.

What will we observe in 2026?

January set the tone; February reinforced it.

The U.S. is making explicit bets on advanced nuclear and fusion — with private capital, not just public funding, now leading the charge. Europe is deploying policy-backed finance to bridge the gap to mass adoption. Asia continues to scale utility-scale renewables at an unmatched speed. And emerging markets are building the EV, resilience, and nature-based infrastructure that will define the next phase of the climate economy.

March will test whether this momentum sustains. We will be watching whether the themes identified in December continue to deepen:

• U.S.: Nuclear and Geothermal vs. Rest of World: Solar and Wind

• “Solarpunk” Momentum — electrification beyond cars, powered by cheap batteries

• Dual-Use Innovation: Climate + Defense, Supply Chain, Compute

• CapEx-Intensive Mid-Stage Tech and the “Valley of Death”

• Industrial Heat Electrification

• Nature-Based Solutions for Carbon and Biodiversity

• AFOLU Innovation — including climate adaptation, robotics, and alternative proteins

• The Rise of Climate Robotics

Stay tuned for next month’s edition as we continue to follow the capital shaping the climate transition.

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Hey there! 👋
Skander here.

You know how food companies handle methane? One sets a Scope 3 target. Another joins a voluntary pledge. A third is running a program to reduce emissions on dairy farms in France. Fifty of the largest food and agriculture companies in North America, each building its own approach, each figuring out measurement from scratch, most of them unable to tell you how much methane their supply chain actually produces.

: According to data released in 2025, out of 50 companies, only 17 have science-based reduction targets. 32 disclose Scope 3 emissions and have emission reduction targets that include Scope 3 and of these only 3 disclose time-bound commitments to reduce non-CO2 emissions, including agricultural methane.

The problem is structural. These companies don’t own the farms. They can’t control what happens three tiers deep in their supply chains, across thousands of producers, in dozens of countries with different regulations. They’re being asked to fix a system they don’t operate.

Nandita Srivastava spent years at the International Food Policy Research Institute managing multi-country food systems programs across Asia and Africa. She coordinated the messy middle ground between research findings, policy frameworks, and what actually happens on the ground. She knows what it looks like when the science exists, the targets exist, and adoption still stalls.

Today she looks at the methane gap and asks: what if the real bottleneck isn’t corporate ambition but the absence of a de-risking layer? What if philanthropy and NGOs stepped in to absorb the early uncertainty, fund the shared infrastructure, and lower the cost of action for everyone?

• Why corporate methane commitments keep stalling at pilot scale (and the Ceres data that shows the dropout rate from target-setting to actual strategy)

• How philanthropic capital can absorb the R&D risk that no single company will take on alone, with models like the Enteric Fermentation R&D Accelerator already proving it works

• The farm-level cost problem: what it actually takes to get anaerobic digesters, methane sensors, and climate-smart rice packages to smallholders

• Why measurement infrastructure needs to be treated as a public good, and what Carbon Mapper and the Dairy Methane Action Alliance are building

• A capacity-building framework borrowed from IFPRI’s institutional mapping work that changes how companies decide where to invest

Let’s get into it. 🌾

First: Who is Nandita?

Nandita Srivastava is a policy researcher, project manager, and communicator with over nine years of professional experience across government, NGO, and private organizations. She began her career as an economics professor at a national university in India and later worked in regulatory enforcement as an economist with India’s antitrust regulator.

Most recently, she was an analyst with the International Food Policy Research Institute. In this role, she managed a diverse portfolio of food systems and climate-related projects, coordinating global teams across Asia and Africa. She shaped project scopes and budgets, aligned teams to deliver high-quality outputs, and supported stakeholder engagement with universities, research partners, donors, and others. She has translated research insights into practical policy and communication materials. These have informed donor strategies and advocacy efforts on climate change, youth entrepreneurship, systems integration, and capacity strengthening in the food sector.

Nandita is currently in career transition and looking for her next opportunity. She is passionate about connecting the dots between strategy, research, operations, and communication to make complex systems work more smoothly. She is particularly interested in project management, advisory, and communications/advocacy roles where she can leverage her expertise to drive resilience building across global food landscapes.

Connect with Nandita on LinkedIn or directly at nsrivastava06@gmail.com.

The Methane Gap

I. The Methane Challenge in Food Systems

Food systems sit at a crossroads in the climate story. It is both a significant driver of the emissions destabilizing our planet and one of the systems most acutely vulnerable to climate change’s consequences. The urgency of methane reduction, for me, is rooted in this interconnection — reducing the sector’s climate footprint while ensuring food and nutrition security.

Among the anthropogenic methane sources, agriculture is a key contributor. The sector is responsible for almost half of the global anthropogenic methane emissions, driven primarily by livestock, rice cultivation, food loss and waste, biomass burning, and certain biofuel sub-sectors.

But, despite methane being characterized as a low-hanging fruit to achieve net zero emissions, the implementation story is far from linear. During my years at a leading international food policy NGO, coordinating multi-country programs in the Global South, I witnessed firsthand the challenges in addressing the gaps between scientific knowledge, real world evidence, and on-the-ground implementation.

From the private sector perspective, the structural challenge can be daunting. How does a global food company influence emissions occurring three steps removed in their supply chain, on a farm they do not own, in an evolving regulatory environment? The answer cannot be to ask farmers or private companies to absorb the entire risk of this transition alone. Systemic change requires a shared accountability and a shared investment in progress.

This guidebook is born from the conviction that moving from corporate ambition to system-wide adoption requires realigning the incentives and clarifying how responsibility is distributed. Drawing on my experience synthesizing evidence and providing strategic advisory recommendations for diverse stakeholders, I explore how philanthropy and NGOs can serve as the essential de-risking layer in the methane reduction ecosystem. The goal is not simply a reduction in emissions numbers but to strengthen collaboration architecture between the private sector, NGOs, and philanthropy in service of both a livable climate and a food-secure future.

Methane Mitigation: A Structural Challenge?

According to the latest report by Sightline Climate, total climate tech venture and growth investment rose to $40.5bn in 2025, up 8% year-on-year, and cumulative investment since 2020 increased by 19%. Despite the overall growth, investments in food systems methane mitigation remain inadequate, according to a study by Climateworks Foundation and the Global Methane Hub (GMH).

Food companies are key players in the climate action ecosystem with influence on agricultural production, sourcing practices, processing, retail operations, and consumer demand. They can accelerate low-emissions pathways by setting targets, deploying innovation, and strengthening disclosure systems. Ceres Food Emissions 50 benchmark measures progress made by 50 of the largest public companies in the food and agriculture sector in North America toward addressing climate risk and accelerating lower-emissions transition.

According to the latest data, 38 companies disclose Scope 3 emissions while 30 companies disclose that their Scope 3 emissions include agricultural emissions. There are 32 companies which disclose Scope 3 emissions and have emission reduction targets that include Scope 3 and of these just 17 have Science Based Targets initiative (SBTi)-approved emissions reduction target that is aligned with 1.5˚C or well-below 2˚C and only 3 have time bound greenhouse gas (GHG) specific targets to reduce agriculture non-CO2 emissions from their supply chains. In addition, 18 companies assessed and disclosed emissions sources within the purchased goods and services category and just 5 have disclosed having a quantified GHG emissions reduction strategy to meet the reduction targets.

Findings from the data are indicative of a broader structural challenge in the methane mitigation landscape.

Emissions which occur at the upstream level may well be beyond the direct ownership and operational boundaries of food companies. This limits corporate leverage and makes companies vulnerable to reputational and regulatory risk without direct control. Even companies with strong climate commitments must rely on partnerships, supplier contracts, and other voluntary incentives to influence methane outcomes. Thus, expecting companies alone to absorb uncertainty, finance sustainability focused public-good infrastructure, and realign incentives is not a prudent approach.

The central question remains: how do we move from corporate ambition to system-wide adoption? The answer depends on establishing clear roles and responsibilities, specifically defining who will step up and how across five pillars:

1. absorb the early-stage research, technology, and market risks

2. bear the upfront and ongoing project costs and support technology implementation

3. provide favorable policy and regulatory ecosystem

4. build and operate measurement and verification systems

5. strengthen institutional and human capacity

Without this clarity, corporate methane action will keep falling short, not for lack of scientific evidence, but because of a systems-level structural and coordination failure.

Companies cannot fix an unclear and fragmented landscape alone. Solving a systems-level challenge requires a systems-level response. This guidebook discusses how philanthropy and NGOs are pivotal structural enablers to reduce risk, redistribute risk, and lower transaction costs in ways that promote long term private-sector methane action at scale. Across five pillars — research and development innovation, project costs and technology implementation, policy and regulatory systems, measurement and verification systems, and capacity building — these actors can absorb early uncertainty, coordinate fragmented stakeholders, and build shared mitigation focused outputs and results that markets alone undersupply.

II. Strategic Pillars of Methane Mitigation

1. Bridge the Research and Development Gap

The Corporate Challenge:

Economic considerations are central for decision making by food companies. They often operate in markets which are highly competitive and price sensitive. In the absence of strong incentives such as lower input prices, high demand for low-methane products, companies can struggle to justify the commercial case for high risk and early-stage investments with extensive field testing and regulatory approval prior to commercialization. Technology readiness also constrains progress. While a growing range of methane mitigation solutions exists, effectiveness can vary significantly across production systems.

Philanthropy’s Role:

Philanthropy is uniquely positioned to provide non-dilutive capital capable of absorbing scientific and commercial uncertainty. Unlike other funding sources, philanthropic capital tolerates long time horizons, high failure rates, and unclear commercialization pathways. When strategically deployed, it supports foundational research, field trials, and interdisciplinary and multistakeholder collaborations. Global-access IP arrangements further enable the industry to benefit from the innovation, increasing uptake across production systems and improving the climate return on capital.

NGO’s Role:

NGOs serve as coordinators of scientific research, platforms for stakeholder engagement, and fundraisers for innovative solutions. By engaging researchers, philanthropies, academia, startups, governments, and corporate actors around shared research agendas, technology innovations, standardized methodologies, and common metrics, they co-develop knowledge products and accelerate knowledge transfer across production systems.

Case Studies:

The Enteric Fermentation R&D accelerator was set up by the Global Methane Hub in partnership with the Bezos Earth Fund, Gerstner Philanthropies, High Tide Foundation, Gates Foundation, Danone and other partners. What makes this cross-sector collaboration distinctive is the breadth of funding sources, and the rigor embedded in its structure. A Science Oversight Committee (SOC), which draws on technical expertise from various domains including non-profit think tanks such as Spark Climate Solutions, guides the research strategy across seven priority areas including inhibitors, genetics, vaccines, feedstuffs, and rumen microbes. This model allows private sector companies like Danone to access breakthrough research and innovation across diverse livestock systems without bearing the full R&D risk.

Another important initiative involving a consortium is the Greener Cattle Initiative by the Foundation for Food and Agriculture Research (FFAR), which supports research to mitigate enteric methane emissions. What stands out here is the initiative’s funding architecture, which combines an FFAR award and pooled matching funds from Nestlé, Global Methane Hub, JBS USA, Elanco, Genus PLC, and Council on Dairy Cattle Breeding (CDCB), among others. The diversity of this collaboration, with varied actors jointly financing a shared research agenda, speaks directly to the coordination logic at the heart of this pillar.

2. Support Project Implementation and Technology Adoption

The Corporate Challenge:

Reducing and measuring methane emissions requires investments at the farm level, including anaerobic digesters, manure separators, composting systems, and methane measurement chambers for rice cultivation. Aside from these costs, soft costs including permits, legal fees, environmental assessments, and ongoing operations management can be significant. For global food companies sourcing from diverse regions, understanding and supporting location-specific processes across thousands of suppliers is challenging. Corporate sustainability and procurement teams often lack the capacity and local knowledge to act effectively.

Philanthropy’s Role:

Philanthropic capital is well suited to absorb some of the transaction and equipment costs that are essential for project implementation but do not generate near-term cash flows. Deployed catalytically, it can finance the purchase and installation of farm equipment and inputs, oversee contracting and permit processes, and support the development of monitoring and verification frameworks and digital aggregation platforms.

NGO’s Role:

With strong local networks and established relationships, NGOs are well placed to manage farmer engagement, deploy technology and infrastructure, and oversee project implementation on the ground. They can also aggregate producers, enable financial support for farmers, coordinate activities with local governance, and ensure environmental and social safeguards are met.

Case Studies:

The International Rice and Research Institute (IRRI) work in developing countries highlights how a research institution can bridge the gap between knowledge and on-the-ground adoption. Its partnerships with government ministries, academic and research institutions, and local partners are driving adoption of low-emission rice practices in rice producing countries in Asia. Under a partnership with Bayer Crop Science and others, IRRI provided farmers with a direct seeded rice (DSR) package which included improved rice varieties, machinery, and weed management tools. The value of this model lies in diagnosing specific farm-level barriers including climate risks, water scarcity, and labor constraints, and delivering tailored solutions to address them.

A case study from Thailand illustrates the importance of financial de-risking at the farm level as an incentive for technology adoption. Under recent climate-smart rice initiative implemented in partnership with Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), the Bank for Agriculture and Agricultural Cooperatives (BAAC) has introduced climate-smart loan products with preferential interest rates for eligible farmers, alongside support funds allocated in accordance with the scale of technology uptake. By pairing technical assistance with accessible financing, the initiative addresses the inability of smallholder farmers to absorb the upfront cost of transitioning to lower-emission production methods at the farm level.

3. Leverage Policy and Regulatory Ecosystems

The Corporate Challenge

At the international level, several countries have joined the Global Methane Pledge - participants agree to take voluntary actions to contribute to a collective effort to reduce global methane emissions by at least 30% from 2020 levels by 2030. The pledge recognizes the essential role the private sector, philanthropy, and institutions play in supporting the implementation of the pledge.

For the private sector food companies that are sourcing inputs from diverse areas, national level policy and regulatory environments can add further complexity. Commitments, policies, and regulations may vary across countries and regions. Differing methane reduction approaches, complex regulatory systems, and layered local governance structures can create uncertainty around expectations, support, and compliance risks for companies considering long-term investments. The capital necessary for comprehensive Scope 3 tracking is difficult to secure. Private sector efforts often remain confined to isolated pilot initiatives instead of systemic emission reduction efforts.

Philanthropy’s Role

Beyond derisking corporate investment, philanthropies are well positioned to provide flexible grants that support government efforts to implement Nationally Determined Contributions (NDCs), national climate and resilience building policies, and related methane reduction initiatives. They drive multistakeholder engagement and advocacy efforts to embed methane reduction within national agendas. Through supporting pilot studies in selected regions, philanthropies can develop theories of change, generate data, and provide recommendations that enable government ministries and organizations to build and refine policy and regulatory frameworks supporting methane-related projects. Taken together, these actions send a strong signal to the private sector that adequate government support will be available when making investments and undertaking emission accounting and disclosures.

NGO’s Role

NGOs bring an evidence generation and translation function that is critical at the policy level. Through sector-specific methane assessment studies at the national and local levels, they can present evidence on the status of emissions, mitigation scenarios, and impact. By collating findings from pilot studies conducted by philanthropies and corporate actors, they distill insights into concrete policy recommendations, which are then used to lobby for national agricultural reforms aligned with farmer livelihoods and integrated with resilience building efforts. At the industry level, NGOs also create platforms for leaders to share methane reduction best practices and resources, identify collaboration opportunities, and strengthen accountability against global and national climate commitments.

Case Studies:

A recent Good Food Institute (GFI) engagement in Singapore exemplifies the power of sustained, evidence-based dialogue to shift regulatory outcomes. By collaborating with halal authorities over the years and sharing insights about cultivated meat, GFI contributed to a landmark ruling that cultivated meat can be categorized as halal given certain conditions are met. The broader implication for the private sector is significant: with halal demand being substantial, this ruling opens new consumer markets and creates a clearer incentive for alternative protein companies and retailers to invest in cultivated meats.

The U.S. Food Loss and Waste 2030 Champions group, formed by the U.S. Department of Agriculture (USDA) and U.S. Environmental Protection Agency (EPA) in 2016, illustrates how a government-anchored framework can organize and scale corporate climate action. The group’s target to accelerate national efforts to reduce food loss and waste by 50% by the year 2030 has since catalyzed commitments from over 40 companies to reduce food loss and waste in their own operations. In many instances, these companies receive support from local non-profit organizations and private foundations to recover food waste, divert it from landfills, and use it to address food insecurity. Several companies are also pursuing composting, animal feed, or anaerobic digestion. Some of these companies have also joined the World Resources Institute’s global 10x20x30 initiative where food retailers, providers, and suppliers commit to “Target-Measure-Act” approach through reducing food loss and waste by 50% in their own operations and measuring and publishing inventories. Taken together, this progression from national policy target to corporate commitment to NGO and philanthropy supported implementation reflects exactly the kind of layered coordination this pillar advocates for.

4. Strengthen the Accountability Layer

The Corporate Challenge:

Building credible and accessible Measurement, Reporting, and Verification (MRV) systems is critical to establish reliable emission baselines, track progress and performance, quantify climate impact, and unlock finance and incentives for farmers and innovators. But methane emissions from food systems are difficult to quantify accurately, as they vary depending on geography, production methods, and biological processes. Many companies rely on emissions factors rather than direct measurement.

In the absence of standardized and low cost MRV, transparency becomes a liability. With growing scrutiny around greenwashing, food companies face accusations of overstating emissions reduction or insufficient third-party verification. At the same time, verifying each ton of methane reduced can be costly and administratively burdensome, driving up transaction costs and slowing action.

Philanthropy’s Role:

Funding the development and deployment of data infrastructure, including high-resolution satellites, methane detectors, and sensors, is well suited to philanthropic capital, as it generates baseline data that benefits the industry as a whole rather than any single actor. Subsidizing measurement tools in this way lowers cost barriers for suppliers directly, while enabling the creation of science-based MRV protocols that steer the field toward direct and verifiable measurement.

NGO’s Role:

NGOs create and manage shared platforms that give food companies access to the same tools and guidebooks, minimizing duplication of effort and ensuring that companies reference comparable language when reporting to global benchmarks. Beyond platform management, NGOs serve as independent third-party verifiers, bringing the credibility needed to ensure emission calculations are robust and reliable.

Case Studies:

The Dairy Methane Action Alliance (DMAA) launched in collaboration with Environmental Defense Fund (EDF), addresses one of the more persistent gaps in corporate climate action — the absence of standardized, accessible guidance on methane accounting and disclosure. By bringing together member food companies through commitments to account for and disclose methane emissions in their supply chains and develop methane action plans, the DMAA creates a collective accountability framework. What anchors this commitment in practice is the open-access guidance the alliance has developed. A key resource developed by the alliance is open access guidebooks on dairy methane accounting and disclosures. These guides provide best practices and detailed stepwise instructions for a company to develop a methane inventory from their GHG inventory and publicly disclose methane emissions in alignment with ESG frameworks. These resources lower the technical barrier for companies, replacing fragmentation with a common standard.

Carbon Mapper, a nonprofit funded by the Bloomberg Philanthropies and others, represents how philanthropic capital can be deployed to build data infrastructure as a public good. Using remote sensing technology to detect and quantify methane emissions at the scale of individual facilities, it makes data publicly accessible across sectors. What makes this case worth examining carefully, however, is what it also reveals about the limits of current technology. Carbon Mapper acknowledges the difficulty of detecting and pinpointing emissions from key agricultural sources like livestock. This gap highlights where the next round of philanthropic investment in MRV infrastructure is most needed.

5. Build Capacity as an Adoption Lever

The Corporate Challenge

Climate action is often at a slow pace because of the underlying policy environment and human and institutional constraints. For instance, farmers may lack understanding, knowledge, and skills to use the technologies and are unable to receive adequate training support from local cooperatives and extension systems.

Implementation success depends on diagnosing and addressing existing capacity gaps.

Philanthropy’s Role

Philanthropy funds the independent, multi-level diagnostics needed to establish a reliable baseline of capacity needs. This diagnostic work spans three dimensions:

• Enabling Environment: Identifying policy gaps and regulatory hurdles at the national and local levels

• Organizational Level: Assessing whether state and local organizations such as extension systems and farmer support organizations have the technical, financial, strategic, coordination, and operational capacity to support technology implementation on the ground

• Individual Level: Analyzing the technical and behavioral readiness of farmers to adopt the technology

Once the specific barriers have been identified, philanthropies engage with stakeholders to develop a capacity building roadmap. Beyond needs assessment, they also provide financial support to food companies, NGOs, and governments to conduct structured workshops on specialized topics for local actors, using a training-of-trainers approach to ensure sustainable outcomes.

NGO’s Role:

NGOs can operationalize and implement the capacity needs assessment survey funded by philanthropies. As a first step, NGOs work with their local networks to map the relevant actors and players which will be part of the survey. Survey findings then inform key recommendations on addressing capacity gaps across the enabling environment, organizational, and individual levels, which are shared with stakeholders and translated into concrete action items as part of the roadmap. Local NGOs also collaborate with philanthropies and private companies to develop location and context-specific training materials and identify resource persons for technical workshops. Strengthening local institutional mechanisms is an equally important focus. This includes engaging local extension systems and representatives from administrative government units to understand local needs and challenges and build awareness of methane reduction interventions.

Case Studies:

IFPRI’s food system institutional mapping and capacity assessment in Niger is the kind of foundational work that needs more attention in corporate sustainability discussions. By providing key aspects and indicators that can be referenced to design surveys for specific geographies/technologies/climate change goals, it offers a replicable framework for understanding local conditions before committing to interventions. For a global company, this kind of data changes the quality of investment decisions. Rather than directing resources toward hard infrastructure without understanding the enabling conditions, companies can use such assessments to identify capacity gaps that need to be addressed first. Treating this kind of diagnostic as a prerequisite rather than an afterthought is an important perspective shift to ensure investments yield the desired outcomes.

The ‘Supporting Trusted Engagement and Partnership (STEP) up for Agriculture (STEP up for Ag)’ launched by major food companies PepsiCo, Unilever, and others, with catalytic funding from the philanthropic partners (Pepsico Foundation and Platform for Agriculture and Climate Transformation (PACT)) makes a related point through the lens of implementation. Rather than starting with a diagnostic, the program starts with a recognition that the success of food system sustainability efforts rests on local buy-in, and that farmer-led, farmer-facing organizations are critical to ground-level implementation. By strengthening the capacity of these organizations, the program treats trust as a strategic asset. Unilever’s implementation of STEP in the state of Iowa demonstrates this premise in practice by equipping local farmer support groups with training, tools, and funding to scale regenerative agriculture.

III. A Roadmap for Coordinated Action

The following roadmap outlines how philanthropy and NGOs can provide targeted and sustained support to move food companies from isolated pilots toward systemic methane reduction at scale.

Innovation: Fund the Science that Markets will not

• Remove proprietary barriers: Philanthropies must fill the funding gap at the initial phases of research and innovation, where commercial risk is high and private investment is limited. Equally important is what happens to the resulting innovations: global-access provisions should be embedded in philanthropically funded research from the outset, ensuring that advances in feed additives, genetics, and rice cultivation are accessible across diverse production systems rather than locked behind exclusive licensing arrangements that concentrate benefits and limit scale.

• Bridge the funding gap for emerging tech: Sustain patient capital through the expensive middle phase of technology development, the point at which promising solutions most commonly stall, to clear the path for private sector engagement once performance is demonstrated.

Technology: Lower Entry Costs for Corporate Action

• Absorb the soft costs: Finance key activities that companies struggle to justify internally, such as baseline data collection, feasibility studies, independent field trials, and permits and regulatory approvals.

• Support technology adoption: Invest in or enable financial support for mitigation technologies including anaerobic digesters, manure management systems, methane measurement chambers, climate resilient crop varieties, and sensor networks that create the operational foundation on which corporate commitments can be reliably built and verified.

Policy: Integrate Corporate Action with National Commitments and Strategies

• Integrate corporate action with national climate agendas: Fund and undertake sector-specific methane assessments that equip government bodies with the evidence needed to formally integrate methane reduction strategies into existing government commitments, such as Nationally Determined Contributions (NDCs), subsidy frameworks, and national agriculture strategies. This alignment turns voluntary corporate efforts into recognized contributions toward national targets.

• Build collaboration spaces: Convene multistakeholder platforms for corporations, supply chain actors, and governments, with support from NGOs and philanthropies, to share industry best practices and align baselines, methodologies, and disclosure norms.

Accountability: Treat Data Infrastructure as a Shared Foundation

• Standardize measurement tools: Develop high-quality, open-access data infrastructure and common reporting protocols. Shared standards reduce the administrative burden on companies and eliminate the risk of conflicting measurements or reporting inconsistencies.

• Utilize independent verification: Engage NGOs as objective third-party evaluators for a robust MRV system. This builds the public and investor trust necessary to unlock large scale climate finance, protects companies from greenwashing claims and creates momentum toward building carbon markets.

Capacity: Invest in Human and Institutional Readiness

• Conduct multi-level methane mitigation needs assessment: Fund independent mapping and needs assessment surveys to identify capacity gaps across the enabling environment, organizational structures, and individual readiness. Key insights from this baseline data are essential for designing tailored intervention roadmaps that address specific local barriers to adoption.

• Build local expertise to sustain adoption: Prioritize institutional strengthening alongside individual training, supporting local extension systems, cooperatives, administrative bodies, and farmers with the technical knowledge and coordination capacity needed to sustain adoption well beyond the life of any single project.

Methane reduction in food systems requires the right actors stepping in to share the risk, build the infrastructure, and create the conditions for sustainable action.

Have you seen collaboration models that work at scale?

I am currently seeking my next opportunity in project management, advisory, or communications and advocacy, and would welcome conversations with individuals working on food systems transformation, methane mitigation and resilience building, and cross-sector engagement.

Connect with Nandita on LinkedIn or directly at nsrivastava06@gmail.com.

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Hey there! 👋
Skander here.

You know how the chocolate industry tries to fix farmer poverty? One company pays a premium to its own supply chain. Another company pays a different premium to its own supply chain. Twenty programs running in parallel, each reaching a few thousand farmers, each with its own admin overhead, each covering maybe 2-3% of the problem.

Meanwhile, 1.2 million cocoa farming households in Côte d’Ivoire earn less than half of what they need to survive. When global cocoa prices quadrupled last year, exporters captured 68% of the windfall. Farmers’ incomes actually went down.

Dan Fullem is a Driftie from our most recent cohort. He spent 25 years in international corporate finance, managed SPVs with over $3 billion in power infrastructure assets, and helped take grid batteries from pilot to scaled procurement. He knows what it looks like when a system is stuck at "pilot" and what it takes to force the jump to "scaled."

He looked at the cocoa living income crisis and asked a different question: what if you calculated exactly how much each buyer benefits from a system where farmers stay poor, pooled those contributions into a single country-level fund, and used that pool to unlock sovereign debt financing?

The result is a detailed blueprint for a $49.1 billion public-private fund. It borrows a shared responsibility methodology from recent palm oil research, adapts it with cocoa-specific market data, and layers in debt-for-nature swaps modeled on what worked in Belize, Ecuador, and Gabon.

Today we’re looking at:

• Why fragmented company-by-company premiums will never close a $4.91 billion annual gap (and the math that proves it)

• How a “buyer responsibility coefficient” calculated from real forward contract data allocates fair contributions across exporters, processors, and manufacturers

• The fund mechanics: how $1 of private sector money becomes $1.72 through sovereign debt swaps, MDB co-financing, and carbon markets

• What the pilots (Tony’s Open Chain, Nestlé Income Accelerator, EnRoute) have proven works at small scale

• A delivery system built on Village Savings and Loan Associations that reaches 100% of farmers from Year 1

Let’s get into it. 🍫

First: Who is Dan?

Dan is a project management professional and draws on his 25-year international corporate finance experience to drive change. He started his career in the early dot-com days before going on to a career in the international power sector where he worked to take grid-batteries from pilot to scaled large-scale procurement of grid-services.

He also mapped out how private companies can procure renewable powerpurchase agreements in markets where regulations were still developing. During this period, he was also responsible for the financial management of SPVs with over $3b of power infrastructure assets.

Going forward, he will leverage his project management, finance and innovation experience at coalitions, NGOs and private companies looking to orchestrate systemic change within critical supply chains at the intersection of climate and social change: how to go from pilot to scaled impact.

Connect with Dan if this is something you are working to achieve www.linkedin.com/in/dan-fullem or directly at danfullem@gmail.com

The $49 Billion Chocolate Fix

What if I told you that every bar of chocolate you’ve ever eaten contains an invisible cost: the poverty of the farmers who grew the cocoa. In Côte d’Ivoire alone, 1.2 million farming households earn less than half of what they need to survive, leading to child labor prevalence rates around 50%. Despite years of premium payments, certifications, and pilot projects, 80.9% of cocoa farmers remain trapped below the living income threshold. The human crisis and climate change are tightly linked: this poverty is the root cause of West Africa’s deforestation crisis, as desperate farmers clear protected forests to expand cocoa production, the only lever they control to increase income.

Tony’s Chocolonely’s 2025 impact report offered a glimmer of hope: 40.6% of their farmers reached the living income benchmark during the 2024/25 season—more than double the previous year’s 19.1%.¹ But this masked a deeper problem. That season coincided with record farmgate prices. The Ivorian government raised the guaranteed price from 1,800 CFA francs/kg (€2.74) to 2,800 CFA/kg (€4.27)—a 56% increase—hoping to share global commodity market gains with farmers.² Then the crisis hit. As global prices fell in late 2025, exporters (those buying from farmers) refused to buy at the government-set price.³ By early 2026, farmers were being forced to sell cocoa at 2,000 CFA/kg despite the official 2,800 CFA/kg farmgate price, while 123,000 tonnes sat unsold in warehouses.⁴ Farmers who briefly reached living income during the price spike now face a double crisis: falling effective prices and unsold inventory.

This volatility exposes the fatal flaw of market-dependent approaches: commodity price swings leave farmers on a rollercoaster between survival and destitution. The solution must provide stability regardless of global market conditions.

Global Cocoa Market Prices

The current approach isn’t working. Fragmented company-by-company premiums reach only 5% of farmers. The math is brutal: even a substantial $736/ton premium translates to just $854/year for a typical farmer, leaving a $4,047 income gap (with the updated 2025 living income benchmark of $6,850/year). And that’s for the lucky few in certified supply chains. The other 95%? No path forward.

But what if there’s a better way? What if, instead of each company paying premiums for their own supply chain, contributions were pooled based on shared responsibility (how much each buyer benefits from a system where living income costs are externalized) and leveraged to unlock sovereign-scale financing?

Recent research on palm oil supply chains demonstrates a method for calculating fair, science-based allocations of responsibility between buyers and sellers. Applied to cocoa, combined with innovative debt-for-nature financing, this framework could close the entire $4.91 billion annual gap.

The critical insight: Instead of working against the existing system, the fund keeps the existing cocoa trade infrastructure completely unchanged—cooperatives, exporters, processors, and government price-setting all continue exactly as today. It creates a parallel supplement system delivered directly to farmers through Village Savings and Loan Associations (VSLAs), a proven community-led model reaching 30 million people globally. This means 100% coverage from Year 1 without waiting for regulatory reform, political battles, or market restructuring. By Year 10, the supplement system builds sufficient capacity to transition to permanent Living Income Reference Pricing and sustained productivity gains.

Here’s the journey I’m taking you on today:

Part 1: I’ll trace the living income crisis from individual farming households to country-level calculations, using real data to show why current approaches fall short.

Part 2: I’ll introduce a shared responsibility framework with a cocoa-specific buyer responsibility coefficient, showing how to calculate fair buyer contributions and why pooling them changes everything. This will cover $2.86 billion annually (58.26% of the total income gap).

Part 3: I’ll design a $49.1 billion public-private fund that leverages debt-for-nature swaps to multiply private sector contributions 1.7x, creating a mechanism that works at scale to cover 100% of the income gap.

This is about more than cocoa. It’s a blueprint for transforming how to address living wages and environmental protection across all agricultural commodities, from coffee and tea to palm oil to coconuts.

Will there be challenges in implementation? Absolutely. Payment delivery inefficiencies, coordination hurdles, and unforeseen complications are inevitable when operating at this scale. But any inefficiency in this system should be measured against the profound inequalities embedded in the status quo—where farmers capture 8.75% of retail value in normal years and see their incomes decline 11% when global prices quadruple. The question isn’t whether this fund will be perfect, but whether it’s better than a system designed to exclude farmers from economic surplus. Every challenge encountered becomes a learning that strengthens the model for replication across other commodities.

Let’s dive in.

PART 1: The Root of the Problem - Following the Money to the Farm Gate

The Invisible Crisis in Your Supply Chain

The numbers are staggering:

• 2.5 million cocoa smallholder farmers in Côte d’Ivoire and Ghana

• Supporting 40-50 million people globally through the cocoa value chain⁵

• 60% of the world’s cocoa comes from these two countries⁶

• Côte d’Ivoire alone: 1.5 million farming households producing 40% of global cocoa

But here’s what those numbers hide: widespread, systematic poverty.

The connection between living wage deficits and environmental destruction isn’t abstract. It’s cause and effect. When cocoa farmers can’t earn enough to feed their families, they make desperate choices: clearing protected forests for new plots, pulling children out of school to work on farms, abandoning cocoa farming entirely and migrating to cities.

Côte d’Ivoire has lost 90% of its forest cover over the past 30 years, with cocoa expansion a leading driver.⁷ Ghana has lost 65%.⁸ Child labor affects 1.56 million children in cocoa-growing regions.⁹

These aren’t separate crises; they’re symptoms of the same structural problem: cocoa farmers are systematically underpaid for their labor, and the costs of that underpayment (poverty, deforestation, child labor) are externalized onto farming communities and the environment.

A Case Study: Côte d’Ivoire’s Living Income Gap - Built from Farm-Level Reality

To understand the true scale of the challenge, the analysis needs to start with what’s actually happening on cocoa farms, not theoretical models. Tony’s Open Chain, one of the most transparent initiatives in the sector, collected detailed data across their Côte d’Ivoire supply chain that reveals the gap between ideal assumptions and farmer realities.

Farm-Level Data Points:¹⁰

1. Average farm size: 2 hectares (not 4.4 ha assumed by benchmark models)

2. Average yields: 580 kg/ha (not 800 kg/ha assumed by models)

3. Median household size: 6 people (not 8 assumed by models)

4. Labor costs: 63% hire labor brigades (models assume unpaid family labor)

5. Income diversification: 40% from non-cocoa sources (models assume 25%)

Let’s calculate what this means for a typical cocoa farming household:

Annual Gross Cocoa Income:

• Farm size: 2 ha

• Yield: 580 kg/ha

• Total production: 1,160 kg (1.16 tons)

• LIRP price: $2,398/ton¹¹

  • Farmgate: $1,662/ton

  • Fairtrade premium: $241/ton

  • Living Income premium: $495/ton

• Gross cocoa revenue: $2,782

Deduct Production Costs:

• Inputs (fertilizer, pesticides): -$400

• Hired labor (63% of farmers): -$500

• Other farming costs: -$200

• Net cocoa income: $1,682

Total Household Income (including other sources):

• Net cocoa income: $1,682 (60% of total)

• Other income sources: $1,121 (40% of total)

• Total annual household income: $2,803

Living Income Benchmark for Côte d’Ivoire:¹²

• Source: Anker methodology, updated in Tony’s Chocolonely 2025 Impact Report

• Household size: 6 people

• Monthly: 348,258 CFA Francs (€531)

• Annual benchmark: $6,850/year (€6,371)

The Income Gap:

• Gap amount: $4,047 per household

• Gap as percentage: 59.1% below living income

This aligns with Tony’s updated 2025 findings showing that 59.4% of farmers at their three long-term partner cooperatives remain below the living income benchmark, with most earning between 61-99% of the target.

Scaling to the Country Level:

Rather than assuming the average income gap applies to everyone, let’s use a progressive, distribution-weighted allocation based on where farmers sit on an income spectrum:

Income Distribution & Supplement Allocation:

Distribution methodology: Based on synthesis of Tony’s Chocolonely 2025 report (19.1% at living income in premium cooperatives), Fairtrade 2021 household income study, and WUR research showing 73-90% below living income threshold. General population distribution is more concentrated in poverty than premium cooperative samples.

Result: Progressive targeting ensures the poorest third of farmers (0-40% band) receive the largest supplements ($5,138/year), while those already near the threshold receive smaller top-ups.

Total Annual Living Income Gap for Côte d’Ivoire: 1,213,500 households × $3,241 average gap = $3.93 billion/year in direct income support

The $3.93B annual living income support allocation closes 100% of income gaps for all 1,213,500 households.

This is the system-level deficit that needs closing. It’s not a rounding error; it’s half of Côte d’Ivoire’s annual cocoa export revenues ($6-8 billion) and reflects the updated 2025 living income benchmark of $6,850/year.

What the Pilots Have Proven

Four major programs validate components of the solution

Over the past five years, four major initiatives have tested different approaches to closing the living income gap and reducing child labor in cocoa supply chains. Together, they’ve reached approximately 60,000 households and generated rigorous evidence about what works—and what doesn’t.

Tony’s Open Chain: Premium pricing works, but scale is the barrier

Tony’s Open Chain represents the industry’s most ambitious premium pricing model. Founded on the mission to make chocolate 100% exploitation-free, Tony’s Chocolonely created the Open Chain model in 2018 to share their sourcing practices with the broader industry. Today, 20 Mission Allies (including major food companies) have joined the initiative, working with three long-term partner cooperatives in Côte d’Ivoire.

What makes Tony’s revolutionary:

• Pays Living Income Reference Prices for 5+ consecutive years: industry-leading rates that go far beyond Fairtrade minimums

• Long-term partnerships with cooperatives, providing stability and trust

• Comprehensive support systems including training, productivity investments, and farmer services

• Radical transparency publishing detailed impact data annually, including failures alongside successes

• Reaching 32,133 farming households through their supply chain (2024/25 season)

Nestlé Income Accelerator: Conditional cash + comprehensive support

Nestlé launched its Income Accelerator Program in 2022, now reaching over 30,000 cocoa farming households across Côte d’Ivoire and Ghana. The program works with eight supplier companies—Cargill, ETG/Beyond Beans Foundation, Olam Food Ingredients (ofi), Barry Callebaut, ECOM, So-b-green, Sucden, and Touton—demonstrating private sector collaboration at scale. Partners include the International Cocoa Initiative (ICI), Rainforest Alliance, and IDH.

The program offers four conditional components: school enrollment cash transfers (EUR 100/year), subsidized pruning brigades (EUR 100), agroforestry support with 20+ shade trees (EUR 100), and income diversification through GALS (Gender Action Learning System) training, VSLAs (Village Savings and Loan Associations), and EUR 100 for women’s income-generating activities. Maximum total: EUR 500 over first two years, EUR 250 in subsequent years if conditions met.

The KIT Royal Tropical Institute’s rigorous evaluation found significant impacts after 30 months: 18% higher cocoa yields (+79 kg/ha), 26% higher cocoa revenue (+$648), 63% higher VSLA membership among spouses, 105% higher savings (+$68), 45% lower food insecurity (-12 percentage points), and 18% improvement in women’s empowerment index.¹³

Critical finding: Cash transfers were the mechanism driving resilience. Econometric analysis showed cash enabled farm investments, improved food security, increased savings, and promoted women’s empowerment—with a positive relationship between amount received and effect size.¹⁴

EnRoute Program: Testing integrated approaches

The ETG-Beyond Beans Foundation, with Oxfam Novib and KIT, ran a randomized experiment (2023-2025) across 599 households in Daloa and Man regions, testing three intervention packages: Cash Only (EUR 400 unconditional transfer + intensive EBDM training), Services Only (subsidized pruning, agroforestry, VSLAs, GALS training), and Cash & Services combined.

All three packages improved cocoa production and household income, but through different pathways. Cash Only was most effective for immediate liquidity relief, with school expenditure per child rising 272% and EBDM training improving spousal communication and reducing domestic conflict. Services Only had the strongest impact on long-term productivity and gender equity through GALS training and VSLA participation. Cash & Services showed the widest range of impacts across 11 outcome domains, with strongest effects on adaptive capacity, financial inclusion, and women’s empowerment—suggesting integrated models build long-term resilience.¹⁵

Tony’s Open Chain demonstrates that comprehensive, long-term approaches can dramatically reduce child labor. At their three longest-term partner cooperatives (harvesting stage), child labor prevalence fell to just 3.9%—compared to industry averages around 50%. This wasn’t achieved through cash transfers alone, but through integrated Child Labor Monitoring and Remediation Systems (CLMRS), LIRP payments, long-term commitments, and community-level support including schools, water infrastructure, and healthcare facilities funded through the Chocolonely Foundation.¹⁶

ICI Gender & Financial Inclusion Study: Who receives the cash matters

The International Cocoa Initiative’s 2023-2025 study in Ghana tested whether cash transfers have different impacts when paid directly to women, and how combining cash with GALS and VSLA changes outcomes.¹⁷

Critical findings: When women received cash + GALS + VSLA, they gained greater decision-making power, financial independence, and social status. When men received it, farm investments increased but women’s empowerment remained static. The combination of GALS + VSLA significantly improved equitable household decision-making beyond cash alone.¹⁸

VSLAs emerged as critical infrastructure across all programs. These community-led savings groups provided financial access where formal banking is absent, created social capital and mutual support networks, enabled women’s economic participation, and built household resilience against shocks. When combined with cash transfers and GALS training, VSLAs transformed from simple savings mechanisms into platforms for economic empowerment and gender equity.

2025 Price Volatility: Why Market-Dependent Solutions Leave Farmers Vulnerable

The 2024/25 season exposed a critical vulnerability in all market-dependent approaches. Tony’s 2025 impact report showed 40.6% of farmers reached the living income benchmark—more than doubling the previous year’s 19.1%. This validates that the Living Income Reference Price model works when combined with comprehensive support.

But this progress coincided with record farmgate prices. The Ivorian government raised the guaranteed price from 1,800 CFA francs/kg (€2.74) to 2,800 CFA/kg (€4.27)—a 56% increase—hoping to share global commodity market gains with farmers.² Then the crisis hit. As global prices fell in late 2025, exporters (those buying from farmers) refused to buy at the government-set price.³ By early 2026, farmers were being forced to sell cocoa at 2,000 CFA/kg despite the official 2,800 CFA/kg farmgate price, while 123,000 tonnes sat unsold in warehouses.⁴

Understanding who actually benefits from price surges: The structural capture of windfall profits

To understand why price volatility devastates farmers while enriching intermediaries, we need to trace how value flows through the cocoa supply chain and who captures windfalls when global prices spike.

Standard market payment flow (before the 2024 price spike):

The cocoa trade operates through Côte d’Ivoire’s regulated system. The Conseil du Café-Cacao (CCC) pre-sells 70-80% of the national harvest through forward contracts in September/October, locking in prices around $3,500/ton. The government then sets the farmgate price at 60% of this forward contract price—approximately $2,100/ton. Farmers sell to cooperatives at this fixed price, cooperatives deliver to licensed exporters, who ship to processors and ultimately chocolate manufacturers.

In a normal year, value distribution looks like this: Farmers receive $1,660/ton for their beans (earning ~$700 profit after $800 in labor and input costs). Cooperatives add a $140 margin for aggregation. Exporters purchase from cooperatives at $1,800 plus $200 in export taxes, then sell internationally at $3,500/ton—capturing a $1,200 margin. Processors buy beans at $3,500 and sell cocoa butter, powder, and liquor for $5,000/ton ($1,500 margin). Manufacturers then transform these into chocolate products sold at retail for $8,000+/ton.

Of the $8,000 total retail value created, farmers capture just $700 (8.75%).

What happens when global prices surge 380% (April 2024: $2,500 → $12,000/ton):

The forward contract system creates a massive arbitrage opportunity for exporters while completely excluding farmers from windfall gains. Here’s how:

In September 2023, exporters obtained licenses from the CCC based on forward contracts at $3,500-4,000/ton. The government set the farmgate price at 60% of these forwards: approximately $2,100/ton for the entire main season (October 2023-March 2024). This price was locked in—farmers could not negotiate and had no mechanism to benefit from future price movements.

By April 2024, global cocoa futures hit $12,000/ton (a 380% increase from the previous year) due to supply shortages from climate damage and disease. But the forward contract system meant exporters had already committed to deliver 70-80% of their inventory at $3,500-4,000/ton. Crucially, the remaining 20-30% could be sold at spot market prices.

The exporter windfall calculation:

Consider a major exporter (Barry Callebaut, Cargill, or Olam) with a 500,000-ton annual position:

• 70% forward-sold (350,000 tons): Purchased from cooperatives at $2,100/ton, sold via forward contracts at $3,500/ton = $1,400/ton margin = $490M profit

• 30% spot sales (150,000 tons): Purchased from cooperatives at $2,100/ton (same farmgate price!), sold at spot market $12,000/ton = $9,900/ton margin = $1.485B profit

• Total profit: $1.975B (vs. $600M in a normal year) = 3.3x windfall

Meanwhile, the typical farmer experienced this:

• Production declined 20% due to adverse weather and disease: 1.16 tons → 0.93 tons

• Main season sales (75% of annual production): 0.70 tons × $1,637/ton = $1,145

• Mid-season sales (25% of production): 0.23 tons × $2,455/ton = $565 (government finally raised price in April 2024, but only for the smaller mid-crop)

• Total annual income: $1,710 (vs. $1,926 in a normal year)

When global prices increased 380%, farmers’ income declined 11%.

The $9,500/ton additional value created by the price spike was distributed as follows:

• Exporters captured: $6,500/ton (68% of windfall)—buying at locked farmgate prices, selling 20-30% at spot

• Processors captured: $4,000/ton (42%)—charging higher prices for cocoa butter/powder

• Speculators captured: 380% returns—hedge funds betting on futures contracts

• Manufacturers: $2,000/ton (21%)—partially hedged, passed costs to consumers

• Farmers received: $340/ton (3.6%)—and only in mid-season when government belatedly raised prices

Why exporters refused to buy at the raised farmgate price (October 2025):

By October 2025, the government attempted to share windfall gains with farmers by raising the farmgate price to 2,800 CFA/kg ($4,581/ton)—a 56% increase. But global prices had already begun falling (down to $7,000-10,000/ton from the $12,000 peak). Exporters who had forward-sold most of their inventory at $3,500-4,000/ton now faced a devastating calculation:

• Must pay farmers: $4,581/ton (government-mandated)

• Forward contracts pay them: $3,500-4,000/ton

• Loss per ton: $581-1,081

Their rational response: refuse to purchase. The result was 123,000 tonnes of unsold cocoa accumulating in cooperative warehouses, farmers forced to sell at unofficial prices of 2,000 CFA/kg ($3,273/ton) despite the official guarantee, and a government buy-back scheme costing 280 billion CFA francs.

The structural mechanisms that exclude farmers from price upside:

Three features of the CCC-regulated system ensure exporters capture windfalls while farmers absorb all downside risk:

1. The forward contract lock-in: Farmgate prices are set based on forward contracts signed months before harvest, not spot market conditions. When global prices spike mid-season, the farmgate price cannot adjust. Farmers sell at the pre-determined price while exporters sell their non-contracted portion at spot prices.

2. Bi-annual price setting with 6-18 month lags: The government sets farmgate prices only twice per year (October for main season, April for mid-season). The April 2024 price spike took 18 months to meaningfully reach farmers (October 2025 price increase), by which time global prices were crashing.

3. Exporter veto power: Exporters can simply refuse to buy when the farmgate price exceeds their forward contract proceeds. Farmers cannot store cocoa long-term (lacking infrastructure and facing spoilage), cannot access spot markets directly, and cannot negotiate. They must sell immediately at whatever price they can get.

This is not a market failure—it’s how the market was designed. The forward contract system serves exporters’ need for price hedging and risk management. The 60% farmgate formula ensures government export tax revenue. The bi-annual price setting provides administrative simplicity. Farmers’ exclusion from windfall gains is a feature, not a bug.

Farmers who briefly reached living income during the price spike are now falling back. The 40.6% success rate was achieved during an unsustainable commodity boom. Even at peak prices, 59.4% of farmers at Tony’s three long-term partner cooperatives remained below the benchmark, with most earning 61-99% of the target.

Nestlé’s program experienced similar volatility impacts. Despite higher cocoa prices compensating for lower production volumes in 2023/24, farmers became more dependent on cocoa (59% vs 52% income share), making them more vulnerable to future price crashes.

What this means: Even best-in-class programs—Tony’s premium pricing, Nestlé’s conditional cash, EnRoute’s integrated services—can’t protect farmers from commodity price swings without broader systemic change. The pilots have proven that paying living income prices is commercially viable, that transparency builds trust, and that the frameworks work. But they’ve also proven something equally important: even the industry’s most progressive models can’t solve a $4.91 billion systemic problem when operating at a ~$60 million annual scale (€7M Tony’s + ~$53M Nestlé combined). The gap is too large. The number of farmers too many. The commodity price volatility too extreme.

The Integration Imperative: Why Holistic Solutions Matter

These pilots reveal a clear pattern: cash transfers alone are necessary but insufficient. Progress fades without complementary support.

The successful formula emerging from these pilots:

1. Cash for immediate relief (closing current income gaps) — All programs showed cash drives resilience and enables investments

2. GALS for gender equity (transforming household power dynamics) — ICI study proved women’s empowerment requires intentional targeting

3. VSLAs for financial resilience (building savings and social capital) — Critical infrastructure across all successful interventions

4. Productivity support (increasing cocoa income sustainably) — 18% yield gains in Nestlé program, but reinforced cocoa dependency

5. Income diversification (reducing cocoa dependency) — The missing piece: no program achieved this despite efforts

6. Digital payment infrastructure (ensuring cash actually reaches farmers) — Implementation challenge that cut Nestlé’s impact by 64%

The scale challenge remains: These pilots collectively reached ~60,000 households—less than 5% of Côte d’Ivoire’s 1.2 million cocoa farming households below living income. The programs demonstrate what works at pilot scale, but the gap between proven interventions and national transformation is a chasm that premium programs and conditional cash cannot bridge alone.

Recall the typical cocoa farming household introduced earlier: even with generous premiums (Fairtrade + Living Income of $736/ton), farmers producing 1.16 tons annually earn just $2,803—leaving a $4,047 gap to the $6,850 living income benchmark. The premiums help, but they close less than a third of the total deficit.

This is a volume problem, not just a price problem. Farmers produce 1-2 tons per year. Even doubling the premium per ton still leaves them far short of living income.

The fragmentation challenge:

• Tony’s Open Chain: 20 Mission Allies, ~30,000 farmers reached

• Total certified farmers across all schemes: ~50,000-100,000

• Coverage: 3-7% of Côte d’Ivoire’s 1.5 million farmers

• The other 93-97%: No path to living income

Each company pays premiums only for beans they purchase, only to farmers in their certified supply chains. This creates:

• Coverage gaps: Vast majority of farmers outside certified systems

• Inefficiency: 20+ different premium programs, each with administrative overhead

• Competition for certified farmers: Multiple buyers competing for same limited pool

• Restrictive incentives: Farmers must sell to specific buyer to get premium, reducing market flexibility

• Unpredictability: Premiums vary by buyer, season, volume delivered

• No leverage: Only private sector money, no multiplication effect

Result: Lots of pilot projects, zero systemic impact. The 95% of farmers outside certified supply chains have no mechanism for improvement.

Certification schemes show similar limitations:

The broader sustainability certification landscape tells the same story:

• RSPO (palm oil): Associated with reduced deforestation, but primarily on plantations where remaining forest areas were already small, yielding minimal net avoided deforestation compared to total sector deforestation.¹⁹

• Rainforest Alliance/UTZ (cocoa): Studies show “mixed and modest” impacts on productivity and incomes. Good Agricultural Practices can enhance outcomes, but only if structural barriers (return-on-investment uncertainty, access to finance) are addressed.²⁰

The pattern is clear: voluntary, fragmented approaches reach 5-10% of producers and generate modest improvements within that subset. They cannot and will not achieve systemic transformation.

PART 2: A New Framework - Quantifying Shared Responsibility Across Supply Chains

The current system externalizes costs. Farmers bear the burden of poverty, children work instead of attending school, forests disappear. Meanwhile, chocolate companies and consumers enjoy products priced as if these costs don’t exist.

In this section, this framework will show how private sector shared responsibility contributions can cover $2.86 billion annually (58.26% of the $4.91 billion total income gap). The remaining 41.74% will be addressed through public financing mechanisms in Part 3.

What if one could quantify how much buyers benefit from this arrangement? And what if that calculation could determine fair contributions to fixing the system?

Recent research on palm oil supply chains offers exactly this: a method for estimating shared responsibility based on who benefits most from externalizing social and environmental costs.

Palm Oil Research: A Quantifiable Framework for Shared Responsibility

Overview of the research approach:

In a 2025 paper published in the Journal of Cleaner Production, researchers from Copenhagen Business School, Lafayette College, and the University of London developed “A method for estimating buyers’ shared responsibility for oil palm expansion.”²¹

The framework has three key components:

1. Estimate ecosystem service losses: Calculate the value of greenhouse gas emissions from deforestation for oil palm expansion using carbon pricing

2. Attribute costs spatially: Link emissions to specific production regions/concessions meaningful for buyer sourcing decisions

3. Allocate responsibility between value-chain actors: Use market surplus analysis to determine fair burden-sharing between buyers and sellers

How buyer surplus calculations allocate responsibility:

The breakthrough insight: When environmental costs aren’t internalized, both buyers and sellers benefit economically from the transaction. The question is: who benefits more?

To answer this, the researchers analyzed actual transaction data from the RSPO Credits marketplace (PalmTrace):

• 6,220 observations from 2017-2022

• 3,180 bids, 3,040 offers, 361 completed transactions

• Bid prices reveal what buyers were willing to pay

• Offer prices reveal what sellers were willing to accept

• Actual prices show where transactions cleared

Using standard economic surplus analysis, they calculated:

• Buyer surplus: Difference between what buyers would have paid and what they actually paid

• Seller surplus: Difference between what sellers received and minimum they would have accepted

The shared responsibility coefficient (β):

β = (Total buyer surplus) / (Total buyer surplus + Total seller surplus)

Result: β_palmoil = 0.4303 (43% buyer responsibility, 57% seller responsibility)

This coefficient represents the fair allocation based on who captures more economic value from a system where environmental costs are externalized.

Indonesia palm oil example with numbers:

The researchers applied this framework to recently available Trase Indonesia Supply Chain data estimating gross emissions from land conversion to industrial oil palm (2001-2022).²²

Using a carbon price of $24.18/ton CO2e (median global compliance market price, World Bank 2024):

• Total buyer shared responsibility: $5.8 trillion cumulative (2001-2022)

• Annual average: ~$264 billion/year

• As percentage of palm oil production value (2018-2022): ~3%

Key insight: Even with conservative carbon pricing and restrictive definitions (only direct emissions from concessions, only aboveground biomass in the simplified examples), the values are substantial, representing approximately 3% of palm oil production value across Indonesia.

The framework demonstrates that shared responsibility can be quantified, attributed, and allocated fairly using real market data and established economic principles.

Translating the Framework to Cocoa - With a Critical Difference

Adapting the methodology but redirecting its purpose:

The palm oil research calculated responsibility for historical emissions: past environmental damage from deforestation. While scientifically robust, this creates a backward-looking liability framework: “You caused this damage, you owe compensation.”

This proposal takes a fundamentally different approach: It adapts the calculation methodology but applies it to ongoing crises and future solutions, not historical blame.

Here’s why this matters:

Palm oil framework (backward-looking):

• Calculates emissions from past land conversion (2001-2022)

• Assigns responsibility for historical damages

• Creates defensive posture: “You’re blaming us for history”

• Companies resist: liability, legal exposure, historical culpability debates

Our cocoa framework (forward-looking):

• Calculates current living income gap affecting 1.2M households now

• Calculates ongoing forest loss happening today

• Assigns responsibility for future solutions

• Creates collaborative posture: “Let’s fix this together going forward”

• Companies align: investment in viable future, not penance for past

This isn’t semantic; it’s strategic. I believe focusing shared responsibility on protection, restoration, and living wages is more effective than historical compensation. Value chain actors may be more motivated to correct current social injustices and ongoing illegal/unethical labor practices while simultaneously regenerating forests than to pay for historical damages they’ll endlessly contest.

Zero allocation to “compensation for historical damages.”

This is not a liability fund. It’s an investment fund in a viable cocoa sector.

The adapted framework:

The framework keeps the rigorous calculation method but changes what is measured:

• Palm oil: Emissions from deforestation (environmental externality)

• Cocoa: Living income gap (social externality)

• Common principle: Both are costs externalized by the market that buyers and sellers should share responsibility for addressing

Three allocation factors for cocoa buyers:

1. Share of cocoa sourced from high-risk origins

   • What percentage of Côte d’Ivoire production does each buyer source?

   • This determines proportional exposure to the living income gap

2. Historical reliance on pricing below living income

   1. How long has the buyer been sourcing from these origins?

   2. Not to assign blame, but to recognize cumulative benefit from the current system

3. Growth trajectories in demand

   1. Is the buyer increasing or decreasing sourcing volumes?

   2. Future responsibility scales with future demand

Creating Buyer-Specific “Living Income Responsibility Shares” and why this changes everything

The shared responsibility framework requires three calculation steps, but only the third step represents a true departure from current practice. Understanding this distinction is critical.

STEP 1: Determine buyer’s sourcing footprint (Similar to current practice)

Example: Major Chocolate Company A

• Annual sourcing from Côte d’Ivoire: 100,000 tons

• Côte d’Ivoire total production: ~2.2 million tons/year

• Buyer’s market share: 4.5%

This is basic accounting. Tony’s Open Chain and others already track this.

STEP 2: Apply shared responsibility coefficient (β) (Cocoa-specific calculation)

Developing a commodity-specific coefficient from actual market data:

Rather than relying on a palm oil proxy, we calculate β directly from Côte d’Ivoire’s cocoa market structure using the 2023/24 main season forward contract system.

The calculation methodology:

Following Jakob et al. (2021) and Pasaribu et al. (2025), buyer responsibility reflects the economic surplus captured when externalities (living income gaps) are not priced in:

β = Buyer Surplus / (Buyer Surplus + Seller Surplus)

Using 2023/24 forward contract data:

1. Forward contract price (Sept/Oct 2023): $4,000/ton (CIF, upper limit)

2. Locked farmgate price: $2,400/ton (60% of forward, locked for 6-month main season)

3. Actual market price (median, Oct 2023-Mar 2024): $5,750/ton

Calculation:

• Buyers paid farmers: $2,400/ton (locked farmgate)

• Buyers sold at market: $5,750/ton (median during main season)

• Buyer surplus: $5,750 - $2,400 = $3,350/ton

• Seller surplus: $2,400/ton

• β_cocoa = $3,350 / ($3,350 + $2,400) = 0.5826 (58.26%)

This empirically-derived coefficient replaces the palm oil proxy (0.4303) with cocoa-specific data reflecting the actual surplus distribution in Côte d’Ivoire’s forward contract system.

The long-term incentive alignment: This framework creates a powerful market dynamic—as farmgate prices rise (whether through improved contract terms or government pricing), the living income gap shrinks, which directly reduces buyers’ shared responsibility contributions. This aligns buyers’ economic interests with raising contract and farmgate prices over time, as every dollar increase in farmer income reduces their proportional obligation to the fund. Unlike premium systems where higher prices simply mean higher costs, shared responsibility converts price increases into reduced burden sharing.

Apply to example company:

• Total country gap: $4.91 billion/year

• Buyer’s market share: 4.5%

• Buyer’s share of gap: 4.5% × $4.91B = $221M

• Buyer’s responsibility (β=58.26% coefficient): $221M × 0.5826 = $128.7 million/year

This provides a fair, empirically-grounded allocation based on actual cocoa market dynamics.

Differentiating Value Chain Actors: Allocating Responsibility Where Power and Profit Reside

The 58.26% buyer responsibility coefficient provides a science-based foundation, but the cocoa value chain requires further differentiation. The term “buyer” obscures significant differences in market power, margin capture, and windfall benefits among value chain actors.

Applying surplus-based burden sharing (Jakob et al., 2021):

Following the methodology in Pasaribu et al. (2025), responsibility among buyer tiers should be allocated based on economic surplus captured—the value each actor gains from participating in a market where social costs (like living income gaps) are not internalized. The 2024/25 cocoa price surge provides empirical evidence of this surplus distribution.

The 2024/25 price spike analysis: When global cocoa prices quadrupled from $2,500 to $12,000 per ton, the $9,500/ton windfall was captured as follows:

• Exporters/Traders: $6,500/ton surplus (68% of windfall)

• Processors: $4,000/ton surplus (42% of windfall)

• Manufacturers: $2,000/ton surplus (21% of windfall)

• Farmers: $340/ton (+3.6%), while income actually declined 11% in real terms

(Note: Total exceeds 100% due to ownership overlap between processors and manufacturers)

Calculating delta (δ) coefficients:

Following the supply chain burden-sharing framework (Pasaribu et al., 2025, Equations 14-15), each tier’s share equals their surplus divided by total downstream surplus:

δ₁ (Exporters) = $6,500 / $12,500 = 52% δ₂ (Processors) = $4,000 / $12,500 = 32% δ₃ (Manufacturers) = $2,000 / $12,500 = 16%

This surplus-based allocation (52%/32%/16%) reveals that exporters, who captured the majority of windfall profits during price volatility, bear proportionally greater responsibility for addressing the living income gap that enabled those windfalls.

Three distinct actor categories within “buyers”:

1. Exporters/Traders (52% of private contribution = $1.49B/year):

These companies—Barry Callebaut, Cargill, Olam Food Ingredients, ECOM, Sucden, Touton, and 103 others—hold Côte d’Ivoire export licenses and control the forward contract system. During the 2024/25 price surge, they captured $6,500/ton (68% of windfall) by purchasing from cooperatives at locked farmgate prices while selling into spot markets. Their 52% allocation reflects this dominant surplus capture, control over export licenses and forward contracts, and ability to refuse purchases when government-set prices become “uncompetitive.”

2. Processors (32% of private contribution = $915M/year):

Processing operations that grind beans into cocoa butter, powder, and liquor captured $4,000/ton (42% of windfall) through expanding crushing margins during the price spike. This category applies only to processors operating separately from exporters (many major exporters own processing facilities and are allocated under the exporter tier to avoid double-counting). Their 32% allocation recognizes the substantial value they extract from the processing stage.

3. Manufacturers/Brand Companies (16% of private contribution = $458M/year):

Chocolate manufacturers—Mars, Mondelez, Nestlé, Hershey, Ferrero, Lindt, and others—captured $2,000/ton (21% of windfall) during the price spike, partially protected by forward contract hedging. While they captured a smaller windfall portion, they benefit from retail margins on products priced as if farmers earned living wages. Their 16% allocation recognizes brand responsibility and consumer-facing accountability while not over-burdening them relative to actual surplus capture.

Allocation methodology:

Each company’s contribution is calculated based on their market share of Côte d’Ivoire cocoa in their respective tier:

Example - Exporter Tier (52% of $2.86B = $1.49B):

• Company with 500,000 tons (22.7% of 2.2M ton CI production)

• Contribution: $1.49B × 22.7% = $338M/year

Example - Processor Tier (32% of $2.86B = $915M):

• Company processing 300,000 tons CI cocoa (13.6% market share)

• Contribution: $915M × 13.6% = $124M/year

Example - Manufacturer Tier (16% of $2.86B = $458M):

• Company sourcing 200,000 tons CI cocoa (9.1% market share)

• Contribution: $458M × 9.1% = $42M/year