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Europe’s big climate VC bet

Protocol Climate

Hello, Protocol Climate friends. Today, we’re globetrotting (sustainably, of course) by checking in with Europe’s biggest climate VC fund on what makes the continent a clean tech startup hotbed before hopping back to the U.S. for Big Tech’s take on the Inflation Reduction Act. Then we’re zooming out for a global view of Amazon’s carbon emissions.

The state of European climate tech investment

American venture capital and startups may get the spotlight when it comes to climate tech. But their European counterparts aren’t exactly slouches. World Fund, Europe’s largest dedicated climate tech VC, launched last year with a €350 million target.

There’s no shortage of investments for World Fund to make. There were more climate tech companies founded in Europe between 2019 and 2021 than in the U.S. and China combined (102 vs. 80), according to the VC firm’s analysis. I sat down with Danijel Višević, a founding partner at the fund, to explore how it’s filling a critical gap in the startup investment ecosystem.

Even apart from climate concerns, the Russia-Ukraine war has made it painfully clear that reducing the world’s reliance on fossil fuels is more critical than ever. That can’t be done without transformative climate tech.

World Fund is investing in solutions. Big ones. The VC firm has set a goal of investing in companies that will collectively save 2 gigatons of greenhouse gas emissions by 2040.

  • How it plans on getting there is by following a strict mandate: only investing in companies that have demonstrated the potential to reduce greenhouse gas emissions by at least 100 megatons of carbon dioxide every year.
  • That’s a tall order for a single VC firm. Two gigatons — that is two billion tons — is roughly 4% of the world’s annual greenhouse gas emissions. But World Fund isn’t alone in its ambitions.
  • Chris Sacca’s $350 million Lowercarbon Capital fund has said it’s targeting carbon removal startups with “gigaton-scale impact.” Bill Gates’ Breakthrough Energy says it invests in companies with the potential to cut carbon pollution by 500 megatons a year.

Five sectors are central to World Fund’s ambitions. The firm believes that energy, transport, food and agriculture, manufacturing and buildings are where it can get the most decarbonization bang for its buck.

  • Agriculture is one of the biggest emitters on earth, particularly animal agriculture. World Fund has invested in QOA, a Munich-based startup that creates lab-grown cocoa, as well as Juicy Marbles, the much-hyped fake steak company. “We are pretty sure we’ll replace a lot of the food that we eat today,” Višević said, adding that World Fund is specifically targeting “everything that can replace eating meat.”
  • It’s not just those five sectors that matter to World Fund, though. Quantum computing is also coming onto its radar.
  • Višević said it can be used to accelerate the development and production of longer-lasting car batteries and has the potential of reducing yearly emissions by up to 7 gigatons. Last month, World Fund announced it had led a €128 million series A2 investment in European quantum computing firm IQM.

Venture capital is only one part of the climate recipe for success. Višević highlighted three key principles that could help accelerate the development and deployment of climate-saving technology.

  • Public spending and government support, which Europe currently has in droves, are a key piece of the puzzle. “We didn't have that 10 or 15 years ago. Now we have that,” Višević said. He pointed to programs like InvestEU, the European Innovation Council and the European Commission’s Horizon Europe fund.
  • Expertise in not just money but science is also vital for VC success. In Višević’s view, “VCs are not investing into climate tech as they should and could, although they have the capital. One major reason is they don't understand those deep technologies.” Many VCs are ex-BCG, ex-McKinsey, but not many are ex-scientists. World Fund’s roster includes scientists, mechanical and chemical engineers and physicists, as well as a mathematician.
  • Finally, investors need to play a long game. There’s often a fundamental disconnect between a climate tech startup’s time horizon and what VCs expect in terms of returns. Complex technologies like the ones World Fund has invested in require time and money to build labs, invest in R&D and scale without immediate profitability. “We don’t invest in three years, and then the project is done,” founding partner Daria Saharova said in a Collision panel last month. Instead, World Fund thinks “in the mid- and long-term,” investing in startups that “are going to be the champions of the next decade and maybe even longer than that.”

— Michelle Ma (email |twitter)

Big Tech’s big silence on the IRA

Tech companies have talked up their climate plans. But when it comes to Democrats’ newly unveiled Inflation Reduction Act, which includes nearly $370 billion in climate spending, the tech industry has been largely silent. In fact, trade groups many tech companies are members of have come out in opposition to parts of the bill, notably the 15% corporate minimum tax.

The legislation is a test of Big Tech’s climate commitments. So far, companies aren’t making a strong showing.

  • Despite their lofty net zero commitments, no major tech companies outside of Salesforce have issued statements in support of the Inflation Reduction Act of 2022. Their silence says a lot, but so, too, does the opposition from major trade groups that count Big Tech among their ranks.
  • The Business Roundtable — a major lobbying group whose members include Tim Cook, Andy Jassy, Sundar Pichai, Satya Nadella, Marc Benioff and Ted Sarandos — issued a statement on Thursday saying that it “strongly opposes” legislation that would raise taxes, a slight at the IRA. The group urged Congress to reject “harmful tax increases.”
  • The U.S. Chamber of Commerce, whose many dues-paying members also include the tech industry, also issued a strongly worded statement opposing the budget reconciliation bill, arguing that it would “discourage investment and undermine economic growth and innovation.”
  • Both groups were mum on the climate parts of the bill, though the taxes are a key component to ensure the legislation fits within the reconciliation process.

Tech companies appear to want it both ways. In addition to its membership in Business Roundtable, Google is also part of the Drawdown Labs consortium, which bans lobbying against climate change measures as a condition of membership. (Netflix was a Drawdown Labs member as well, but left a few months ago.)

  • There’s “unequivocally” a divergence between tech companies’ public climate commitments and what they’re actually willing to give up to turn those commitments into actions, said Jamie Alexander, director of Drawdown Labs.
  • Tech companies may, of course, still be advocating for the legislation behind closed doors. The anti-IRA rhetoric is “largely coming from trade associations themselves and not companies,” Zach Friedman, the director of federal policy at climate finance nonprofit Ceres, said. He added that there is “definitely some misalignment between companies and these trade associations.”
  • Yet Drawdown Lab members have shown reticence to engage in relatively modest calls for climate action before even as they trumpeted their big climate goals in press releases.
  • A Meta rep told Protocol the company doesn’t have a comment at this time on the bill. Apple, Google, Microsoft, Amazon and Netflix did not respond to requests for comment for this piece nor did they offer comment last week after the bill was released.

With 49 Democratic senators ostensibly lined up to vote for the Inflation Reduction Act, the trade groups appear to be targeting the vote of Sen. Kyrsten Sinema. She has yet to say if she’ll vote on the bill, and while she has generally been supportive of climate legislation, she has taken the side of big business when it comes to taxes.

But a corporate minimum tax — one which 136 nations, including the U.S., have agreed to as part of the OECD no less — should be the least of business’ worries when it comes to their bottom line. “There’s no bigger threat to economic growth than climate change,” Alexander said.

— Michelle Ma


The emissions that make up a full greenhouse gas footprint can emanate from outside the four walls of your own manufacturing operations, like in the case of PepsiCo, where 93% of emissions come from its value chain.

Learn more

One big number: 18%

Stop me if you’ve heard this one before: A major tech company is failing to deliver on its climate promises. Amazon has made a big to-do of getting to net zero by 2040, but it keeps making its own path steeper. In its new sustainability report, the world’s largest retailer revealed that its emissions rose 18% year over year.

In the report, the company touted its economic growth and scale before noting, “[w]ith all of our growth in 2021, our absolute carbon emissions increased by 18% in 2021.” The report sheepishly adds that Amazon cut its carbon intensity by 1.9%, the third year in a row the figure has dropped. That’s nice for Amazon, but the atmosphere doesn’t hand out gold stars for effort.

The company’s Scope 1, 2 and 3 emissions amounted to a whopping 71.5 million metric tons of carbon dioxide equivalent (a metric that standardizes greenhouse gas emissions) in 2021. Scope 2 emissions — those tied to electricity purchases — are the only ones that fell. Amazon’s emissions tied to fossil fuels have exploded; they’re now more than double where they were in 2019, which reflects the rise of online shopping since the beginning of the pandemic era that shows no signs of ebbing.

The company’s Scope 3 emissions have also ballooned, particularly those tied to buildings, its AWS servers and other equipment that keeps Amazon humming. Year-over-year, those rose 46% and are essentially double what they were in 2019 as well. Scope 3 emissions are the biggest source of Amazon’s — and most other companies’ — emissions, and they’re ones that could be well-addressed by legislation and federal investments that decarbonize the grid. Yet the company is among the tech giants that have remained mum on the Inflation Reduction Act, which could cut U.S. emissions by up to 41%.

“We thrive on big challenges,” the report says more than once. And with its emissions on the rise, that sure appears to be true.

— Brian Kahn

Hot links

Here come the baby nukes. The Nuclear Regulatory Commission is set to certify NuScale’s small modular reactor, making it the first SMR to receive approval in the U.S. The first module is slated to go into operation in 2029.

Pour one out for blue hydrogen. The fossil fuel industry has advocated for making hydrogen using methane gas. But turns out the economics aren’t so hot. (To say nothing of the climate impacts!)

Europe’s ESG dream is turning into a nightmare. While the rulebook is moving forward, the “S” (that is, social) part of it is mired in infighting, which will lead to implementation delays.

Transformers wanted. No, not the Michael Bay version. As hurricane season looms, power companies say that wait times for the technology have quadrupled, further raising the chances that storms will result in long power outages.

Drinking water is getting a cybersecurity upgrade. The EPA is set to require states to integrate cybersecurity into surveys of the nation’s water facilities.

Ridding the nation of EV charging deserts will require billions of dollars, and a willingness to put chargers where they aren’t immediately needed.


Asking suppliers and associated companies to overhaul the way they work is no small feat, but PepsiCo is taking a three-pronged approach centered around the principles of educating, enabling and incentivizing. The Sustainability Action Center aims to engage and equip value chain partners with tools to undergo their own sustainability journey.

Learn more

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