Green | Battery Week

How 12 Climate Tech Startups Are Shaping the $2.3 Trillion Energy Transition

These companies have won BloombergNEF’s annual Pioneers competition for the most promising climate tech.

By Coco Liu and Brian Kahn

Illustrations by Rose Wong

International climate ambition has faltered since the start of President Donald Trump’s second term. Yet funding for the global energy transition climbed to a record $2.3 trillion in 2025.

That surge was buoyed by soaring interest in technologies that generate clean energy and strengthen power grids. Both are needed to support data centers’ expansion and feed the world’s growing appetite for artificial intelligence. The S&P’s main clean energy and grid tech indexes have also outperformed most other stock indexes over the past 12 months. With the Iran war now shining a spotlight on the risks of continuing to rely on fossil fuels, clean tech could get a bigger boost. This year’s BloombergNEF Pioneers awards have identified 12 climate tech startups flourishing amidst this chaotic backdrop.

BNEF chose three challenges: powering data centers; balancing energy supply and demand; and cleaning up heavy-duty transport, and the winning companies are forging solutions in these areas. Taken together, the winners show that the world increasingly runs on electrons, and there’s a strong business case to keep funding the energy transition.

We’ve historically referred to cutting emissions as “net zero goals,” said Claire Curry, BNEF’s global head of technology, industry and innovation. But as the war has shown, a lot of the energy transition “is about domestic security and supply” for Europe, India and China.

Global electricity demand tied to AI is on track to quadruple within a decade, benefiting companies whose technology not only cuts emissions but puts new power on the grid. And as data center operators build more wind and solar projects to power their facilities, pressures are also mounting for utilities to balance energy supply and demand on the grid. That, in turn, creates opportunities for anyone working to install energy storage batteries or develop smart load management software.

Shipping and heavy-duty transport is another area where relying on molecules alone is a risky proposition with fuel costs soaring. On land, electric options are rapidly proliferating, particularly in China. The country saw nearly 78,000 medium- and heavy-duty electric trucks sold in the fourth quarter of 2025 alone — though some subsidies have been phased out and growth is likely to be somewhat slower this year. At sea, electric large ships remain years, if not decades, away. But low-carbon fuels and other technologies from reducing friction to harnessing the wind are mature enough to be deployed today.

Despite signs of progress, the transition isn’t happening fast enough. Big tech companies have spent billions of dollars sponsoring clean energy projects, but their emissions keep rising. And countries have agreed to a global carbon tax on shipping, only for it to be held up by pressure from the Trump administration.

The annual Pioneers awards winners were selected from a pool of 611 entries that were reviewed by a group of experts, including Bloomberg Green editors.

As the popularity of AI tools grows, so does the energy demand of data centers. Global data centers are expected to use as much as 1,600 terawatt-hours of electricity by 2035, roughly five times what the UK consumed last year, according to BNEF. Besides adding more carbon-free electricity into the global power mix, it is also vital to find solutions that help rein in data centers’ near-insatiable power hunger.

Shifting away from fossil fuel means hooking more wind turbines and solar panels up onto the grid, but a greater adoption of renewable energy comes with its own problems.

One primary challenge is known as the “duck curve,” an illustration that depicts the misalignment in daily electricity demand and available solar power generation throughout the day.

When the sun is shining, solar panels send more electricity to the grid than what’s needed, and then their contribution drops after sunset as electricity needs rise. In places where a substantial amount of solar capacity is installed, such a mismatch leaves utilities no choice but to disconnect solar in midday and install other forms of power generation for evening ramps. That, in turn, hampers the profitability of renewable projects, discouraging investors from building more. But for startups that tackle load management challenges, it also represents an opportunity.

“The duck curve is completely driven by the fact that we haven’t really worked out a way of matching supply and demand” with solar power, said BNEF’s Curry.

Clean transportation is the biggest chunk of the climate tech investing pie. The sector saw $893 billion in funding last year, according to BNEF. Just $53 billion of that went into commercial vehicles. But that represents a 57% increase year-over-year, outpacing every other sector.

“It was unimaginable that you could see a market like that exist today, even five years ago,” said Angie Farrag-Thibault, vice president for global transportation at Environmental Defense Fund, adding that voluntary industry initiatives and a growing number of government policies have helped the clean transport sector quickly get up to speed.

While the path for commercial land transport is clearer, Farrag-Thibault said, there’s still a lot more groundwork that needs to be laid for shipping. That’s reflected in the funding: Clean shipping saw $4.2 billion in investments last year. But that only accounts for ships that run on cleaner fuel, sidestepping other solutions that are more readily available today. To decarbonize all forms of heavy transport requires both deploying technologies that work today and creating the next generation of fuels and resources that can cut emissions further.

Not all Pioneers winners fit into neat categories. But this year’s wildcards provide a glimpse of emerging climate tech sectors and regions, from electric buses in Africa to microbe-assisted copper mining and cutting forever chemicals from batteries.