Clean tech can check the worst impacts of climate change

Amid the torrent of bad news about climate change, a positive trend is emerging. Clean-tech companies are attracting unprecedented levels of funding, marking a paradigm shift within the investment landscape towards sustainability.

Innovative sustainable finance is playing a crucial role in supporting efforts to improve clean-energy access and to reduce carbon emissions. It often serves as a lifeline for developing nations, as governments from the developed world alone cannot raise sufficient funds to assist poorer nations as they grapple with a hotter planet and transition to renewable energy.

One clean-tech pioneer that illustrates the impact of such sustainable financing is UK-based Bboxx, which produces, delivers and finances decentralised solar-power solutions to customers in off-grid areas across Africa.

With a US$100m investment from EnerTech–a subsidiary of the Kuwaiti government–Bboxx aims to expand its reach tenfold, bringing electricity to an estimated 36m people across sub-Saharan Africa by 2028. This exemplifies the power of collaboration between public investors and clean-tech innovators to address energy poverty and drive positive social change in the global south.

Another trailblazer can be found in Uganda, where US-based firm d.light–which manufactures and distributes solar lighting products and modular solar home systems–is showing how clean-tech companies can leverage public grants to make renewable energy accessible to underserved communities.

Drawing on grants totalling US$148m, d.light aims to subsidise the prices of its clean cooking stoves, solar home systems and solar lanterns. Backed by the Ugandan government, the company leverages a results-based approach in which funding is released once certain sales targets are achieved, aligning financial incentives with environmental and social impact.

Driving environmental and social change

The shift towards sustainable financing is not confined to the public sector. German-based solar storage manufacturer sonnen, acquired by Shell in 2019, is poised to be sold again at a valuation of up to US$1.9bn, according to newspaper Handelsblatt.

Founded in 2010, sonnen has grown into a market leader and is actively involved in constructing the largest virtual power plant in Europe. The plant’s current 250MWh capacity is expected to increase to 1 GWh in the coming years, enabling the German electricity network to manage power grid frequency fluctuations and engage in electricity trading on the stock exchange. A US$1.9bn valuation would be four times the value of sonnen’s estimated 2023 sales, underscoring the rising value of clean-tech companies and the positive trajectory of the industry, fuelled by robust private investment.

These success stories illustrate a growing trend: clean-tech companies are not only pioneering environmental and social solutions, but also reshaping the financial landscape. All three of these firms are impacting the communities they serve, and should be models for sustainable development across the world.

They also have something else in common: all three are previous winners of the Zayed Sustainability Prize, the United Arab Emirates’ global award for sustainability and humanitarianism, and all have used the funding and publicity to follow through on their vision for a better future. The Prize, which now offers winners US$1m each across categories including Health, Food, Energy, Water and Climate Action, contributes to the financing ecosystem for clean-tech companies and organisations committed to tackling global issues. It also demonstrates the commitment of the UAE’s leadership on sustainability and its contribution to supporting sustainable development around the world.

Research shows that the impacts of climate change are happening faster than anyone imagined. But change is under way. Global leaders at COP28 in Dubai in December agreed for the first time to move away from carbon fuels, adopting the landmark UAE Consensus for climate change. Many hope that this is the start of a new era, and that more clean-tech innovators can secure the financial backing and support they need to drive positive change.