Project-ready infrastructure has continued to dominate climate financing in the first half of 2026, as power solutions targeting the data center market experienced record growth in private and public markets, according to new data from Net Zero Insights.
Private market climate tech ventures totaled $41.3 billion in the first half of this year, up only slightly compared to the $43.6 billion spent in the first half of 2025. But the make up of the market has changed; in 2026, it’s dominated by fewer, larger deals. The average round size has jumped from $18 million to $27 million.
That’s while the total number of deals dropped to a record low, continuing a capital concentration trend that has been taking shape for the last two years.
In 2024, the amount of private debt for climate tech skyrocketed compared to the prior two years, driven by a handful of unusually large rounds targeting capacity expansion and facility construction. Among those deals was H2 Green Steel’s $5.17-billion raise, which provided additional financing for a planned plant in Sweden.
Now, though, debt volume has settled well below the 2024 peak, but still accounts for roughly a quarter of all climate tech financing; in 2021 and 2022, in contrast, it made up less than 10%.
And it’s the energy sector, still riding the wave of the AI boom, that attracted the most debt financing by far, trailed by transportation.
But it’s not just private debt that’s concentrating. The first half of 2026 has seen the fewest number of equity deals on record, the report found, with the number of deals thinning across early stages, even as round size has grown. Capital is continuing to concentrate at the more mature end of the market.
Seed rounds, for example, have grown rapidly, up 73% in value since 2021, while shrinking to a record-low proportion of equity deals. Series A and B rounds, what’s known as the “missing middle” of the market, have remained comparatively flat for the last two years.
Series C rounds and above absorbed the dominant share of equity capital this year, capturing $7.5 billion in the first half of this year alone. And growth equity funding is on the upswing, ticking up from a low of $1.9 billion in the second half of 2025 to $3.1 billion in the first half of 2026. The number of growth equity deals being signed is also on the rise.
There’s also been a distinct shift in where equity dollars are flowing, compared to 2025. Investment in transportation and energy increased dramatically, while sectors like carbon removal saw a nearly 50% decrease in equity investment.
Public market trends
The exit landscape so far in 2026 has been more active than any six-month period since 2021, with energy companies driving the trend. While the landscape has been dominated by mergers and acquisitions, SPACs — including Swedish electric freight developer Einride’s $220 million listing — are also on the rise.
SPACs accounted for more than 30% of all exits in 2021. They dropped off precipitously between 2022 and 2024, but have been creeping back up — as have climate tech IPOs generally.
The first six months of 2026 have seen more SPACs than any six month period since 2022, a trend that isn’t limited to climate tech: Investors reportedly spent around $30 billion on SPACs last year overall, the most since the 2021 boom.
And those numbers are certain to rise for the second half of this year. General Fusion, the Canadian fusion developer, announced its plans to go public via SPAC back in January. It didn’t hit the market until early July, meaning the $1-billion deal missed the cutoff date to be included in the H1 data.
Though traditional IPOs remain few and far between, two breakout energy IPOs already this year highlighted a window of opportunity for firm, ready-to-deploy power solutions to break the energy IPO stalemate, thanks in large part to the AI boom.
First, small modular reactor developer X-energy debuted on the Nasdaq in April, valued at $11.9 billion. It was followed a few weeks later by next-gen geothermal company Fervo, which went public via a $1.9 billion IPO in May, the first geothermal company to do so in more than a decade — and the largest-ever clean energy IPO.
