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Climate tech market glossary

From carbon capture and removal to indoor farming and electric cars, the climate tech sector—one of hundreds of industry verticals tracked by PitchBook—has gained incredible momentum in the last decade. Get familiar with these climate tech terms, a solid foundation for further exploration of the landscape.

From carbon capture and removal to indoor farming and electric cars, the climate tech sector—one of hundreds of industry verticals tracked by PitchBook—has gained incredible momentum in the last decade. A combination of technological breakthroughs and global urgency suggests that now may be the time for investors to confidently commit to the climate investments that will shape the future.

“Though the pandemic has temporarily focused attention on the global health crisis, widespread vaccine distribution should make 2021 the year that climate re-emerges as the top priority for governments worldwide.”

—Ryan Vaswani, PitchBook emerging technology analyst

Climate tech represents a sprawling, multi-trillion dollar opportunity encompassing energy, transportation, agriculture, buildings, industry, climate adaptation and materials and resources. Familiarity with these climate tech terms should provide a solid foundation for further exploration of the broader landscape.

Climate tech market terminology


Micro-mobility encompasses transportation solutions that target the “last mile” problem, where users have difficulty traveling from their current location to a major transportation hub like bus or railway stations, or vice versa. Distances covered by these solutions typically average less than six miles, with bicycles and scooters being the most prevalent form of transportation used to for these trips.

Electric vehicle charging stations include companies building electric vehicle charging infrastructure to support the electrification of the mobility sector. The number of charging outlets has significantly expanded as awareness and adoption of electric vehicles has increased, and this trend is expected to continue and accelerate as large automakers including GM continue to make investments into electric vehicle development.

Biofuel companies are producing an array of fuels generated from renewable biomass.

Electric vehicle platforms are companies developing and manufacturing electric vehicles, powertrains and platforms. Though electric vehicles accounted for a minuscule percentage of automobile sales in 2019, significant growth in the industry is expected as battery technology improves and decarbonization becomes a stronger policy priority. Adoption of electric vehicles is expected to increase as charging infrastructure expands, major OEMs increase investments into the tech and autonomy providers lean toward electric vehicles for their computing advantages.


Q3 2020 Analyst Note: Electric Vehicles Poised to Reshape Auto Industry

Explore how valuations have soared as investors envision the future of electric cars
Download report

Electric flight companies are developing hybrid or all-electric powertrains for electrified aerial transportation. Due to the lower energy density of existing lithium-ion battery technology, startups in electric flight are constrained to short-to-medium distance applications. Despite this limitation, electric flight is viewed as an important research area to help decarbonize overall air transportation, with primary applications in logistics and passenger transportation.

Urban air mobility refers to the use of vertical-take-off-and-landing (VTOL) aircraft in aerial transportation, generally best suited for urban environments. Companies in this space include both air taxi service providers as well as eVTOL manufacturers. Air taxis offer congested urban environments a new mode of transportation that seeks to find the optimal balance between cost and convenience. Additionally, aircraft in this space are almost entirely all-electric, reducing potential concerns over noise and pollution.


Long-duration energy storage technologies aim to improve the ability to store energy from the grid for use on demand, especially as the energy industry expands into renewables. Approaches in this category include flow batteries, compressed air, gravity storage and thermal techniques.

Next-generation battery technology refers to the development of improvements or alternatives to the lithium-ion battery. These improvements and alternatives often involve new materials using advances in chemistry and materials sciences. Improved battery life is expected to enable advances in electric vehicle range, the performance and convenience of consumer electronics and better storage options for renewable energy.

Smart grid refers to technology that allows for two-way communication between power utilities and their customers, enabling a more efficient transmission of electricity.

Renewable energy generation refers to the creation of electricity from sources that produce no carbon emissions. Energy sources in this category include hydrogen, fusion, solar, wind, tidal and wave power, geothermal and nuclear.

Materials and resources

Mining tech includes companies developing technology to assist with the automation, expedition, and yield of mining processes. As the demands for consumer technologies and renewable energy in particular skyrocket, the need for more resources will put greater demands on mining production. The solutions in this space lean on robotics, AI and digital twins among others to help mining companies meet this demand.

Lithium extraction technology includes companies developing novel solutions to mine lithium. With demand for lithium expected to triple by 2025, historical approaches to mining it have been deemed inadequate for modern needs due to slow process times and unsustainable use of water. Newer solutions propose to mine greater yields with less water, often in areas previously considered inaccessible for lithium mining development.

Smart waste management companies are developing technologies to improve the efficiency and effectiveness of traditional waste management. These solutions include waste bins equipped with sensors, database management and logistics platforms, and even robots and computer vision systems that can easily sort trash and recycling.

Reforestation startups in this space are focused on developing technologies and providing services related to reforestation and forestry management. The acceleration of both climate change and biodiversity loss has propelled governments and private actors to respond quickly—in this case by restoring and maintaining trees across the world in areas where they once thrived, enabling more species to flourish and carbon to be captured at greater rates. Types of companies in this space include drone-based replanting, satellite and AI-supplemented imaging and carbon offset programs.

Lithium-ion battery recycling startups are designing technology and processes to recycle lithium-ion batteries more efficiently, especially those that are used in electric vehicles. Due to a combination of economic and technical factors, fewer than 5% of lithium-ion batteries are recycled today. However, these batteries—which are already fairly ubiquitous in consumer tech—are expected to scale up even more as the electric vehicle market expands, potentially creating both a sustainability and an economic opportunity for their recycling.


Carbon capture startups are using a diverse array of technologies to capture, store and/or remove carbon from industrial processes and the environment more broadly. Carbon capture and removal refers to the process of actively capturing carbon atoms and removing them from the atmosphere via storage or utilization in other forms. Carbon capture and removal is one of a series of technologies that investors are pursuing in order to mitigate the effects of climate change. Technologies in this category include afforestation, biochar, carbon sequestration and direct air capture.

Industrial decarbonization processes include companies developing techniques, methods, and technologies that enable fewer carbon emissions from common industrial outputs like steel, concrete, and chemical production. Companies in this space are developing industrial process improvements that produce similar outputs with far fewer or no carbon emissions. Industrial processes are big carbon emitters but adapting to new processes is expensive.

Green hydrogen refers to the production of hydrogen as a fuel through renewable means. The majority of hydrogen today is produced from fossil fuels, largely for cost and energy efficiency reasons. Companies in this space are developing technologies to bring down the costs of producing hydrogen at scale in a carbon-neutral manner.


Regenerative agriculture companies are adopting farming and grazing practices that help to reverse climate change by rebuilding soil organic matter and restoring degraded soil biodiversity, in addition to other benefits. Companies in this space primarily develop programs for encouraging farmers, generally through carbon payment systems, to institute regenerative agricultural practices. This space is seeing increased attention as pressure on the agricultural sector grows to reduce its carbon-intensive processes.

Cellular agriculture focuses on the production of agricultural products from cell cultures using a combination of biotechnology, tissue engineering, molecular biology, and synthetic biology. Companies in this space create and design new methods of producing proteins, fats, and tissues that would otherwise come from traditional agriculture. Most of the industry is focused on animal products like meat, milk and eggs, produced in cell culture rather than raising and slaughtering farmed livestock. The most well-known cellular agriculture concept is cultured—or clean—meat.

Indoor farming refers to the growing of crops or plants in a facility enclosed from the environment, usually on a large scale, using technologies like hydroponics and artificial light. Indoor farming offers the advantage of using a controlled environment that enables year-round growth and produce to be stacked vertically to maximize output in a confined space. Companies within indoor farming include the growers and facilities, the equipment inside and the software to manage them.


Q1 2021 Analyst Note: Cultivating Opportunities in Indoor Farming

Explore how Controlled Environment Agriculture (CEA), also known as both vertical farming and indoor farming, has been identified as a growing strategy that offers many benefits over conventional methods.
Download report


Water scarcity startups are developing solutions to help improve access to and cleanliness of fresh water in drought-prone regions. Climate change, accompanied by increasing deforestation and desertification, is expected to worsen the issue of water scarcity around the world.

Natural disaster preparedness and response companies are developing technologies to assist individuals and businesses vulnerable to natural disasters. With severe weather events growing more frequent due to climate change, these companies offer proactive and reactive measures to help minimize loss of life and property during a disaster. Technologies in this space include AI, drones, and communication platforms and extend to applications like wildfires, floods, earthquakes, and severe storms.

Climate modeling as a service describes companies analyzing climate data with the intention of providing risk assessments to enterprises. As increased global temperatures make weather patterns more unpredictable, these startups aim to provide more stability to businesses risk modeling. Often leveraging AI, applications in this space include flood risk assessment, real estate valuations and agricultural production.

Behavior companies are developing tools that help individuals and businesses adopt climate-friendly lifestyles or practices. For example, by stating on a food label how much carbon was used to produce it, consumers may be more conscious of buying products with fewer carbon emissions.


Buildings include companies advancing technologies that help to monitor and optimize energy usage in commercial and residential buildings.

To dive deeper, explore the hundreds of industry verticals and emerging spaces PitchBook tracks. This article was created with information from PitchBook’s Climate Tech Vertical Snapshot report. PitchBook customers can log in to explore the report in full. Not a customer yet? Request a free trial.