The £42bn ClimateTech Index
Startup Coalition’s second annual ClimateTech Index finds that the top 1,000 ClimateTechs are worth a combined £42bn to the UK economy, providing 27,000 high skilled jobs across the country. Combined, the firms in the 2025 Index have raised £19bn.
The country’s coasts, hills and rivers mean that ClimateTechs are springing up in all four corners of the UK: more than half of the value, funds raised, and jobs provided by ClimateTechs in the Index came from outside of London.
In positive news for Energy Secretary Ed Miliband, the UK is home to a £22bn startup sector decarbonising energy production, distribution and usage, employing over 11,200 people across the UK. These firms are critical to the Clean Power 2030 mission, particularly as many are looking to increase efficiency, increase diversity of supply, and lower household bills. With Monday’s Industrial Strategy including an aspiration to make the most attractive place in Europe to invest in Clean Energy Industries, this Index shows the UK is well set to achieve this goal.
There are, however, a few warning lights for policymakers. The long-term R&D funding settlements announced at the Spending Review couldn’t come a moment too soon, with ClimateTech grant funding in the UK down 50% between 2023 and 2024, according to the most recent data available.
More concerningly, the late stage “valley of death” remains prominent, with firms bunching at the Series A stage. At this stage startups are more likely to fail or falter, as they are often investing in the “first-of-a-kind” factory or commercial scale product, and require significant capital. The data shows that there was a decrease in the number of mega-rounds (over £100m) from six in 2023 to only one in 2024, and a similar drop in the number of large rounds (over £50m) from fourteen in 2023 to four in 2024.
Startup Coalition concludes the Index with three key messages for the Government: the need to embed innovation in its vision for growth; the opportunity for ClimateTech to accelerate the Clean Power 2030 mission; and the need to ensure that red tape is not holding back the low carbon economy.