Climate capital in H1 2026: $26.1B flows to power for AI, carbon left behind

Currence's H1 2026 report (formerly Sightline Climate, publisher of the CTVC newsletter) puts climate tech venture funding at $26.1 billion, up 55% year on year and the strongest first half since 2022. The headline hides a shift: investors are not returning to climate broadly, they are financing the power infrastructure behind the AI buildout.

A quarter of the money sits in two deals

Low-carbon data center developers captured 34% of all climate venture funding in H1 2026, against 3% a year earlier. Two rounds alone — DayOne's $4.5 billion and Nscale's $2 billion Series C — accounted for roughly a quarter of the sector's total. In the other direction, carbon-related equity funding fell 61% to its weakest first half since 2020.

Other data points the same way on a wider basis. Per Net Zero Insights (via Latitude Media), private market climate tech totalled $41.3 billion in H1 2026, only marginally different from $43.6 billion in H1 2025 — the market is roughly flat in size but sharply reallocated into fewer, larger deals concentrated in power solutions for data centers.

Exits reopen, but only for firm power

Currence also reports a record quarter for cleantech IPOs and acquisitions, with the big deals in low-carbon firm power: Fervo's $1.9 billion IPO in geothermal, plus active dealmaking in advanced nuclear. CTVC's weekly deal list points the same way: $470 million for stellarator fusion systems in Munich and $134 million for geothermal drilling technology in Houston.

• Money follows electrons: generation, cooling infrastructure and data center operations.
• Money leaves narrative: carbon credits and emissions measurement lost 61% of equity funding.
• Liquidity returns selectively: IPOs and acquisitions cluster in firm power that runs around the clock.

For early-stage investors the consequence is that the due diligence bar has changed. A climate startup today is priced on power purchase agreements, operating service contracts or equipment orders — infrastructure cash flows — not on the future potential of carbon markets. That is also why many mid-stage companies with a working product but no commercial-scale deployment struggle to move from Series A to Series B.