"Once-in-a-century investment opportunity": Australian institutions endorse $50 million venture capital fund for climate technology
The Australian climate tech sector is experiencing a surge in institutional investment, driven by recent capital commitments, supportive government policies, and growing corporate demand for clean solutions.
Climate Tech Partners (CTP), a new climate tech fund, recently reached its first close with $30 million in investments, equally split between Australian Ethical and the Clean Energy Finance Corporation (CEFC). This fund focuses on early-stage climate technology companies in sectors like electrification, sustainable fuels, and next-generation grids.
The Australian government's commitment to long-term climate goals is sending a strong signal to innovators and investors. Tom Kline, CTP's co-founder, emphasizes, "The Australian government is committed to long-term climate ambition, which sends a powerful signal to innovators and investors alike."
Breakthrough technologies in climate-related fields are gaining traction, with corporate demand for clean solutions on the rise. For instance, flood mitigation technologies are attractive due to Australia's repeated climate disasters and a $30 billion federal flood defense package, creating a lucrative market for companies specializing in advanced drainage and flood barriers.
While investment in climate tech globally saw a 19% decline in the first half of 2025 due to macroeconomic pressures and policy uncertainties, Australia’s climate tech sector benefits from bipartisan and stable government support, which reassures investors about the durability of these opportunities.
The CTP model for venture finance deploys capital in collaboration with corporates who are end consumers of the technology being financed. This approach offers a degree of de-risking through 'demand validation'. Patrick Sieb, another CTP co-founder, notes, "We're seeing a wave of breakthrough climate tech - electrification, sustainable fuels, next-gen grids - gaining real traction."
The team at CTP, with a strong background in venture capital and tech investments, is well-placed to identify the next wave of technologies that will drive emissions reduction across key sectors. Ludovic Theau, chief investment officer at Australian Ethical, expresses confidence in the growth opportunity represented by the fund.
Malcolm Thorton, CEFC's head of growth capital, views the Australian climate tech space as vibrant. Ian Learmonth, CEFC's chief executive, supports the CTP model and the fund, stating, "CEFC's Learmonth is confident that the team at CTP will deliver both environmental and commercial outcomes."
In summary, institutional interest in early-stage climate tech investments in Australia is strong and growing, anchored by sizeable capital inflows, supportive government policies, increasing corporate demand, and technological advancements. The stable climate policy framework and significant infrastructure investment plans provide a compelling and durable investment environment, creating a "once-in-a-generation" opportunity for institutions to lead and scale innovation toward a net-zero future.
[1] Australian Financial Review, "Climate Tech Partners raises $30m for new fund," 15th April 2025. [2] Australian Broadcasting Corporation, "Australia's $30bn flood defence package: What it means for flood-prone communities," 20th April 2025. [3] RenewEconomy, "Australian climate tech sector ripe for innovation: report," 25th April 2025. [4] Clean Energy Council, "Climate tech investment in Australia remains strong despite global decline," 30th April 2025.
- The surge in institutional investment in the Australian climate tech sector is not only driven by capital commitments and supportive government policies but also by the growing demand from corporations for clean solutions, as demonstrated by the interest in flood mitigation technologies following Australia's repeated climate disasters and the $30 billion federal flood defense package.
- Recognizing the potential of the Australian climate tech sector, Climate Tech Partners' co-founder, Tom Kline, has emphasized that the Australian government's commitment to long-term climate goals sends a powerful signal to innovators and investors, fostering the development and investment in breakthrough technologies in fields like electrification, sustainable fuels, and next-generation grids.
