In our last blog post, we dove into the Digital Technology sector; if you have not had a chance to read that, please take a minute to do so here. This week will be dedicated to a competitor for the top spot, energy & sustainability. The deep dive will be done by giving a brief overview of the sector supported by market data and a discussion of some of the booming sub-verticals. 

Definition of Energy & Sustainability

The energy & sustainability sector encompasses a broad spectrum of innovative solutions, ranging from clean energy generation methods, like hydrogen, geothermal, nuclear fission, or oceanic methods, to energy management software for enterprises and decarbonisation technologies. 

Innovations of this category further span into emerging sectors like waste management, long-duration energy storage, and circular industries and economies. Together, these technologies and practices are designed to reduce carbon footprints, conserve natural resources, and promote long-term ecological balance, contributing to the transition toward a low-carbon and sustainable economy.

Energy & Sustainability 2024 Performance 

Energy & sustainability is one of the most notable deep tech sectors when it comes to dominating the news cycle and being in the spotlight. When compared to 2023 figures, 2024 was relatively similar, with all quarters seeing slightly higher deal volume but a slight decrease in overall funding amount; this seeming contradiction is explained by fewer mega deals and overall a lower median deal value. However, 2024 was still no stranger to fundraising mega deals like Vistra Energy’s $5.9 billion acquisition of Energy HBR and nine other m&a deals being completed in the 10-figure range; another seven fell into the $500m - $1bn category.

Beyond these outliers, all funding stages saw strong activity. In 2024, 752 venture and m&a deals were recorded, accounting for $13bn worth of investment and 8300 investors. When breaking down deal activity by stage, 17%% were seed rounds, 16% were early-stage VC, 21% were late-stage VC, and the rest were classified as m&a, grants, refinancing, or other. The outlier adjusted average deal size, was $1.7m, this average deal size in tandem with the mega deals recorded, signal strong activity at all stages of the funding pipeline.

2025 Outlook

Some growing segments based on increased investor sentiment/activity in the second half of 2025 include geothermal power, fusion energy, long-duration energy storage, and next-gen nuclear fission. These spaces have reported H1 metrics higher than last year in deal volume, total capital invested, and average age of companies, proving market validation and strengthening the later-stage pipelines.

Source: Pitchbook

Conclusion

The energy and sustainability sector remains a cornerstone of the deep tech landscape and a reflection of the zeitgeist of modern society. As we monitor these evolving sub-verticals, it’s clear that energy and sustainability will continue to drive market momentum and shape the future of deep tech.

*All data used in this report is sourced from Pitchbook. Interested in our methodology? We will soon publish our State of Deep Tech in Europe 2024 Report which dives deeper into each section and outlines how we conducted our research.