Is 2025 the Year 'Nature' Replaces 'Climate'?
by Amalia Helen, Nature Tech Collective
Climate change discussions often focus narrowly on carbon emissions, overshadowing other critical planetary health challenges like biodiversity loss. This "carbon tunnel vision" can lead to unintended consequences, such as afforestation projects reducing species richness or renewable energy projects disrupting ecosystems. For instance, dams for energy can alter freshwater flows, harming blue carbon habitats like mangroves that store carbon.
To solve carbon tunnel vision, we need better ways to understand, assess and plan for impacts on nature. Traditional methods used to monitor biodiversity like field surveys have been manual, imprecise, and not scalable. Luckily, technological innovation in this space is exploding. Emerging technologies like D-MRV (Digital Monitoring, Reporting, and Verification) leverage sensors, satellites, LiDAR, and eDNA testing for accurate ecosystem assessments.
Solutions are also rapidly advancing beyond traditional MRV. In fact, the nature tech sector is growing so fast, that there’s a pressing need to better map and define the market. (We’re actively working to address this challenge at the Nature Tech Collective through our inaugural Nature Tech Taxonomy Framework project and sector maps.)
Meanwhile, as nature tech gains momentum, headwinds are combining to test decarbonization goals and climate tech investments in the years ahead. Could the rise of nature tech be coinciding with a contraction in the climate tech sector?
Climate Tech at a Crossroads, Nature Tech on the Rise
While the spotlight on decarbonization remains critical, the climate tech sector is entering a period of uncertainty. Rising interest rates, inflation, and geopolitical tensions have already constrained private equity and venture capital funding for climate tech.
In 2024, investment in climate tech slowed, revealing the sector’s potential sensitivity to macroeconomic shifts:
Until now, investment in US climate tech startups held steady, helped in large part by the U.S. Inflation Reduction Act's tax credits. However, as we all know, 2025 may present a shift in US climate policy. There could be policy rollbacks, such as a U.S. withdrawal from the Paris Agreement and changes to the Inflation Reduction Act, raising further questions about the sector's near-term predictability and growth trajectory.
Meanwhile, the nature tech sector is leveraging advancements in data collection, AI, regulation and financial innovation to meet surging demand for biodiversity insights. Unlike climate tech, which often hinges on volatile energy markets or contentious policy frameworks, nature tech is thriving on opportunities created by evolving sustainability mandates and technological breakthroughs.
In 2023, venture capital nature tech investments rose by 18% and forward-looking growth projections are positive:
The combination of biodiversity data and AI appears particularly attractive to investors. To spotlight one example, as of September 2024, NatureMetrics has raised $30.7 million to scale its biodiversity monitoring technology and eDNA-based solutions, citing rising global demands for nature data across ESG sectors.
Indeed, we’ve seen corporate demand in this space continue to accelerate through 2024 as companies learn more about new regulations and policy initiatives blowing in their direction. The EU’s Corporate Sustainability Reporting Directive (CSRD), as well as voluntary initiatives, such as the Taskforce for Nature-related Financial Disclosures (TNFD) have led to a dramatic rise in companies exploring their nature impacts, dependencies, risks and opportunities, such as regulatory changes, shifting market dynamics, or liability risks:
Companies like RWE, are beginning to assess nature-related risks and opportunities alongside their climate strategies, considering them to be symbiotic. To understand how their business affects natural ecosystems, RWE deploys monitoring technology, including bird detection devices that track how birds fly through the company's windmills. As part of their research and development, the energy giant uses artificial structures with camera traps, drones, sensors, and AI to analyse data. For measuring and reporting, RWE uses nature tech providers, such as the aforementioned NatureMetrics, and eDNA, to help manage their impacts and dependencies on biodiversity at scale.
AXA XL, a global provider of insurance and reinsurance, has also made nature and biodiversity a key pillar in its sustainability strategy. The company is working with Land Life, a nature restoration company that uses advanced bioacoustics technology and satellite imagery to monitor and track biodiversity and habitat recovery.
Nature fintech is another emerging area. Innovative financial tools are sprouting, and a healthy ecosystem exists today of financial technology solutions harnessing AI, blockchain, remote sensing, and many other bleeding edge technologies to unlock the potential of nature-based financial innovation, fund conservation projects, resolve reporting requirements, and mitigate transition risks. These solutions increase financial transparency and inclusion, ensuring an equitable assessment of risks and opportunities in nature.
From carbon tunnel vision to collaborative, planet-first thinking
In the short term, nature-focused policy and investment may evoke less political controversy than decarbonization initiatives because they are usually seen as additive and restorative.
Still, there is a lot of work needed to accelerate nature tech innovation further. The market is growing, but not as fast as it should be. Levels of spending on nature conservation and restoration are still drastically short of what’s needed, and looking to governments won’t fill the nature finance gap alone.
More than half of nature investments are valued at less than US $10 million, which is too small for many institutional advisors. As climate tech growth slows, perhaps one solution is to proactively combine more initiatives and projects for larger investment opportunities - including across the traditionally distinct worlds of ‘climate’ and ‘nature tech’. The Bezos Earth fund models this approach in their simultaneous call for solutions that focus on sustainable proteins, power grid optimization, or biodiversity conservation.
Here at the Nature Tech Collective, we support the idea that nature tech can help catalyze new collaborations between stakeholders across climate and conservation sectors. We believe such an integrated approach is not only logical but necessary, as efforts to preserve biodiversity typically yield climate benefits too.
As we step boldly into 2025, nature tech is poised to help drive a paradigm shift, not by replacing climate tech, but by complementing it in ways that are essential for planetary resilience. This is the year to move beyond tunnel vision and embrace a more holistic framework for addressing the intertwined crises of our time.
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Great info. Of course, it all starts by protecting what natural ecosystems we have left, including carbon-rich treeless ecosystems https://predirections.substack.com/p/dont-forget-non-forest-carbon-rich
Thanks for this, and I leave this comment with the greatest respect for your work...but as an educator, I worry that the more we say "nature," the more ingrained separation becomes for those who hear it, especially young kids. We are nature. It's not something separate. If we don't see ourselves as deeply entangled with all living things on the planet, we'll never fully repair the broken relationships that have brought us to the brink. Some might say it's semantics, but the words matter. (In the schools I work with, one of the first things we do is make sure we have a coherent shared definition around "learning" and "success.") Anyway, just an observation that I would love to hear what others think about. With gratitude