New technologies represent a very important part of the world’s efforts to reach net zero by 2050. But a lot of the climate tech initiatives are not quite ready, as the report states, including 25 to 30 percent from technologies that are demonstrated but not yet mature and another 10 to 15 percent from those still in R&D.
There are, still, reasons for optimism, researchers and startup founders doing the best they can to bring to market the solutions they are working on for decarbonizing. And, alongside their efforts, the interest of investors willing to commit their money is also peaking.
“Our estimates suggest that next-generation technologies could attract $1.5 trillion to $2 trillion of capital investment per year by 2025”, states the report from McKinsey, adding the fact that these new green businesses could help reduce 40% of greenhouse gases emissions by 2050.
They’ve also compiled a list of technologies that could spur new green business ideas and could attract investments in the following years.
Green business ideas - Electrification
Electric vehicle batteries, battery control software, efficient building systems, industrial electrification.
According to the report by McKinsey, electrifying transportation requires cutting the cost of batteries, which can account for as much as half the cost of an EV. To boost energy density and cut costs, battery chemistry will have to improve. Companies are working on anodes with high silicon content, which represent the next frontier. For example, Panasonic is investing 700 million dollars in a new factory in order to produce a new type of batteries created especially for Tesla.
At the same time, we can talk about electrification and green solutions when it comes to building efficient building systems.
Buildings account for about 7 percent of global CO2 emissions. Cutting those emissions would require making buildings more energy efficient with technologies such as LED lighting, high-efficiency HVAC, and energy controls, according to the latest report from McKinsey.
“Buildings, like vehicles, have to go electric. Using heat pumps to keep buildings warm, instead of traditional boilers and furnaces, could cut global CO2 emissions by 3 gigatons per year if implemented worldwide”.
Annual investment by 2025 could be around 700 and 1,000 billion dollars.
Zero-emissions farm equipment, meat alternatives, methane inhibitors, bioengineering.
“Agriculture accounts for about 20 percent of global GHG emissions. The most significant GHG from agriculture is methane, which has many times the warming power of CO2. Reducing methane emissions from agriculture (and other sources) would require major changes to how society farms, eats, manages supplies and waste, and stewards cropland and forests”, is stated in the report.
Some green business ideas for the field of agriculture could bring to market zero emissions farm equipment, for example, or meat alternatives.
Also, according to the analysts at McKinsey, companies are developing feed supplements and substitutes that inhibit methane production by altering an animal’s digestive processes.
Annual investment by 2025 could be between 400 and 600 billion dollars.
You can find out more about the opportunities for green business ideas from the McKinsey report here.
We are talking here about solutions meant for long duration storage, advanced controls, software and communication, next generation nuclear, high efficiency materials – for example, solar cells made with perovskites, a special type of crystal, could outperform regular silicon solar cells, and cost less to make, also using graphene).
The potential for investments is between 200 and 250 billion dollars per year by 2025.
Green business ideas - Hydrogen
We’re talking here about low cost production, ammonia production, steel production, aviation fuel, road transport fuel.
Hydrogen could play a significant role in decarbonization. If hydrogen could be made for less than $2 per kilogram in the European Union or $1 per kilogram in parts of the United States by 2030, major end uses would become economically viable, according to the report from McKinsey.
Annual investment in the next 3 years could be between 100 and 150 billion dollars.
We are talking here about pre and post combustion technologies, CO2 enriched concrete (for example, Holcim, one of the most important building materials company, recently announced a partnership with ENI to transform CO2 from carbon capture into green cement).
The potential for investments is between 10 and 50 billion dollars per year by 2025.