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Surge in Investments in China's Climate Tech Amid Low-Carbon Shift

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Aqsa Younas Rana
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Surge in Investments in China's Climate Tech Amid Low-Carbon Shift

China, the world's largest emitter of greenhouse gases, is seeing a significant rise in investments in climate technology companies. These firms are believed to be the backbone of the country's shift towards a low-carbon economy, a pivot that is crucial to fuel its future growth. Data from Deloitte's GreenSpace Tech unit and market data provider Pitchbook reveal that by the end of July, funding for these companies in China represented 32.5 percent of the worldwide total. This is a stark increase from the 15.1 percent share in 2020.

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(Read Also: China and Vietnam Seek to Enhance Strategic Relations)

Impressive Figures and Future Projections

Mohit Grover, Deloitte China Hong Kong's climate and sustainability leader, anticipates this trend to continue. The backing for this prediction comes from the significant interest shown by financial institutions in investing in climate technologies. Since the turn of the century, approximately 2,400 climate tech companies have been established in China, leading to about 9,000 funding deals and a total investment of US$148 billion.

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Where Are The Investments Going?

The primary beneficiaries of these investments are the energy and transport sectors, with short-duration energy storage leading at 41.7 percent. However, sectors with substantial greenhouse gas emissions, such as agriculture and heavy industries, are earmarked for further development and investment.

(Read Also: Influenza Identified as Primary Cause of Respiratory Diseases Surge in China)

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Hong Kong's Embrace of Climate Tech

Meanwhile, Hong Kong is also prioritizing climate tech. This focus is expected to forge vital connections to international technologies and funding, elements necessary for a successful transition to a low-carbon economy.

Despite China's impressive strides in renewables and its leading role in climate tech investments, it faces a significant challenge: its ongoing reliance on coal. The country is simultaneously heralded as a renewable energy leader and criticized for its expanding coal fleet, a dichotomy that highlights the complexity of China's energy landscape. As the country grapples with this paradox, the emphasis on green energy storage solutions emerges as a key factor in maximizing the potential of renewables, and ultimately, in reducing its reliance on coal.

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