Venture capital investment in climate technology grew significantly in the first half of 2026, rising by more than 50% over the same period in the prior year to levels not seen in several years, driven largely by an increasing focus on technologies that can address the rapidly growing demand for energy by data centers, according to a new report by market intelligence company Currence (formerly Sightline Climate).

The report also indicated a record quarter for cleantech IPOs and acquisitions, with large-scale deals for companies developing low-carbon firm power sources such as geothermal, with Fervo’s $1.9 billion IPO, and advanced nuclear, with X-Energy’s $1 billion IPO.

According to Currence, VC climate tech investment reached $26.1 billion in H1 2026, up by 55% over H1 2025, marking the strongest fundraising H1 for the sector since 2022.

The report indicated that data center-related technologies accounted for a significant portion of the increase, with the sector making up 34% of all climate funding in H1, compared to only 3% in the prior year. Currence noted that the increase comes as clean firm generation can be a distinct advantage in the data center “speed-to-power race,” as gas turbine wait times become stretched, while several low carbon solutions can more rapidly deliver power.

In the report, Currence said:

“The AI compute race is driving a VC boom even larger than the heady days of 2021-2022. Startups are competing against incumbents with a faster route to power.”

While total climate tech funding amounts grew, the report also found a significant increase in deal concentration, with the largest 10 deals accounting for more than 40% of all funding, and deal count actually falling by 25% in H1 over the prior year. The largest deals in the quarter include data center developers DayOne, which is aiming to reach 100% renewable energy by 2030, Nscale, which operates data centers in regions with a stable oversupply of renewable power, and SB Energy, which builds data centers paired with its own solar and storage.

The report also found a growing appetite for early-stage energy technologies, with advanced nuclear technology companies Inertia and Blue Energy raising $450 million and $380 million, respectively, in Series A rounds, with Currence noting “investors stepping up years before the technology will reach the grid.”

Notably, while fundraising activity focused largely on data center-related technologies, the report also noted a strong H1 for climate risk and adaptation startups, with climate management-related fundraising recording the best first half since 2022, led by deals such as earth observation companies’ ICEYE’s $521 million round, and Tomorrow.io’s $175 million. In the report, Currence noted that “as physical climate risk turns from forecast to lived reality, the tools to see and respond to it are drawing growth-stage money once reserved for mitigation. The bill that climate scientists predicted decades ago is coming due.”

The report also found a record H1 for climate tech exits, reaching 152 in the half, up 68% over the prior year, including approximately 135 acquisitions, which were dominated by energy-focused deals, and a 71% jump in IPOs, led by Fervo and X-Energy, which Currence said is “inspiring a second wave of companies to make the leap into public markets.”

Click here to access the report.