Transport emissions are a big part of the climate challenge, for example contributing 27% to US greenhouse gas emissions in 2020, according to the US EPA. Industry Report Partner Blair Pritchard, Partner at Virescent Ventures, talks through four key takeaways the cleantech venture capital manager sees in the next few years:
- Ebikes are a much bigger deal than EVs right now.
Worldwide, ebikes are outselling EVs by a multiple of 4 or 5 to 1 and they displace short, inefficient trips that would involve a lot of wasted time in traffic and parking if done in a car or van. An ebike can deliver parcels 60% faster than a van with 90% less emissions. Between 2020 and 2025, ebikes will deliver more emissions reductions than electric cars.
- We can’t solve climate change without EVs as well.
Most adult Australians (and Americans) currently own a car, and many use it for their daily commute or school run. For many of these people, it’s simply not practical to live without a car. Even if we were to eventually emulate the city design of countries with impeccable cycling credentials such as The Netherlands or Japan, car ownership would still be well above 50% (most households in Netherlands and Japan still own cars, they just don’t use them as often). Therefore, we need EVs to get to net zero.
- Urban form matters
A surprising amount of bureaucratic red tape is required to support our current emissions intensive cityscape. This extends from zoning, to heritage classifications, to parking minimums, to transit station design rules. Startups can help local government by modelling and envisioning a world of faster, healthier transport.
- Air travel is hard
Air transport is responsible for about two percent of global emissions, but it casts an outsized shadow in climate debates. I expect we will see zero emissions aircraft making short commercial flights around the middle of this decade. Long distance aviation will need a lot of help from deep tech startups, and a few major breakthroughs, before it becomes low carbon.
What we’re doing
At Virescent, we see cities and mobility as one of our four main focus areas (the others being clean energy, food, and industry). In our first fund, we’ve invested in fast growing mobility companies such as Zoomo (ebike logistics), Jetcharge (EV recharging) and Omnitanker (heavy land transport). In our second fund, which we’ve recently launched, we expect mobility to be an even greater focus in the portfolio as this sector heats up.