The End of Innocence: Rethinking Climate Investing in a Geopolitical Age

Decarbonization was once framed as a coordination problem.

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Decarbonization was once framed as a coordination problem. Get the incentives right, align the regulations, let the technology mature, and the market would do the rest. That story made sense for a while… until it didn’t.

Across the venture ecosystem, something has quietly shifted. Many investors have started questioning whether “climate tech” still means anything useful. Others have migrated toward adjacent framings such as resilience, adaptation, or biodiversity,without quite explaining why. A few have dropped the label altogether and moved on without looking back. That’s for sure: something underneath has moved. But what exactly?

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Several forces have converged at once: political backlash against ESG, a war in Europe that rewrote the rules of energy dependency overnight (and now, a war in the Middle East which seems bound to further deepen the issue), a deepening rivalry between major powers that has turned supply chains into strategic liabilities. Meanwhile, capital has drifted toward AI, cybersecurity, and defense-adjacent technologies, sectors that feel more suited to a world growing less stable by the quarter. The cooperative assumptions of the 2010s look, in retrospect, like a historical anomaly, a window that briefly opened and has since closed.

The truth is endlessly debating about terminology is a distraction. The real question is whether the frameworks we built during that window still work now that it’s shut.

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The physics don’t care

Climate change hasn’t changed. That’s worth saying plainly, because a lot of the noise around “ESG backlash” and capital rotation comes with an implicit suggestion that climate was always more hype than substance, another NFT cycle that ran its course. Nobody seriously believes the atmosphere has changed its mind, but the posture is convenient, and convenience has a way of doing the work that honesty won’t.

Public concern has proven more durable than expected too, particularly in Europe, where anxiety about climate sits alongside anxiety about energy prices and geopolitical instability rather than displacing it.

What has ended is something more specific: the belief that the transition would unfold within a stable, broadly cooperative international system. For a period, that belief seemed reasonable. Multilateral frameworks were holding, technological costs were falling faster than projected, and there was a plausible story in which economic incentives, regulatory coordination, and gradual industrial transformation aligned well enough to get the job done without major disruption.

And indeed, that story has aged badly.

The Geopolitical Shift

Europe’s situation makes this concrete. Decades of industrial offshoring left the continent dependent on external suppliers for technologies, components, and raw materials it once produced itself, a dependency that was legible on spreadsheets and invisible everywhere else until it wasn’t. When energy markets became arenas of strategic competition, the vulnerabilities that had been hiding in plain sight became impossible to ignore.

The logic of the transition has shifted accordingly. This is precisely the terrain that Pierre Charbonnier has been mapping from a philosophical angle. In Affluence and Freedom (Polity, 2021), he argues that the political categories of modernity were built on an implicit assumption of unlimited resource access — and that climate change explodes that assumption in ways our existing frameworks are not equipped to handle. In a subsequent essay for e-flux, For an Ecological Realpolitik, he goes further: the transition will not unfold as a cooperative problem-solving exercise, but as a geopolitical contest in which ecological ambitions and power consolidation become increasingly entangled. European ecology, he argues, needs to shed its “consensual, pacifying” habits and engage with that reality directly.

Energy autonomy now matters not just because it reduces emissions, but because it reduces leverage, the ability of external actors to use dependency as pressure. Grid infrastructure, digital networks, manufacturing capacity: these are no longer neutral utilities to be optimized for cost, and governments that have drawn the obvious conclusions from recent events are treating them accordingly.

This doesn’t displace the environmental argument. It sits alongside it, and in many political contexts it now carries more weight, which is either an opportunity or a warning depending on how you read it.

A Framework Running Out of Road

If “climate tech” is now being questioned, it is in part because it was never a standalone category. It emerged within a broader language of impact.

That language gave a generation of investors a somewhat generic yet workable compass, allowing capital to pursue financial returns and environmental benefit simultaneously within a framework legible to LPs, regulators, and founders alike. It was well-suited to its moment: stable regulation, open markets, and a broadly shared assumption that reducing externalities was the central task.

But at this stage, we can all agree: that moment is passing.

Consider cybersecurity, or the rebuilding of industrial capacity in critical sectors, or technologies designed to harden energy infrastructure against disruption (physical or digital). These investments matter enormously for the resilience of societies navigating the transition and sit awkwardly, at best, within traditional impact categories.

The framework was built around a specific logic: identify the externality, reduce it, measure the reduction. That logic remains necessary, but the emerging landscape forces a different set of questions, not just what harm does this avoid, but what capability does this build, and for whom, and under what conditions. The shift from externalities to capabilities is subtle but consequential, changing both what counts as a climate investment and the kind of analysis required to make one well.

The End of Magical Thinking

Energy systems evolve slowly — a point that Vaclav Smil has been making, with considerable patience, for the better part of three decades. In Energy and Civilization and the successive editions of Energy Transitions, he documents what most climate narratives prefer to skip: the sheer material weight of these shifts, the infrastructure they require, the volumes of critical minerals (copper, lithium, rare earths) they consume, the investment cycles measured in generations rather than quarters. His argument is not that the transition is impossible, but that it is slow by nature, and that pretending otherwise has costs.

Those costs are becoming visible: grid expansion bottlenecked by permitting and materials, offshore wind economics upended by inflation and interest rates, critical mineral dependencies that turned out to look uncomfortably like the fossil fuel dependencies they were meant to replace. The material world pushes back.

For several years, the narrative around climate action managed to hold urgency and optimism in a productive if uncomfortable tension. Ambitious timelines were set, progress was celebrated, and the harder questions about material complexity were quietly deferred — there was a political logic to this, since the energy transition needed believers as much as it needed engineers. But the balance has tipped. The people doing the actual work have run into enough friction to stop pretending that ambition and physics operate on the same timeline, and the language of the transition is shifting accordingly: less oriented toward mobilization, more toward execution, less rhetorical and more technical. Adaptation, long treated as a concession to pessimism, is increasingly part of the same conversation as mitigation.

Toward a More Demanding Framework

If the environment surrounding the transition has changed, investment frameworks will have to change with it. The considerations that mattered in the previous decade (emissions reductions, measurable impact, regulatory alignment) remain necessary, but they’re no longer sufficient.

What the current moment demands is a second layer of analysis, one that asks harder questions about the physical, strategic, and political conditions under which an investment actually holds up. Four criteria are becoming increasingly difficult to ignore:

Material Realism — Is the trajectory physically credible? Every investment thesis rests on assumptions about how fast things can change, and those assumptions need to be stress-tested against infrastructure timelines, industrial capacity, and resource constraints rather than policy targets or market projections alone. Copper, lithium, grid buildout, manufacturing depth: the material dimension of the transition is where most optimistic narratives quietly break down. A technology may work in isolation; the real test lies in whether the system around it can scale under real-world conditions — which is exactly what makes Ever Dye interesting. By rethinking the dyeing process itself, the company tackles one of the most energy- and resource-intensive steps of the textile value chain, targeting the physical constraints of the system rather than chasing marginal improvements, with the ambition to reshape the industry at scale.

Strategic Autonomy — Does it reduce critical dependencies? Dependency is a form of vulnerability. Investments that reinforce Europe’s reliance on external suppliers for critical components, raw materials, or digital infrastructure carry a strategic cost that does not appear in standard financial models. Conversely, reducing exposure to external leverage — by diversifying sources, securing key inputs, or regaining control over critical layers of the value chain — strengthens Europe’s ability to act under pressure. Orus Energy is a case in point: by turning consumption flexibility into a resource, it helps stabilize the grid during peak demand and reduces exposure to external energy constraints, contributing to a more resilient and autonomous energy system.

Capacity Building — Does it reinforce Europe’s productive base? Beyond the question of dependency lies another one: whether Europe retains the ability to build, operate, and improve its own systems. Industrial depth depends on accumulated capabilities — engineering know-how, manufacturing expertise, operational experience — and investments that rebuild these capabilities, in production, in infrastructure, in systems integration, contribute to long-term resilience. The key question is whether an investment leaves behind durable know-how and productive capacity, or simply installs assets without strengthening the underlying system. Diamfab is a clear illustration: by advancing semiconductor manufacturing capabilities in Europe, it helps rebuild critical know-how and industrial depth in a strategically sensitive domain, reinforcing the ability to design, produce, and improve key components locally over time.

Democratic Compatibility — Is it aligned with open societies and the rule of law? The transition will shape the infrastructure of European societies for decades. Technologies that optimize for efficiency or speed while concentrating control, eroding transparency, or creating new forms of surveillance introduce risks that sit outside most standard due diligence frameworks. Alignment with democratic institutions isn’t a soft constraint to be balanced against returns. It’s a hard boundary, one that becomes more relevant as the strategic stakes of energy and digital infrastructure continue to rise. Qomon makes this concrete: by equipping organizations with tools to structure engagement and mobilize communities, it supports forms of collective action that remain compatible with democratic institutions, helping ensure that the systems shaping the transition strengthen participation and accountability rather than undermine them.

Taken together, these four criteria don’t replace the impact framework. They sit on top of it, adding a layer of analysis suited to a world that is more constrained, more contested, and considerably less forgiving than the one in which climate investing first took shape.

Same Destination, New Environment

The climate constraint remains exactly where it was, and what has changed is everything surrounding it.

We now know that the transition will not follow a clean trajectory. It will develop under economic pressure, material constraints, and persistent geopolitical tension, in a world where the actors involved have diverging interests and limited patience for coordination. For investors, the level of difficulty rises accordingly: climate investing increasingly demands technical understanding of industrial systems, supply chains, infrastructure, and physical limits, all of which play a far greater role than the narratives of the previous decade suggested.

Capital allocation will depend less on symbolic alignment and more on the ability to identify durable capabilities. In other words: the capacity to distinguish structural transformation from fashionable framing.

For Europe in particular, none of this is optional. More than ever, decarbonization remains inseparable from long-term prosperity, autonomy, and political stability.

Three questions for… Florent Barre, CEO and Co-founder of Qomon.

If the transition is set to unfold in a more conflictual environment, then the question becomes how those on the ground adapt to it. How do founders rethink their role and their action when consensus gives way to contestation?Florent Barre is co-founder and CEO of Qomon, a French-American platform that helps nonprofits, campaigns, and advocacy organizations structure and mobilize their communities. Active in more than 70 countries, Qomon provides digital tools designed to support collective action at scale, combining technology, grassroots engagement, and data.

Working at the intersection of organizing, technology, and political engagement, Florent has a front-row view of how movements and organizations adapt in increasingly tense and fragmented environments. He also writes the excellent Substack newsletter Go with The Flow, which explores how organizations operate beyond the technological layer — with its latest edition focusing on the role of conflict in political dynamics.

You’ve spent years building tools to organize movements and campaigns. From your vantage point, how does the current moment feel? Are we entering a more conflictual phase in how societies deal with major transitions?

We’re in a moment where conflict and violence are more visible than in the previous era. There’s no point in denying it: conflict is now out in the open.

But what has truly changed, I think, is how we argue. To put it bluntly: fewer ideas, more emotion. And when ideas fade, moral absolutism takes over, leading to hyperpolarization.

Make no mistake: conflict has always been there. We just chose not to see it. And honestly, visible conflict can be a good thing when it comes to sparking a transition, because there is no such thing as a smooth transition. From my point of view, that was always a comfortable lie.

There’s a growing sense that the transition will be less consensual than many expected. But perhaps conflict is not the problem in itself, as you wrote yourself in your latest piece. From your perspective, what makes conflict productive — or destructive — in a democratic context?

Conflict can be productive when it is clear and legible, when it helps draw lines, clarify choices for society, and give citizens a reason to engage and mobilize.

It becomes destructive when it slips into moral absolutism, emotional escalation, or the logic of existential enemies rather than political adversaries.

That’s a big part of what we see on social media today: a lot of heat, but not much substance. I believe democratic conflict should make choices clearer, not make disagreement impossible.

And when you look at companies that have transformed societies and their industries, you often find strong, structured conflict at their core — whether visible or not, whether explicitly framed or not, whether they embrace a “missionary” posture or not. But never through moral warfare.

Many founders who built their companies around the idea of impact are now facing a more hostile environment. How do you feel about that yourself? What changes in how they need to think, build, and act today?

Let’s be honest: I never believed you could build a company around an idea as vague as “impact.” You build it around a real problem — one that happens to matter to society.

Impact is more about how you operate: the choices you make every day, the tactics you use. It becomes more robust because solving a real problem is a framework that holds under pressure.

For me, the hostile environment is mostly a layer of commentary. What has changed, more fundamentally, is the time horizon.

Entrepreneurs now have to operate on a longer clock. Long-term transformation used to be managed by politics. Today, whether we like it or not, those who are in a position to drive these transitions — and who have the time to do it — are entrepreneurs, together with society.

So let’s not become commentators. Let’s remain entrepreneurs, stay focused, keep building, and let the noise pass.

A closer look at one of our portfolio companies currently raising — building real-world impact at the intersection of mobility, data, and energy transition.

→ Nelson Mobility — using data science and AI to simplify the electrification of corporate vehicle fleets. Their real-time simulation engine aggregates fleet data, charging infrastructure, regulations, and total cost of ownership to help companies like Veolia, EDF, JCDecaux, and Johnson & Johnson move from hesitation to decision. The ambition: putting 100,000 electric vehicles on the road by 2030 — because if companies don’t switch first, the general public never will.

🎙️ Listen to Alfred Richard, CEO & co-founder, on the Humans of Asterion podcast — from the French army to electrifying corporate fleets.

This round is nearly closed. We’re holding the last few tickets for operators and investors with deep expertise in the sector.

Contact: antonin@asterionventures.com

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