Mapping the CleanTech sector

The UK CleanTech sector is bigger, messier, and more spread out than earlier studies suggested. The Data City’s CleanTech Real-Time Industrial Classification captures 2,537 companies across six verticals. The picture that comes out of it: rapid growth, funding concentrated in a few hands, and a small cohort of university spinouts punching far above their weight.

A sector of extremes

CleanTech is not a uniform industry. It spans 2,537 active UK companies with a combined turnover of £354.5bn, growing at an average of 10.0% per year. But beneath that headline figure lies a stark long tail: 1,156 micro companies (46%) sit alongside just 77 large enterprises. The median CleanTech company has 2 employees and a turnover of around £180,000. This is a sector being built from the ground up, one small company at a time.

Energy dominates the taxonomy: 1,454 companies (57%) work in energy production, management and storage. Water processing (321), adapted goods (311), and mining, fuels and biofuels (308) follow. Agriculture and environmental pro

The incorporation surge

CleanTech incorporations have accelerated sharply since 2015, peaking in 2021 when 227 new companies entered the sector, more than double the rate of a decade earlier. Even after a post-2021 dip, 2023 and 2024 remain well above historical averages.

Where CleanTech lives

CleanTech companies are spread across 358 local authorities, but cluster sharply in a handful of places. Westminster alone is home to 279 CleanTech companies, the highest count of any local authority. That reflects the concentration of energy consultancies, green finance firms, and corporate headquarters in central London. The City of London leads on employment, with over 8,500 CleanTech jobs.

But headcount and company count tell different stories. Edinburgh, Bristol, and Cambridge rank among the top locations by number of firms, while Aberdeen City and North Yorkshire appear when ranked by employees. That points to the energy and industrial heritage of those regions. Cambridge stands out for a different reason: it has one of the highest concentrations of STEM occupations in CleanTech, with over 56% of roles classified as STEM. That’s a signal of deep technical specialisation rather than corporate overhead.

Funding

Across 570 recorded funding rounds, CleanTech companies have raised over £20,748m. The sector received £3,231m in 2024 alone, the second-highest year on record after the 2020 peak, which was driven by large debt financing rounds. Grants remain important (125 grant rounds totalling £193m), but private equity, series rounds, and debt financing dominate at scale.

Specialist UK funds lead the investor list: Par Equity and IP Group each appear in 16 funding rounds, followed by Scottish Investment Bank, Crowdcube, and Parkwalk Advisors. University-linked investors, including Cambridge Enterprise and Low Carbon Innovation Fund, feature prominently. That fits with the academic origins of much CleanTech innovation.

Innovate UK has distributed £466m across the sector. That early-stage support often precedes private investment. For many micro and small CleanTech firms, public funding is the first external capital they receive.

The spinout advantage

The most striking finding is the disproportionate role university spinouts play. Just 37 companies, 1.5% of the sector, account for £603m of investment, roughly 14.0% of all CleanTech funding. The median spinout has a turnover of £2,431,305, more than 14× the median for non-spinout companies.

Leading spinouts include Nexeon (£244m raised), a battery materials company, and Nyobolt (£134m), developing ultra-fast charging technology. OxCCU, Econic Technologies, and Xampla show the range of spinout activity, from carbon-to-fuel conversion to biodegradable materials. NEXEON LIMITED alone has raised more than many verticals combined.

Spinouts are also more likely to receive Innovate UK support (86% vs 9% for non-spinouts) and private investment (57% vs 3%). They represent the pipeline of deep-tech CleanTech innovation: companies born in labs that are now scaling commercially.

What this means

Standard industrial classifications cannot capture CleanTech. There is no SIC code for “green hydrogen startup” or “carbon capture spinout.” RTICs exist because sectors like CleanTech need classification that keeps pace, reflecting what companies actually do now, not what they were registered as decades ago.

The data shows two CleanTech sectors running side by side: thousands of small, growing companies, and a handful of heavily funded deep-tech firms. London headquarters sit next to Scottish energy clusters. Grant-funded research sits next to billion-pound debt rounds. That matters for anyone trying to work out where UK net zero investment is actually going, from policymakers to investors.

Explore the CleanTech RTIC on The Industry Engine to dig deeper into individual companies, verticals, and local ecosystems.