MILE Advisory Releases Critical Data Report About Israel's Decarbonization Tech Ecosystem

 The first-of-its-kind analysis of the Israeli decarbonization ecosystem compares the supply of Israeli decarb-tech versus the demand outlined by the International Energy Agency and finds that because the ecosystem does not have a data-driven strategy for developing decarbonization technologies that directly address the global climate crisis, Israel will miss out on this trillion dollar market. 

NEW YORK, Jan. 24, 2024 /PRNewswire/ -- MILE Advisory, a strategic consultancy firm specializing in energy and climate innovation, today released a report titled "Israel's Decarbonization Tech Ecosystem Report - 2023", focusing on the global decarbonization market and where Israel is succeeding and failing in aligning with global decarbonization demands. The report, based on extensive qualitative and quantitative data and research, is the first-of-its-kind survey of Israel's decarbonization technology efforts within its broader climate-tech ecosystem. This evaluation provides insights to inform private sector practices and government policies, guide VC investment strategies, and to foster startups that tackle real-world, demand-oriented problems.

To analyze Israel's climate technology supply, the report relied on existing open source Israeli data, and for the first time included the International Energy Agency (IEA) clean energy technology database, which contains over five hundred technologies across the net-zero energy landscape highlighting the level of importance for net-zero emissions. Through meticulous and proprietary classifications from various sources and databases, MILE Advisory developed a curated list of Israeli technology startups operating in the decarbonization space. The list, available separately from the report, provides the first-of-its-kind categorization of Israeli startups that focus directly on decarbonization and those that are enabling decarbonization efforts.

The analysis reveals that while the climate ecosystem in Israel has been reported to boast upward of 800 startups, the data suggests that only 420 companies are developing potential decarbonization solutions, and of those, a mere 152 startups are directly addressing decarbonization needs, termed "Decarbonizationists" in the report. Sixty two percent (62%) of these 152 startups are predominantly active in energy transformation and transport sectors. The additional 268 companies, termed "Enablers", are qualified pursuant to the IEA's technology database to enhance decarbonization efforts or contribute to emission reduction. These Enablers offer digital software solutions, with around half focused on energy efficiency, efficient transportation, fuel savings, and electricity network analytics, maintenance, and management. Despite all of this activity, a noticeable gap exists between global demand and Israeli supply.

Key insights from the report include:

• Government Investment Disparity - Israel's level of government investment in research and development in the energy sector is five times lower - as a ratio of GDP - than other OECD countries. The average government investment in R&D for the energy sector as a ratio of GDP in OECD countries is around 0.02%, whereas in Israel, it stands at 0.004%
• Israel's Energy Supply Gap - There are 152 Israeli decarb-tech companies that are directly supplying 75 of the 500 (a mere 15%) clean energy technologies that the IEA has classified as in-demand. This is a clear indication of the need for data-driven decision making to build the foundation of a decarb-tech ecosystem.
• Data-Driven Investment Opportunities - Approximately 46% (of the 152 startups) are actively engaged in developing technologies that hold high and very-high importance in the context of achieving net-zero emissions by 2050.
• Scaling Up Israel's Decarbonization Startups - While there are numerous Israeli startups in the decarbonization space, Israel can only realize achievements at scale if it were to develop solutions in line with global demand and priorities. Support from public investment and foreign venture capital is critical to Israel's ability to participate in any meaningful way in the global climate economy.
• Unlocking Israel's Decarbonization Potential - In the short to medium-term, Israel can realize significant benefit from leveraging its traditional strengths in areas such as software, security and artificial intelligence and more, to enable decarbonizing technologies.

"Israel's lack of a climate strategy puts the country at risk of forfeiting opportunities to be a significant player in the drive towards global decarbonization," said Morielle Lotan, Founder of MILE Advisory and author of the report. "Ultimately, the private sector, investors and tech entrepreneurs are going to have to fill the void created by the lack of any strategic climate vision and budget allocation by the government. Entrepreneurs, investors, innovation hubs, and government-funded initiatives in Israel must recognize that the path to becoming leaders in the global fight against climate change requires the development of a comprehensive strategy hyper-focused on Israel's unique value proposition. This report serves as a blueprint to build a robust decarb-tech strategy that considers the demands of the entire global value chain and to develop and export, at scale, advanced decarbonization solutions."

To access the complete report, please click here.

About MILE Advisory

MILE Advisory is a strategic consultancy practice specializing in energy and climate innovation. Working with investors, startups and governments MILE offers clients hands-on expertise and walks beside decision-makers who are navigating the energy and climate landscape. MILE Advisory adds value by creating a collaborative ecosystem that unites investors, governments, academia, and tech startups. This fosters partnerships, investment opportunities, open innovation challenges, evidence-based research, and more. Leveraging its extensive knowledge and global network, MILE Advisory empowers clients to assume leadership positions in the ongoing energy transition and climate era, enabling them to make a lasting impact in these critical areas.

SOURCE MILE Advisory