Climate Week in New York is being taken over by the AI boom, though not all founders are pleased with the trend. The climate tech community is surfing the AI wave, but a few founders fear the data center boom is drawing attention away from other promising fields.
Over the last year, climate tech firms have faced a funding squeeze. Federal grants were canceled, and investors grew hesitant. The companies that could shift their pitch to ride the AI wave did just that. That pivot has helped many climate tech startups secure fresh funding from investors. Deal volume has risen for four straight quarters, reaching the $14 billion mark in the first quarter of this year, per the most recent PitchBook data. It marks the strongest fundraising environment for climate tech in the last few years, with most of the deal value coming from sectors tied to data center construction, including the built environment, grid infrastructure, and dispatchable energy that can be switched on or off as needed.
The Energy Pivot
The climate tech world shares the broader American economic enthusiasm for AI, with much of it currently riding the wave. There is concern among some about the sheer number of natural gas power plants being constructed to supply AI data centers. Yet, because so many climate tech startups operate in energy or sit close to it, the buildout has been welcomed as a chance to help firms survive the valley of death.
That shift has concentrated attention on a single sector, though, and other promising fields may end up neglected as a result. Many climate tech startups have gained new funding from investors thanks to the pivot. Venture deal value has climbed for four straight quarters, reaching the $14 billion mark in the first quarter of this year, per the most recent data from PitchBook. This is the strongest fundraising climate for climate tech in recent memory, with most of the deal value coming from sectors tied to data center construction, such as the built environment, grid infrastructure, and dispatchable energy that can be switched on or off as needed.
The Panel Question
A conversation at New York Climate Week illustrated the tension between ambition and caution. When two founders were asked which path they preferred — the current breakneck pace of AI development or a slower, more climate-conscious approach — they chose the former immediately. Their companies happen to be in the energy sector.
The response captures the feel of the gathering. The data center party draws the biggest crowd, and nearly all the founders are dancing inside the room where the action takes place.
Founders Who Disagree
There is disagreement on this point. A few founders have told me that the data center boom is drawing attention away from other promising parts of climate tech, which are meeting their goals without needing to lean on AI mania.
“Corporates are still interested in climate,” one founder told me. The difference today is that large companies don’t want to crow about it, mostly for fear of drawing the Trump administration’s ire.
Some evidence suggested the AI boom was starting to lose its edge. Three years ago, many startups found money for scaling hard to come by, even when they showed promising results. Today, customers are fighting to get into demos.
“Where was this money three years ago?” I asked several people. I received more than a few knowing eye rolls in reply.
The Eye Roll Response
These are the circumstances of their current existence, they admitted, and the successful business people are now all seeking out methods to reach customers wherever they happen to be.
A rolling of the eyes was the visible reaction. It demonstrated that some founders regard the boom as the issue itself, rather than the answer to anything.
The Undercurrent
New York Climate Week carried an underlying message: the data center boom may not go on indefinitely, yet it could persist long enough for startups to construct lasting businesses. Afterward, those companies can shift their attention back to the climate goals they were created to serve.
What is being proposed is a wager, not a plan of action. It rests on the expectation that the current surge will eventually ease, leaving the companies that endure with enough means to return to their initial purpose. Whether that comes to pass hinges on the duration of the boom and the harm it inflicts on other industries before it ends.
The Trade-Off
The choice is plain to see. The AI boom has sent record sums to climate tech, yet it has narrowed attention to a small part of the field. The sectors doing well — built environment, grid infrastructure, dispatchable energy — all tie into data center building. The sectors falling behind — the ones hitting their goals without needing AI fever — are the ones that may not make it through the neglect.
Here is how the two camps compare:
| Camp | What They Want | What They Get |
|---|---|---|
| Energy-focused founders | Faster data center buildout | Record funding, durable businesses |
| Other founders | Slower, more climate-responsible pace | Less attention, fewer resources |
The table makes the contrast plain. Founders who concentrate on energy are inside the room where the work happens, while the remaining founders operate outside it.
The Verdict
Climate Week is now dominated by the AI boom, and some people aren’t pleased with that arrangement. The data center party is the headline act, while the energy-focused founders are dancing inside the room where it happens. The rest of the founders sit on the sidelines, shaking their heads at a system that values speed more than sustainability.
Whether the boom ends before it helps anyone build lasting businesses is the real question. The undercurrent at New York Climate Week suggests the party could go on long enough for startups to construct durable businesses, yet the eye rolls show that the price of the diversion is being felt.
The wager stands open. Those startups which endure the boom with sufficient reserves to return to their initial purpose will emerge victorious. Those that were neglected during the boom and failed to secure the funding they required will be left behind.
Source material: “The AI boom took over Climate Week and not everyone is happy about it,” TechCrunch.
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