For decades, Israel has been a global case study in innovation born of necessity. 

Surrounded by threats and short on resources, the country built cutting-edge missile defense systems, turned deserts into agricultural hubs, and developed a thriving tech sector against the odds. 

As we׳ve learned from PLANETech’s 2024 – 2025 Climate Tech Status Report, climate technology is not a major part of this sector.

In the new era of deglobalization, where resilience is the new currency; Israel cannot rely on its past alone. It must evolve, especially now when the opportunity is so massive and the global economy is changing course. 

As the United States turns inward and global supply chains fragment, Europe is emerging on top, and not by accident; it has been preparing for years. 

It’s time for Israel to follow suit.

More than defense tech

The global system that once optimized for efficiency and free trade is now optimizing for resiliency. 

Covid-19, the Ukraine war, and the energy crisis have all made it clear: No country can afford to be wholly dependent on others for critical systems. 

While Israel excels in cybersecurity and intelligence, resilience today goes beyond these industries. It includes the security of energy, critical industries, and water.

And that’s where the opportunity lies. Climate tech is no longer just about saving the planet, but a strategic competitive advantage. 

From energy storage to smart grid; from mineral recycling to the creation of sustainable materials in the lab, climate tech defines the next era of industrial innovation. Europe sees that clearly. And it’s acting.

Europe as a playbook 

Over the past decade, Europe was hit by crisis after crisis: Trump’s protectionist policies, Covid’s supply shocks, and Russia’s weaponization of energy. These weren’t just setbacks; they were lessons for the direction the world is heading in the 21st century. 

Today, Europe is pouring hundreds of billions into defense, energy transition and reindustrialization. Germany, France and the EU are offering incentives for efficient technologies, reshoring strategic industries, and building regional alliances for supply-chain resilience.

This strategy is working. Global capital, in search of stability, is flowing into European projects in the fields of energy, climate and industry. Europe isn’t chasing headlines, it’s building assets. 

And in climate tech, this is particularly evident. According to the latest Net Zero Insights report, even before the tariff shocks, Europe surpassed America in the number of energy, industrial and climate-tech companies: 22,197 compared to just 14,332 in the United States.

In 2024, Europe led in climate tech funding with $38.88 billion, compared to only $33.5 billion in the US. Most of these investments were made through debt and non-dilutive financing, which attracts companies to Europe. Against the backdrop of the Trump administration’s policy shifts, this trend is expected to accelerate. 

This also creates fertile ground for corporate capital seeking to invest in industrial innovation that offers competitive business advantage, hedges supply-chain risk, and ensures compliance with Net Zero regulations.

Israel can lead, but must act faster

Israel has all the components needed to succeed in climate innovation: talent in software, hardware and artificial intelligence; leading academic institutions like the Technion and Weizmann Institute that develop breakthrough technologies; global companies like Enlight and Ormat that bring market access and expertise; technological capabilities rooted in the IDF; and most importantly, experienced, world-class entrepreneurs.

As noted in the PLANETech report, Israel’s climate tech ecosystem includes a few hundred companies, a small number of dedicated funds, and grants from the Israel Innovation Authority and European partners. 

Despite growing interest in climate investments, national policy and public capital are still lagging. Climate tech is still perceived as a “green niche,” rather than as the core engine of a resilient, future-proof economy.

That’s a strategic mistake.

Make tech-driven energy resilience a national policy

If Israel wants to preserve its technological edge, it must treat climate resilience the same way it treated cybersecurity: as a national priority. 

That requires prioritizing energy independence, investing in smart grids, scaling storage solutions, and deploying technologies that reduce industrial energy use and detect climate-driven extreme events that could threaten national resilience. 

The Independence Day wildfires in Israel and the power grid failure in Spain and Portugal last week are just two reminders.

This kind of resilience requires not only international collaboration to build new supply chains, but also broad domestic support for startups; not just via grants, but also through regulatory streamlining, regulatory sandboxes for pilot programs, and proactive government procurement. 

Europe did this in response to a crisis. Israel has the chance to do it by choice.

Don’t watch from the sidelines

The world is entering a new era of strategic competition. Countries that build resilient, self-sufficient and energy-efficient economies will lead 21st-century growth.

Israel cannot afford to fall behind. The same entrepreneurial spirit that brought Iron Dome and drip irrigation to the world must now be channeled into smart grids, energy storage, efficient raw material production and clean industry.

Climate technologies are not just the right policy, but the right strategy. If Europe could turn crisis into opportunity, Israel can too. The time is now.

Guy Cherni is the cofounder and managing partner of Climate First, a team of investors and entrepreneurs committed to addressing humanity’s most significant challenges.