Europe is failing to meet 'dirty air' targets. Is this an opportunity for impact companies?

Air quality in almost every nation globally falls short of medical recommendations, according to a new analysis, with just two European countries meeting the World Health Organisation's standards.

Estonia and Iceland were the only places in the region maintaining the World Health Organisation's (WHO) guidelines for fine harmful particles (called PM2.5) during the past year, based on research from Swiss air quality monitoring firm IQAir. Australia and New Zealand also met the targets, alongside several small island nations. Bosnia and Herzegovina and Montenegro were Europe's worst offenders, both ranking among the planet's top 50 nations for air pollution.

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Zorana Jovanovic Andersen, an environmental epidemiologist at the University of Copenhagen, told The Guardian newspaper that the results highlighted some chilling facts about air pollution in Europe, despite the EU's ongoing efforts to cut carbon emissions.

"Huge disparities are seen even within one of the cleanest continents," Jovanovic Andersen said. "Citizens of eastern European and non-EU Balkan countries breathe the most polluted air in Europe, and there is a 20-fold difference in PM2.5 levels between the most and least polluted cities."

But Robert Heinecke, CEO of Hamburg-based air sensor startup Breeze Technologies told Impact Loop he wasn't surprised by the latest figures:

"While in many cities there has been a trend that air pollution is getting better, the WHO guidelines are stricter than what is currently enforced in the EU, so it is still a long journey for many cities in Europe to meet the WHO guidelines."

Can Europe's impact scene solve the problem?

In Europe, a wave of startups aiming to tackle air pollution have emerged in recent years. Alongside Breeze Technologies, there is Urban Air – based in Barcelona and Antwerp – offering real-time air quality monitoring solutions. Poland's Airly also provides dense networks of outdoor air quality sensors and data analytics designed to help cities in the EU and the UK map pollution in detail and develop evidence-based clean air policies.

Paris-based Plume Labs has pioneered city-scale air pollution mapping and forecasting with their Flow personal air quality sensors. Founded in 2014, the company was acquired by global weather forecasting platform AccuWeather in 2022.

Heinecke tells Impact Loop that he thinks the latest air pollution data presents such companies with "an opportunity to do business," especially as the EU edges towards a new 2030 directive designed to push countries to limit pollution and emissions. "Any startup that can offer solutions to a city to actually measurably improve air quality and reach the new guidelines is going to be in high demand," he says.

Still, he argues that raising capital is likely to be an ongoing issue for European startups in the air pollution space. Alongside the general funding challenges facing impact startups off the back of economic jitters and geopolitical tensions in recent years, Heinecke believes some of Breeze Technologies' competitors have run into financial difficulties, due to long sales timeframes with customers, which are typically slow-moving governments, cities or municipalities.

"VCs want to see 10x or 100x in one to two years," he says. "We've had clients where we've worked together for two or three years before we got a project with them."

Breeze Technologies has actively chosen to remain bootstrapped in order to focus on the company's product and direction, Heinecke clarified.

Investor scepticism and a rocky market

In Paris, Camille Richard, Chief Impact Officer at Alter Equity, is also sceptical about the sector's growth potential. The first private equity fund in France to focus on social and environmental sustainability has yet to include an air pollution startup in its portfolio.

"When I worked at a major environmental services company, we developed an offer about air pollution towards cities and municipalities, but it didn't work so well," Richard explains.

She believes it's difficult to get public authorities to invest in pollution technologies because air contamination is a challenge that can appear less tangible or visible compared to other issues.

She points to political challenges as well:

"There's this backlash on the Green Deal," she says, referring to the EU's long term strategy to transform the bloc "into a modern, resource-efficient and competitive economy." "One of the main levers we have is to actually reduce the circulation of vehicles, which is politically sensitive right now."

Indeed, such political resistance is becoming increasingly visible across Europe, with several countries including Germany, France and Sweden scaling back electric vehicle subsidies. Plus in cities including Berlin, London alongside Paris and other French cities, electorates have been visibly divided over low-emission zones. These trends could further complicate startups' efforts to advocate for pollution-reducing policies that directly impact vehicle usage in urban areas.

Where opportunity meets challenge

Despite these hurdles, Richard sees potential at the intersection of environmental concerns and public health. "When impact and public health cross in a very obvious way like this, there are always opportunities," she notes, suggesting that health insurance companies could be promising targets for air quality monitoring investments.

Meanwhile recent data from the UK suggests that investing in cutting air pollution can pay off. A study released this week showed pollution in London has reduced after the controversial expansion of an ultra low emission zone (known as Ulez).

As Ecowatch reports, retail and leisure spending weren't impacted by the expansion, and visitor footfall has even increased by almost 2 percent, despite concerns from critics over the potential economic repercussions on local tourism and businesses.

For European impact startups tackling pollution, it seems the path forward is foggy

Consequences beyond human health

For European impact startups tackling pollution, it seems the path forward is foggy. With only two European countries meeting WHO standards, the health implications for millions of Europeans are severe, with air pollution linked to respiratory diseases, cardiovascular problems, and shortened lifespans.

And, of course the environmental consequences extend beyond human health, affecting ecosystems, agricultural yields, and contributing to broader climate challenges.

The question now is whether Europe's climate tech ecosystem can scale solutions quickly enough to protect both people and planet – and how much investors, cities and governments will be able to focus on the issue, given the current focus on defence spending and the fresh economic jitters resulting from geopolitical tensions between the US and Europe.