If Amazon is going to achieve its goal of net-zero carbon emissions by 2040, it’s going to need to rely on new technology. To spur the process along, the company has a $2 billion venture capital fund to gather and grow climate tech start-ups.

Watching where Amazon is investing is one way to track innovation in the space. It can also give investors a sense of what parts of its own business Amazon intends to prioritize in the future.

“A lot of what we invest for is three to five years out,” Matt Peterson, the head of The Climate Pledge Fund at Amazon, told CNBC. “We try to look around corners to see where our needs are going to be and where the needs of other companies are going to be. I mean, with with a 2040 time horizon, you know, you can’t really afford to look one or two years out, you have to think long term.”

The Climate Pledge Fund, which was announced in June 2020, is funded entirely with money from Amazon’s own balance sheet. For Amazon, the priority is more about incubating the technologies it will need to meet its own climate objectives — making money is good, too.

“If happens to be that the companies we invest in do well and they become the next Tesla or they return a multiple of our investment, then that’s great. It shows that it’s a validation of what it is, but it’s not the main focus of the fund relative to the broader strategic goal,” Peterson told CNBC.

It’s also open to investing in companies at many different stages, and has invested from seed-stage up to series B rounds. “We can invest a million dollars in the company or invest over $100 million in the company,” Peterson said.

Amazon is not alone in investing in climate tech. The space has seen a five-fold increase in investment dollars to $32.3 billion in 2021, up from $6.6 billion in 2016, according to a recent report.

On Wednesday, Amazon announced new investments in Resilient Power and CMC Machinery and a second investment in Infinium. Amazon has previously announced investments in CarbonCure, Pachama, Redwood Materials, Rivian, TurnTide Technologies, BETA Technologies, Ion Energy, and ZeroAvia — bringing the total tally of climate tech start-ups Amazon has invested in to 11.

Amazon is still accepting applications for start-ups looking for funding. The company plans to make investments both large and small.

Here are five areas within climate tech that Peterson told CNBC Amazon is looking to invest in and how those areas track with Amazon’s current or future goals.

Food and agriculture investments
Food production requires a ton of land and fuel, food waste and spoilage result in methane emissions, and dairy and meat production releases in CO2 and methane emissions — all of which are problems for Amazon if it plans to get further into food production.

“People forget that Amazon owns Whole Foods,” Peterson told CNBC. “We have a number of opportunities and new business models around Amazon Fresh, which is our physical stores, as well as our home delivery of foods.”

He added, “If you look at where we are going in the coming years with growth in grocery and growth in meals and food in general, it’s something we want to get ahead of.”

Electrification
In September 2019, Amazon announced it was going to purchase 100,000 electric delivery vehicles from Rivian Automotive. Those vans are to be deployed by 2024 and are part of Amazon’s effort to convert its delivery fleet to 100% renewable energy by 2030.

As part of that electrification push, Amazon invested in Resilient Power, which is developing technology that builds electric vehicle charging infrastructure at one-tenth the size and installation time of existing charging technology.

and installation time of existing charging technology.

Resilient Power charging stations.
Resilient Power charging stations.
Photo courtesy Amazon.
“It’s not as sexy as, say, an EV manufacturer, but it’s just as important in my opinion,” Peterson told . “The technology that they’re really trying to update hasn’t been changed in probably 30 to 50 years. It’s ’70s-’80s style technology, with these large power stations or substations,” he said.

For electricity to go from the grid to an EV charger, it has to go through a step-down process, and Resilient Power uses semiconductors and a software control as opposed to large physical, mechanical hardware.

“We have a big need for this and as we’re mapping out our own needs for doing this, this solution is really interesting to us,” Peterson told CNBC.

Green hydrogen
Water can be split into its chemical pieces, oxygen and hydrogen, with electrical current in a process called electrolysis. That hydrogen can then be used in various ways to generate carbon-free energy.

If the energy used to power an electrolyzer is carbon-free, then the hydrogen created is called “green hydrogen.” Amazon has made several investments in this space.

ZeroAvia is building airplanes that are powered by hydrogen fuel cells — particularly important, says Peterson, as aviation will be one of the hardest industries to decarbonize.

Infinium makes electro-fuel, which would replace diesel or kerosene in aviation fuel. “The difference is instead of being extracted from the ground and refined like fossil fuels, it’s made from synthetic components. And the synthetic components are green hydrogen and captured carbon dioxide,” Peterson said.