Gates to invest $2B in clean energy, rejects fossil fuel divestment 

Source: Katherine Ling, E&E reporter • Posted: Monday, June 29, 2015

Bill Gates today said he plans to invest $2 billion over the next five years in advanced clean technology to “bend the curve” in efforts to fight climate change.

The current versions of green technology work only at certain times and are too expensive, the billionaire philanthropist and co-founder of Microsoft said in an interview with the Financial Times. There must be a significant investment in clean energy research and development to create “zero-carbon” energy — including tens of billions from governments, Gates said.

“We’ve got a little stuck on inventions that can take us up to 30 percent of the solution. But because they’re subsidized, they’re not economically viable,” he said.

“They’ll take something like solar PVs [photovoltaic panels] and say when the sun is shining that daytime energy will replace hydrocarbons. That is completely uninteresting, because you still want to heat apartments at night.”

He added, “There’s no battery technology that’s even close” to helping provide 24-hour reliable power.

Gates said he has already invested about $1 billion directly in about 15 startups and indirectly in 30 more. “Over the next five years, there’s a good chance that will double,” he said.

He stressed the importance of high-risk technologies that will truly make a difference in cutting carbon, mentioning fuels from sunlight or “solar chemical” power and high-altitude wind generation — capturing the jet stream. Gates has already invested hundreds of millions of dollars in TerraPower, a company developing a next-generation nuclear reactor that runs on depleted uranium and produces less waste.

As co-chairman of the American Energy Innovation Council, Gates and several other prominent CEOs called on the U.S. government to roughly triple the R&D budget to ensure future economic competitiveness, national security and environmental protection, compared with the current $5 billion annual investment that is about half of what the nation spends on potato chips and tortilla chips (Greenwire, Feb. 24).

More efforts should be focused on research and technology because “sciences change the game,” in comparison with the movement to get investment funds to dump fossil fuel holdings, Gates said.

“I don’t see a direct path between divesting and solving climate change,” he said. “I think it’s wonderful that students care and now the pope cares. But that energy of caring, I think you need to direct it towards something that solves the problem.”

He also said there should be better incentives for energy companies to take more risks and develop innovative technology, similar to the pharmaceuticals industry.

“They’re supposed to provide power at a certain bid cost,” Gates said. “Would they get rewarded if they had a breakthrough in technology? Not much.”

He compared the clean energy space with that of the software industry 40 years ago, with winners far from clear.

“If I came and talked to you about software in the late 1970s, I would tell you: ‘Hey, somebody’s going to make a lot of money. Now there’s a ton of software companies whose names will never be remembered. … If you happened to pick Microsoft, Apple or Google, you would have made lots of money,” he said.

Gates’ comments come a week after the White House announced $4 billion in mission-driven funding commitments to boost early-stage clean energy technology and the creation of several federal programs to support such investment, including a Clean Energy Impact Investment Center supported by the Energy Department’s national laboratories and expertise (E&E Daily, June 16).

Despite numerous calls for larger R&D budgets and general support for research on both sides of the aisle, federal spending does not look to be changing much — at least through next year.

The House passed a fiscal 2016 DOE budget at the beginning of May that would provide $10.3 billion for science and energy programs at the agency, a slight boost over fiscal 2015 enacted levels, with an increase for nuclear and fossil fuel research and cuts to clean energy programs (Greenwire, May 1).

Next year’s energy funding bill approved by the Senate Appropriations Committee last month would cut almost $790 million, or 29 percent, for DOE’s Office of Energy Efficiency and Renewable Energy compared with the White House’s requested level (Greenwire, May 21).