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Bill Gates secures $1bn from US firms for climate fight
Cecilia Jamasmie | September 20, 2021 | 

Gates’ Breakthrough Energy’s efforts include investment vehicles, philanthropic programs, policy advocacy, and other initiatives, such as Catalyst. (Image courtesy of World Economic Forum | Photo by Moritz Hager.)

Bill Gates has secured more than $1 billion in corporate funding for Breakthrough Energy Catalyst from seven large US companies to develop some of the world’s most challenging clean-energy projects.


Breakthrough Energy, a non-profit founded by Gates in 2016, said on Monday that the backers — Microsoft, BlackRock, General Motors, American Airlines, Boston Consulting Group, Bank of America and ArcelorMittal — were providing a mix of equity capital and offtakes — purchase agreements tied to the projects.

The Washington-headquartered firm said the funds will be allocated to Breakthrough Energy Catalyst (BEC), a project launched earlier this year that’s aiming to finance, produce, and buy new solutions that will help underpin a zero-carbon economy.

BREAKTHROUGH ENERGY CATALYST WAS LAUNCHED EARLIER THIS YEAR TO FINANCE, PRODUCE, AND BUY THE NEW SOLUTIONS THAT WILL HELP UNDERPIN A ZERO-CARBON ECONOMY

“We’re not doing this to make money,” Larry Fink, chief executive of BlackRock’s CEO, said in a TV interview with Gates. “We’re doing this to seed these ideas, to rapidly accelerate ideas.”

BEC focuses on fast-tracking the commercial viability of four key solutions considered key to the world’s climate crisis: green hydrogen, sustainable aviation fuel, long-duration battery storage and carbon capture from the air.

None of those four technologies are currently cheap enough to spur widespread adoption, Gates said during the interview. “Catalyst is designed to change that and provide an effective way to invest in our clean technology future,” he noted.

BlackRock has pledged $100 million over five years through its charitable foundation, while Microsoft, American Airlines and ArcelorMittal have committed the same amount. The others did not disclose the size of their investments.

Aditya Mittal, CEO of ArcelorMittal, said initiatives like Breakthrough Energy Catalyst are “critical” for the company and the wider steel industry.

“The steel industry knows how to decarbonize – essentially what is missing is the availability of clean energy at competitive prices that provides the foundation for us to really accelerate,” he said.

Metals needed

The world needs aluminum, cobalt, copper, lithium and nickel to propel the switch to a green economy. More than $1 trillion of investment will be required in those key commodities over the next 15 years just to meet the growing demands of decarbonization if global warming is to be kept to less than two degrees by 2050, a recent study by consultancy firm Wood Mackenzie showed.

That conclusion was backed in a highly anticipated report by the UN’s climate panel. The Intergovernmental Panel on Climate Change (IPCC) warned in August that limiting global warming to close to 1.5 degrees Celsius or even 2 degrees Celsius above pre-industrial levels “will be beyond reach” in the next two decades without immediate, rapid and large-scale reductions in greenhouse gas emissions.

Gates is not the only billionaire involved in pushing green technologies. Tesla CEO Elon Musk vowed to invest $100 million in new carbon capture solutions and Amazon founder Jeff Bezos created last year the $10 billion Bezos Earth Fund, equivalent to about 7% of his net worth, to stop climate change.

Gates Raises $1 Billion as Corporate CEOs Join Race to Scale Clean Tech

Erik Schatzker and Akshat Rathi
Mon., September 20, 2021

LARRY FINK BLACKROCK CEO

(Bloomberg) -- Bill Gates raised more than $1 billion in corporate funding for Breakthrough Energy Catalyst, drawing on BlackRock Inc.’s Larry Fink and Microsoft Corp.’s Satya Nadella to rally support for some of the world’s most demanding clean-energy projects.

BlackRock is making a five-year, $100 million grant from its charitable foundation. Microsoft also is donating $100 million. The other backers -- General Motors Co., Bank of America Corp., American Airlines Group Inc., Boston Consulting Group and ArcelorMittal SA -- are providing a mix of equity capital and so-called offtakes, or purchase agreements tied to the projects.

“We’re not doing this to make money,” Fink, BlackRock’s chief executive officer, said in an interview together with Gates on Bloomberg Television. “We’re doing this to seed these ideas, to rapidly accelerate ideas.”

Gates established Breakthrough Energy Catalyst to accelerate the commercial viability of four key solutions to the climate crisis: green hydrogen, sustainable aviation fuel, long-duration battery storage and carbon capture from the air. In practice, Catalyst will supply the cash needed to get capital-intensive projects off the ground, before debt financing and government funds can be raised to cover the remaining 90% of the cost.

Today, none of those four solutions is cheap enough to spur widespread adoption. For example, jet fuel derived from more-sustainable sources such as industrial waste or alcohol is about five times as expensive as kerosene.

Ideally, the Catalyst projects will, by operating at scale, prove that the underlying technology can be cost-competitive and eliminate the “green premium” over conventional standards.

“The model here is what happened with wind and solar and lithium-ion,” Gates said. “Those products had very high prices compared to conventional techniques, and fortunately Germany and Japan and other buyers funded the scale-up, and now those products fit the normal sort of client-investing metrics.”

The difference now is speed. Governments that signed the Paris Agreement on climate in 2015 are racing to meet a mid-century goal of reaching net zero, which requires not only emissions cuts but also removing carbon dioxide from Earth’s atmosphere.

Nine of the world’s largest economies and many companies, including BlackRock, have pledged to reach that target.

“The pathway for solar and wind, that was a 30-year pathway to make it competitive with hydrocarbons,” Fink said. “We don’t have 30 years. We don’t have 10 years.”

Gates, who has estimated the cost of reaching net-zero emissions at $50 trillion, is hoping his program becomes a model for public-private cooperation to address the threat of climate change.

In August, Catalyst agreed to raise $1.5 billion in return for billions more in support, some of it contingent on legislation, from the U.S. Department of Energy. Separately, Catalyst committed $500 million in June in return for matching funds from the European Commission and European Investment Bank for a similar effort across the Atlantic.

Gates first pitched Nadella and then Fink, who said he in turn had some “very serious conversations” persuading fellow CEOs to back Catalyst. ArcelorMittal is making a $100 million equity investment over five years, and American Airlines also is contributing $100 million. GM, Bank of America and BCG didn’t detail their involvement.

Up-front expense and scalability are two major differences between most tech products and clean-energy solutions. While little to no capital may be required to develop a smartphone app, even a pilot project in carbon capture can cost tens of millions of dollars.

Also, large investors have mostly steered clear of ambitious green undertakings because of uncertain returns. Gates himself has noted publicly that he “lost a lot of money” on battery development.

Fink, who oversees almost $10 trillion in assets at BlackRock, said there’s an “enormous” amount of capital waiting to invest in technology proven to reduce the green premium.

“I’m not frightened about where the money’s coming from,” he said. “I just want to make sure that we have the science and technology and the viability. Once we know that, the capital will be there.”

Coinciding with the infusion of new cash and commitments, Catalyst is inviting would-be projects to fill out a request for information. That’ll be followed by a more precise and technical request for proposal, or RFP, possibly by the end of the year.

Gates, in the interview, laid out a timeline and some parameters:


Catalyst will start funding projects in 2022, probably several in each area.


Funding will cover early-stage costs such as design and add up to “maybe 10%” of the total cost.


The plan is to recruit a total of about 20 companies as anchor partners and increase the pool of private capital to $3 billion.


Green hydrogen and sustainable jet fuel are advanced enough that they could “get to a low price” in three to four years.

“I’d be very disappointed if we don’t see a dramatic reduction in the green premium, even in less than five years,” Gates said. “Because that should let us do two rounds of projects, the first projects and then take the learning from those first two and a half years and do a second round that will bring the costs down even further.”

Catalyst is the latest in a series of initiatives that Gates has founded under the Breakthrough Energy banner. A venture-capital arm, Breathrough Energy Ventures, raised some of its money from billionaires Jeff Bezos and Michael Bloomberg, the founder of Bloomberg LP, the parent company of Bloomberg News. Catalyst is run separately and funded independently.

(Adds details on Microsoft’s role in second paragraph.)