Without technological innovation, climate change can never be solved: Bill Gates

Bloomberg — With a recession in the offing, businessman and philanthropist Bill Gates is preparing a new fund for Breakthrough Energy Ventures (BEV) to back the companyinnovators in the climate sectorafter two US$1 billion funds that have helped finance some 100 companies.

“Even though the enthusiasm for investing in tech and climate companies has waned a bit, I still think we’ll be able to come up with the money,” Gates said on the latest episode of the Bloomberg Green podcast Zero. “It’s not as easy as it was, say, six months ago, but we’re looking at a new round for startups and a group under the leadership of Breakthrough Energy Management making later-stage investments.”

Even though companies like Tesla (TSLA) have helped make the dream of electric cars an increasingly mature reality, and that solar and wind energy now provide cheaper energy than fossil fuel alternatives, many of the technologies needed to reduce emissions in other sectors are still in their infancy. The $374 billion provided by the United States’ Inflation Reduction Act (IRA) to support climate and energy-related technologies is expected to spur innovation to address these challenges.

For his part, Gates hopes his work with Breakthrough iAlso promote a transformation of the world economy that brings us closer to a world of zero emissions. Many of the companies BEV currently invests in are seeking to scale up innovations in carbon-intensive but unglamorous industries such as low-carbon steel and cement.

“Without innovation, climate change will never be solved,” Gates said.

Microsoft co-founder (MSFT) joined Zero to discuss how BEV is helping drive innovation, as well as its involvement with the IRA, which was reported on in more detail by Bloomberg in August. He also discussed how Europe can tackle emissions while facing an energy crisis.

This is an edited and condensed version of Zero’s interview with Gates.

akshat: In August, you said that the Inflation Reduction Act can turn American innovations into American industries. How does the law get it?

gates: Much of the money in it is for things like long-term storage, green hydrogen, improving electricity transmission, direct air capture [y] zero-carbon manufacturing processes, including cement and steel. In the early stages, a low-emissions way of making cement will be more expensive, meaning there is a huge green premium.

akshat: Simply put, the green premium is the difference in cost between doing something in a way that produces greenhouse gases, and doing the same thing without releasing those emissions.

gates: Yes. The magic comes when the green premium reaches zero, so you can say to middle income countries (which emit 65% of emissions) “This new way of making cement has no green premium”. That is the only way to get to zero, as rich countries are not going to subsidize trillions of dollars, and middle income countries are not going to stop providing basic housing to their citizens when they know that rich countries are responsible for historical broadcasts.

Akshat: If there was one sector of the tech space that I had to pick and say that I’ve been blown away by the sheer number of ideas that come out of it, for me it’s carbon removal. Is it a different answer for you?

gates: I would say that the various agricultural innovations are something of an awe to me. The basic idea of ​​how nature produces food. For example, there are funds to improve photosynthesis itself and design it to be twice as efficient. I always thought that farming would be the most difficult, but I see many things there.

akshat: What is happening here in Europe with the Ukraine war is going to be spectacularly bad for people because of high energy prices. How do you think Europe should deal with this while maintaining its climate goals?

gates: Yes, it is a very scary situation. Unfortunately, most things related to climate are, at best, five or ten year solutions. So when people say to me, “Hey, we love the climate stuff because we can tell Putin we don’t need him,” I say, “Yeah, in 10 years, call him and tell him you don’t need him.” So it’s a very tough set of trade-offs. Very unexpected. I think in the long run, it’s good for the climate. In the short term, any solution has to be found, even if it means that emissions are going to go up. And the sooner that war ends, the better, but there are a lot of considerations that need to be taken into account to end it.

With the assistance of Christine Driscoll.

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Without technological innovation, climate change can never be solved: Bill Gates