Bill Gates new “Breakthrough energy coalition”
The need of more clean energy technologies in the coming decades is certain, as the global population and the planet’s temperature continue to rise. Nevertheless, clean energy investments, basic research system, and regulatory frameworks and subsidies don’t allow to create an economically attractive environment for investors. However, Bill Gates’ brand new Breakthrough Energy Coalition (BEC) might be the beginning of a private sector investment on this area.
A Global initiative to reduce greenhouse gas emissions by supporting investments on renewable energies development, was introduced last December during the COP 21 when Bill gates, the founder of Windows, launched BEC. The coalition, composed of 20 private billionaire business leaders such as Facebook founder Mark Zuckerberg, Jeff Bezos founder and CEO of Amazon, Richard Branson founder of Virgin Group, or Reid Hoffman co-founder of LinkedIn and institutional investors, aims to develop the next generation of renewable energy production. Partnering with “Mission Innovation initiative”, BEC will participate in this new economic revolution based on clean energy technologies.
Bill Gates initiative came out of the lack of private and public investment in research and development on clean energy. Considered as too expensive and high risked, this technology was the subject of venture capital in the past, such as cleantech, but had just led to the strike out of startups. Big private investors were then repealed due to its its long-term returns and its unlikeness to meet traditional market tests.
The investors’ goal consists in supporting the early stages of innovation and to build emissions-free energy production companies. But the challenge is mainly to lead innovation from the practical early stage into the marketplace, and to do so, these private investors expect to add their skills and resources to build successful companies that will provide an example, or even a proof that the market-driven clean energy economy is reliable and necessary.
Moreover, Last December Bill Gates announced a new 1$ Billion fund with internal scientific expertise made up of the members of Breakthrough energy coalition, but also Silicon Valley venture capitalists John Doerr and Vinod khosla, as well as governments, and research institutions. This fund will let investors have a closer look at university laboratories technologies than traditional Venture capital investments. It will also help companies to find strategic partners and continuous financing. With a 20-year timeline, and with important high-risk tolerance investors, climate change related problems, will be extensively funded in order to broadly commercialize clean-energy technologies.
The venture plans to develop inexpensive and reliable clean energy technology, by supporting firms having a promising experimental technology in power generation and storage, or energy system efficiency. An industry already benefiting from this kind of fund is the power fusion, Tokamak energy for example received most part of its 15$ million investment from Breakthrough Energy Venture (BEV). This has allowed to develop faster the science and engineering for Fusion.
Four investment criteria must be considered: First the technologies having the potential to reduce greenhouse gas emissions by at least half a gigaton, the potential to attract capital from other sources besides BEV and the broader BEC, the ability to demonstrate existing scientific proof of concept that can be meaningfully advanced, and the requirement of companies having included patience, judgment by scientific milestones, and significant global network.
This coalition is expected to be the lightening of a new economic growth, a market dependent on clean energy production, where everyone will have access to reliable, affordable and sustainable power, goods, food, transportation, and services with no global warming consequences. The goal is to overcome the actual economic system, for a clean energy depending on economic growth, to save the planet. BEC is basically giving energy innovation a new push up to progressively reduce the cost of energy, and by doing so transforming it into a complete necessity.