They’re more than a who’s who of Silicon Valley. The new billionaires’ clean energy club consists of the world’s tech titans, including leaders in India and China.
Microsoft founder Bill Gates announced Monday, the first day of two-week UN climate talks in Paris, that a group of 28 private investors will help countries shift from fossil fuels to energy sources that do not emit planet-warming greenhouse gases.
“Current government funding levels for clean energy are simply insufficient to meet the challenges before us,” the Breakthrough Energy Coalition says on its website. What the group promises is a “different kind of investor with a long term commitment” and "patient" capital.
Gates says the investors aim to get clean-energy ideas out of the lab and into the marketplace. In a blog post, he says that while solar and wind power could help meet the 50 percent increase in global energy demand expected by 2050, "we also need to invent new approaches."
What does he have in mind? His new white paper cites ideas such as solar paint to transform any surface into a solar panel, flow batteries to store grid-scale energy, and “solar chemical” to create fuel from the sun. He’s pledged $2 billion of his own fortune over the next five years for clean energy, including an advanced nuclear power reactor that his startup TerraPower is trying to market in China.
Other luminaries are joining his efforts. Facebook founder Mark Zuckerberg's company is increasingly using renewable energy to power its massive data centers, and Amazon founder Jeff Bezos revealed new energy-saving drones on Sunday to deliver packages in less than 30 minutes.
The group also includes philanthropist George Soros, Virgin Group founder Richard Branson, Hewlett Packard CEO Meg Whitman, climate activist Tom Steyer, Alibaba’s executive chairman Jack Ma, and Tata Group’s founder Ratan Tata.
They’ll work with 20 countries that committed Monday, as part of “Mission Innovation,” to double their spending on clean energy research and development—to about $20 billion—over the next five years. Approximately half of that total will come from the United States, which signed on along with the world’s four other most populous nations: China, India, Indonesia, and Brazil.
“Right out of the gate, this announcement gives a major boost to the Paris talks,” Andrew Steer, president and CEO of the World Resources Institute, says in a statement.
Yet experts have called for much larger investment, noting the urgent need to move away from carbon-emitting coal, oil, and natural gas. In fact, the International Energy Agency says that for the world to limit the rise in global temperatures to within 2 degrees Celsius (3.6 degrees Fahrenheit) of pre-industrial levels—the goal of the climate talks—it will need to boost investment in renewable energy technologies from $270 billion in 2014 to $400 billion in 2030.
So far, funding is falling short. In prior UN talks, developed countries pledged to spend $100 billion a year by 2020 to help poorer nations adapt to climate change and adopt clean energy. Last year, they mobilized $62 billion in public and private financing, up from $52 billion in 2013, according to the Organization for European Co-Operation and Development.
The new billionaires’ club is not the first such group trying to make up for this gap. There’s also the Cleantech Syndicate, a Chicago-based group representing 11 prominent families, and the Cleantech, Renewable Energy and Environmental Opportunities or CREO, a network of wealthy investors.
Their efforts have drawn skepticism from conservative U.S. politicians, some of whom argue that the rich are profiting from the Obama administration’s clean-tech funding. Last year, the Senate Environment and Public Works Committee, chaired by GOP climate-change denier Sen. James Inhofe of Oklahoma, issued this 67-page report: “The Chain of Environmental Command: How a Club of Billionaires and Their Foundations Control the Environmental Movement and Obama’s EPA.” Inhofe has received campaign donations from Charles and David Koch of Koch Industries, whose fortunes come from fossil fuels.
The newest Breakthrough Energy Coalition, which includes the University of California’s chief investment officer, says it doesn’t know “where the best ideas will come from,” so it will invest across several sectors, including agriculture and transportation.
“The key differentiating factor must be a credible pathway to rapid scaling—providing affordable energy to the greatest number of people without overburdening essential resources including land use,” it says on its website.
The White House, in announcing the twin initiatives of the private and public sectors, says “incredible strides” have already been made in reducing the costs of cleaner energy. It cites declines since 2008 of 90 percent for LEDs, 60 percent for large-scale solar and 40 percent for wind power and batteries. As a result, during the last seven years, it says, U.S. wind energy production has tripled and solar has increased more than 20-fold.
This good news has prompted optimism. Mark Z. Jacobson, an engineer at Stanford University, has done research that suggests renewables such as solar and wind could power the entire world by 2050.
Others are less sanguine. Jeffrey D. Sachs, a Columbia University economist, launched the Deep Decarbonization Pathways Project, enlisting 16 countries to figure out ways to shift away from fossil fuels. It finds currently available technologies won't likely be good enough to complete this transformation and that some, such as electric cars and offshore wind turbines, will need to become better and cheaper. It says some countries may need more nuclear power and others may need to keep burning coal or natural gas while capturing the carbon emissions and injecting them underground.