Will 2016 be the year we finally get serious about sustainability? With the start of a new year comes a new inspiring project that will influence the global population on being more responsible with their energy choices as well as bring attention to the importance of clean energy for all. We have the ability to make a difference, will this be the year we finally start doing so?
On November 29, a coalition of 28 private investors led by Bill Gates announced a new investment fund, the Breakthrough Energy Coalition, designed to help develop and commercialize new clean energy technologies to fight climate change and bring affordable, clean energy to the world’s poverty areas.
The investors, who represent a number of the world’s leading industrialists, Silicon Valley entrepreneurs, venture capitalists and philanthropists—including Mark Zuckerberg and George Soros—unveiled their new consortium with initial commitments of $2 billion as the UN Framework Convention on Climate Change negotiations opened in Paris.
The fund was co-launched with a government-led effort known as Mission Innovation. Spearheaded by the White House, the United States and 19 other countries have announced an effort to double government-sponsored clean energy research and development (R&D) by 2020. These countries—such as China, India, the United States, Indonesia, and Brazil, the top five most populous nations — represent three-quarters of global greenhouse gas emissions and more than 80% of global investment in clean energy R&D. The U.S. government spent a reported $5 billion on energy R&D in 2013, compared to $31 billion on health care research and nearly $70 billion on defense research.
The partnership between private investors and government is intentional. The “aggressive global program for zero-emission energy innovation” envisioned by the Breakthrough Energy Coalition seeks to build a public-private collaboration that uses private sector investment capital and ingenuity to commercialize technologies largely developed by government-funded research.
Despite the successful conclusion of the climate change negotiations on Saturday, the pledges submitted by countries around the world to reduce emissions still would warm the atmosphere 2.7⁰ to 3.7⁰ Celsius (4.9⁰ to 6.7⁰ Fahrenheit) above pre-industrial levels, well above the 2⁰C (3.6⁰F) threshold adopted as the upper limit of acceptable temperature increase to avoid many of climate change’s most dire impacts.
Even if these initial commitments known as Intended Nationally Determined Contributions (INDCs) were fully implemented, they would leave a gap by 2030 of roughly 14 gigatons of carbon dioxide equivalent (14 Gt CO2eq) per year above levels required to hit the 2 degree target, according to a report released this fall by the UN Environment Programme.
Clean Energy for All
Part of the reason emissions are rising so rapidly is that many of the world’s poor still lack adequate access to energy. According to the International Energy Agency, nearly 1.3 billion people, or 18 percent of the world’s population, lack access to electricity. Many hundreds of millions more lack access to clean cooking fuels. As these people join the world’s middle class and secure a measure of prosperity, they seek Western patterns of consumption of electricity, transportation, cooking, and heating that in the 20th century—and to a large degree still today—could be achieved only with fossil fuels.
Gates and his compatriots hope to change that.
“This is about cheap, clean, reliable energy. And there are many paths to get energy generation to be lower-cost than hydrocarbon-based generation and still be zero CO2 emissions,” Gates recently told reporters. “That’s really what you want, because bringing the price of energy down is pretty fantastic.”
Despite the substantial recent gains in wind and solar energy and energy efficiency in recent years, zero-emissions energy still represents a small share of global energy. In 2013, only 19 percent of global energy use was from non-fossil sources, and much of that was from nuclear, large-scale hydropower and biofuels—all technologies that some (but not all) experts do not consider sustainable. Getting this figure close to 100 percent will be an enormous task. Many believe that with current technology, it is not economically or politically feasible. The International Energy Agency’s “Two Degree Scenario” projections to 2050 conclude that the least-cost option still entails 30% of emissions reductions from technologies that are not yet commercially viable, such as advanced biofuels and carbon capture and storage.
To develop new clean energy technologies—and explore and bring to market others that may not yet even be in the development stage–Gates seeks to invest “broadly” and “boldly” with a large number of institutional investors in promising early-stage approaches. The coalition is also going to seek out opportunities to bring down costs of existing technologies—solar energy comes to mind—to make them more widely competitive.
Show Me the Money
To achieve its goal, investments need to be scaled up quickly. “Over this next decade, if we had $20 billion of high-risk private capital, then that would get towards the size of the problem,” Gates said in an interview. “The investments will be different, but if you have 200 companies, that’s enough money that you’d think: ‘OK, a hundred million each, on average.’”
The Coalition is setting its sights on big investors to reach that $20 billion goal. But Gates noted that only one institution—the University of California—is on board so far.
“When the fund structure is more concrete, we’ll be able to go to institutions that care about climate change—university endowments, some pension funds, some foundations and endowments,” Gates said. “I think a fair percentage of those may join.”
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