Breakthrough Energy Catalyst eyes investment to scale up direct air capture, green hydrogen, aviation fuel and energy storage technologies
Grean energy and clean technology projects in the US, EU and UK could be in line to benefit from a $15bn investment fund backed by Bill Gates, according to reports.
Breakthrough Energy Catalyst (BEC) is planning to provide public-private investment to subsidise the scaling up of technologies including direct air capture, green hydrogen, aviation fuel and energy storage technologies, according to the Financial Times.
The fund has so far raised $1.5bn in private capital from philanthropic organisations and companies which it said would be use to help scale up development of new technologies designed to support the net zero transition.
Speaking to the FT, BEC managing director Jonah Goldman confirmed that the fund would mobilise as much as $15bn – ten times the initial investment – by using a series of partnership agreements and ‘innovative financial structures’.
“We are last-mile financing and so we will be the most risky capital in there,” Goldman added. “We’re really trying to demonstrate which of the technological pathways are going to be most effective.”
Part of the Breakthrough Energy group, which was founded by Microsoft billionaire Gates in 2015, the new fund aims to provide venture capital to green tech start-ups, and boasts a raft of influential billionares as board members, including Indian businessman Mukesh Ambani, Amazon founder Jeff Bezos, Japanese tech entrepreneur Masayoshi Son, and British hedge fund manager and philanthropist Sir Chris Hohn.
The new BEC fund is designed to provide capital from philanthropic donations, sub-market equity investments, and product offtake agreements in order to invest in large projects that wouldn’t otherwise be financially viable.
Its aim is to create markets for green products and technologies, thereby bringing down the cost of production for materials such as green steel and green hydrogen. Corporate backers include steel group ArcelorMittal and carmaker GM, alongside American Airlines, the BlackRock Foundation, Bank of America and Microsoft.
Several governments are also supporting the fund, including the US Department of Energy, the UK and the EU, where there is a $1bn partnership agreed with the European Commission.
Goldman told the FT that the new fund could speed up the widespread adoption of greener fuels in industries such as aviation.
“There’s six different ways to do sustainable aviation fuel, and we know they all work and they all have different challenges,” said Goldman. “We just need to build a bunch of them to see where we’re able to get the green premium reductions, through things like engineering learning. We know you can do it. You just need to see if you can do it at scale in an economic way.”