2:57 p.m. ET, November 2, 2021
Bill Gates-EU deal will "bear a lot of the burden" of creating affordable green technologies
From Amy Cassidy in Glasgow
Microsoft founder and philanthropist Bill Gates and the European Union launched a joint investment deal, aiming to provide up to half the finance needed to create affordable green technologies for Europe, which will also benefit the world, they said.
Gates formally signed the EU-Catalyst partnership on behalf of his company Breakthrough Energy Catalyst at COP26 in Glasgow on Tuesday.
“The European Commission is joining forces with Breakthrough Energy Catalyst and with the European Investment Bank. We will scale up critical green technologies and create markets for them,” said EU Commission President Ursula von der Leyen, who shared the stage with Gates and Werner Hoyer, President of the European Investment Bank.
The deal aims to mobilize up to $1 billion between 2022 and 2026 in financing projects in the hydrogen, aviation, energy storage and air capture industries. Each euro of public funds is expected to leverage three euros of private funds, according to the EU Commission.
The launch comes after it was revealed that the delivery of $100 billion per year in climate finance, which rich countries promised developing countries under the Paris Agreement, would be delayed until 2023.
But private sector investment is a critical part of the solution, according to all three signatories of the EU-Catalyst partnership.
“The total green premium right now would be about five trillion per year,” said Gates.
“Unless we reduce the cost of green products even at $100 billion — which is fair to say we need to push aggressively to achieve that — would only be less than 2% of what it would cost to subsidize these green activities for the developing countries. So, the innovation side is going to bear a lot of the burden of making it affordable for the world to do these things.”
President of the European Investment Bank Werner Hoyer added: “It is quite obvious that the SDGs (Sustainable Development Goals) and the climate objective of Paris will not be achievable with public money only. The development of these new technologies cannot wait 15 or 20 years. I don't blame private banks for instance that they do not finance this, because it is too risky for them.”
He went on to say that is why support is needed at the beginning from the EU Commission, member states and supporters like Bill Gates to accelerate the development of green technology.