Bill Gates backed climate fund to invest $15 billion in clean technology, reports say

Bill Gates, founder of Microsoft and philanthropist backs Breakthrough Energy Catalyst (BEC), which is a private-public fund. The fund is a part of the Breakthrough Energy Group that was founded by Bill Gates, in 2015. According to a report in the Financial Times, the managing director of BEC told the outlet that they were looking to get as much as $15 billion. Funds already raised are $1.5 billion, so far.

Jonah Goldman, the managing director of BEC told the Financial Times that they were “last-mile financing” and they would be the “most risky capital in there.” The new BEC fund is expected to provide three types of capital to fund large projects that would otherwise be financially unviable.

The three types of capital provided by the BEC fund would include

philanthropic donations
sub-market equity investments
product offtake agreements.

BEC’s main focus will be to create markets for green products and technologies. It intends to lower production costs for materials including green steel which has attracted ArcelorMittal, one of the largest steel groups in the world and green hydrogen, which has piqued the interest of many.

The founding partners and main backers of Breakthrough Energy Catalyst include the following

Microsoft
GM
ArcelorMittal
Bank of America
American Airlines
BlackRock Foundation
ECG.

Several governments have also offered support to the fund. They include

The U.S. Department of Energy
The U.K.
The E.U.

BEC Is looking to fund projects that can get some of its finance from longterm offtake agreements. Customers who are ready to pay for sustainable products such as green steel and sustainable aviation fuel will help finance large projects with offtake agreements.

Goldman also told the FT that there were “six different ways to do sustainable aviation fuel.” He said that they knew that all the ways worked and all of them had different challenges. He added that a “bunch of them” had to be built and then they had to see where they were “able to get the green premium reductions through things like engineering learning.”

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