Billionaire Bill Gates has taken a side in the polarized issue of whether to dump fossil fuel stocks to effect climate change or hang on to them. Unlike the Church of England and some of the Rockefellers, Gates is on the side of staying in, saying that fossil fuel divestment “probably has reduced about zero tons of emissions.”
Speaking to the Financial Times, the co-founder of Microsoft and the world’s second-wealthiest man said investments in new green technologies are a better way to cut carbon emissions.
Gates was a founding partner in the $1 billion fund Breakthrough Energy Ventures along with investors including Amazon founder Jeff Bezos and Alibaba’s Jack Ma. The fund so far has invested in at least 14 companies working on green energy projects. This includes Fervo Energy, which is working on geothermal technology, and Quantumscape, focused on improving batteries in electric vehicles.
Gates told the Financial Times that he is interested in funding companies that, if successful, reduce greenhouse gases, because he sees that as a “cause-and-effect-type thing.”
Gates’ comments fly in the face of campaigners who are urging institutions to divest from fossil fuels. For example, Fossil Free points to the success of campaigns that affected violence of Darfur, the tobacco industry and — most famously — apartheid South Africa.
- Gates’ interview coincides with the buildup to the 2019 UN General Assembly meeting and Climate Change Summit on Sept. 23, which will see dozens of heads of state meet to discuss climate change mitigation.
- Yesterday, the University of California announced that both its $13.4 billion endowment and $70 billion pension fund would be divesting from fossil fuels. Writing in the Los Angeles Times, the university’s investment officers said that they believe “hanging on to fossil fuel assets is a financial risk.” The action follows similar campaigns and actions at dozens of other universities around the world.
- Gates’s interview appeared in the FT wrapped in a bright yellow cover with an oversized headline declaring “CAPITALISM. TIME FOR A RESET,” introducing its new editorial effort called “The New Agenda.”
Karma Takeaway: Gates makes a valuable point about the need for new energy technologies to tackle climate change. What he may have missed, however, is that divestment frees up cash that can then be invested elsewhere, such as into renewable energy.