Opinion | Bill Gates: How I Invest My Money in a Warming World

As we head into COP28, the annual global meeting on climate change underway in Dubai, there are two dominating schools of thought, both of which are wrong. One says the future is hopeless and our grandchildren are doomed to suffer on a burning planet. The other says we’re all going to be fine because we already have everything we need to solve climate change.

We’re not doomed, nor do we have all the solutions. What we do have is human ingenuity, our greatest asset. But to overcome climate change, we need rich individuals, companies and countries to step up to ensure green technologies are affordable for everyone, everywhere — including less wealthy countries that are large emitters, like China, India and Brazil.

Let’s start with what rich individuals, like me, can do to help. Wealthy investors have the capital to take risks, and indeed, should be taking more of them. They should be investing in companies that are developing transformative green solutions — especially solutions that have potential but are currently underfunded, including green hydrogen and carbon management. Seven years ago, I created a fund with other high-net-worth people to back companies whose products could cut at least 1 percent of the world’s emissions — knowing full well that most of the companies we’d invest in would fail. But I also knew that it was a risk worth taking.

Very wealthy individuals should also be making changes to their lifestyles to bring their emissions close to zero. If you fly in a private jet, as I do, you can afford the extra cost of sustainable aviation fuel made from low-carbon crops and waste. You’ll not only lower your own emissions; you’ll also help drive demand for clean fuel, which will increase the supply and eventually make it cheap enough to use more widely in commercial aircraft. That will be a game changer for reducing emissions from long-distance air travel, which remains one of the toughest climate problems.

In terms of scale, rich companies and governments can do even more than the wealthiest individuals and investors. They can leverage their purchasing power and buy green products to speed up the adoption of new technologies. That means electrifying their fleets of corporate vehicles, buying lower-carbon materials for construction projects and committing to use a high percentage of clean electricity.

Corporate leaders may object to extra spending, arguing that their job is to maximize the return for their shareholders. That’s true, but many companies already fund climate change efforts that don’t have as much impact as what I’m proposing: reducing what I call green premiums, the higher price tags that often come with more environmentally friendly alternatives. If they redirect the money they’re currently spending on climate change efforts into creating markets for clean products, they’ll do the most good with every dollar they spend on climate change.

Rich countries also can do more with policy, for instance, helping make clean products competitive with their conventional counterparts by creating tax incentives and a favorable environment for green alternatives. Legislation like the Inflation Reduction Act in the United States is an example of federal investments in climate, designed to accelerate decarbonization. It is especially important for the toughest industries to get off fossil fuels — such as cement and steel — and sets an example that other governments can follow.

It may take a certain leap of faith to believe that we can solve climate change. But humans have overcome the seemingly impossible before. Since the beginning of the century, the number of children around the world dying every year has been cut in half. This progress was in part the result of governments, companies and nonprofit organizations working together to solve the problem, prioritizing innovations in science and policy to bring down the cost of lifesaving vaccines that made it possible to protect far more children.

The world’s ongoing progress in health and development is inextricably linked to our ability to solve climate change. People who are healthy, with some financial stability, will be better able to cope with extreme heat, droughts and wildfires, and they will be better able to afford the technologies to curb climate change. For the wealthy, that means a continued commitment to eradicating poverty, improving health and funding programs that help people adapt to a warmer world.

While the rich bear the greatest responsibility, it will ultimately take every one of us to bring the green premium to zero, as consumers, employees and voters. Every time you opt for a climate-friendly product — whether it’s an LED bulb, installing a heat pump, eating plant-based meat or driving an electric car — you’re sending a signal to the market that this green product is in demand. As the volume goes up, the price comes down. Not only are you benefiting from buying green, but you are also part of the solution to the hardest challenge humanity has ever faced.

Bill Gates is a co-founder of Breakthrough Energy Ventures, a fund that has put more than $2 billion into companies that help reduce greenhouse gas emissions.

Source photographs by Alena Bogatyrenko and kevinjeon00/Getty Images.

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