Bill Gates on Climate Change

This is my summary of Bill Gates thoughts on Climate Change.

First, he makes the assumption that the US and other rich nations need to get to Net Zero (NZ), hopefully by 2050.  For this we will need new breakthrough technologies that are both cost-effective and can be massively scaled.   While the solutions may be more expensive than current practices the difference in cost (which he calls the green premium) must be manageable in order for them to be useful to developing countries.

He makes two other points which are controversial.  One, is that we should not make any investments in any technology that will not be part of a net zero solution.   Secondly, we should not focus on intermediate goals, e.g.  reduce carbon emissions by 30 per cent by 2030.  His starkest example is that power companies should NOT be incentivized to convert from coal to natural gas! 

Prior to reading his book I had the opposite view.  My view had been that we needed to rejoin the Paris Accords, then make specific commitments to exceed our 2030 goals, and then encourage or even pressure other countries to exceed their goals.  One of the ways to do this is to convert from coal to natural gas.  I believe that in the US the conversion from coal to natural gas has done more than all of the renewable energy projects in reducing greenhouse gas (GHG) emissions.

Gates says no.  The goal is not to meet some intermediate goal but to get to NZ as soon as possible.  Once a new natural gas power plant is built it may stay in use 30, 40, 50 or more years.  The same is true for incentives for hybrid cars including plug-in hybrids.  They may reduce GHG emissions a little but they are not part of a NZ economy.

Implicit in all of this is that we will need significant public and private investment to get to NZ.  Especially as it pertains to public investment limited resources should not be spent on anything that is not part of a NZ economy.

The main areas that need new solutions are electric energy generation, travel, food production, and specific industries like steel and cement.

The easiest for me to understand is electric energy generation.   Gates's first premise is that renewables need to be a major part of the solution but they will be insufficient to get to net zero.  The challenge is that since renewables energy production is intermittent it will not always match demand.   

In order to have a NZ grid we need renewables combined with one the following breakthrough technologies; (1) energy storage, (2)  nuclear power or (3) fossil fuel, presumable, natural gas with Carbon Capture and Sequestration (CCS).  To make these potential solutions cost-effective will need large investments in basic research and development.   Since none of the solutions are close to becoming commercial products only the federal government can fund these investments.  Once we make progress on the basic science and technology to the point where they are close to commercially viable then the private sector can fund product development.

Gates doesn't disparage choices individuals might make like installing solar panels on their properties, buying a hybrid or becoming a vegetarian.  But he says these choices should not be subsidized.  Any green technology they require material subsidies cannot be scaled to the developing world; think India or sub-Sahara Africa where currently there may be close to a billion people with no access to electricity.  They will need cost-effective solutions or they will use fossil fuels.  In fact, they will use more fossil fuels than they currently do.

Those we are concerned about climate change say "follow the science".   Gates agrees but also says follow the math and the economics.   His view is right from the Seven Habits of Highly Successful People, i.e. Plan with the End in mind.  He thinks like a project manager and a business executive.

Last point and this was not part of Gates book.  The Build Back Better Act currently proposes up to a $12,000 tax credit on EVs.   While I agree that EVs needed tax credits to get started we should not extend or enlarge these credits.   This is a subsidy for millionaires and billionaires and it is coming at the cost of limiting poverty programs like the child tax credit.   It's a reminder that the Dems have a donor class which includes wealthy suburbanites who want to drive a luxury EV or install solar panels but they want someone else to help pay.