Bill Gates on The Energy Challenge: Optimistic on Science & Business, but Not So Much on Politics

5/10/11Follow @xconomy

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be produced more efficiently, Gates said, citing steel and fertilizer as examples. That means “you’ve got to do extremely well” on the last part of the formula—the amount of carbon that gets emitted per unit of energy used.

What that means is that over the next couple decades, “we will need to invent, pilot, and deploy” a wide variety of carbon-emissions reducing technologies—things like nuclear, carbon sequestration, and renewable fuels, Gates said. Citing his favored author, Vaclav Smil, Gates said history has shown energy transformations like this can take 60 years to gain widespread adoption. “We are talking about moving faster now to change than we ever have before. We’re asking for something pretty impressive to get done,” Gates said.

On the differences between the computer industry and cleantech:

In the world of software, product life cycles are only two to three years, and it’s not subject to any complex regulatory regime, Gates said. In energy, if you want to build a new natural gas, nuclear, or renewable facility, investors need to look at a 40-year time horizon for the investment to make sense. “The decision you have to make now is based on government policy way out there decades in the future,” Gates said.

On the U.S. as a center for cleantech innovation, compared with China:

In terms of innovation, “The U.S. still has a dominant position,” Gates said. While manufacturing costs and land costs may be lower, and the Chinese government has made some big investments, most of the real innovation is still occurring in the U.S., he said. The innovation will flow from the place that has the most great universities, and a culture for financing risky startups.

“I know of 100 great new energy ideas, and I’d say 70 percent of them are here in the U.S., even if they are looking at doing some manufacturing there [in China],” Gates said.

On the potential for nuclear energy, particularly TerraPower, the company Gates is backing with Nathan Myhrvold:

TerraPower is “so cool” on paper, Gates said, but he cautioned against people getting irrationally exuberant about its potential for clean, low-cost nuclear power. While TerraPower has “brilliant people” working together here in Seattle, “the difficulty in going from what’s on paper to an actual plant is immensely difficult,” Gates said. Terrapower is really “one of 1,000 cool companies we need to get behind to maximize our chance that 15 years from now we’ll have multiple technologies that will work, and are cheap, and can move into maximum deployment mode.”

On the potential for innovators to help solve the climate problem:

The amount of sun that hits the Earth is “gigantic,” Gates said, and so is the amount of energy released from a uranium reaction. Meeting scientists who think about harnessing ideas that like that is “a lot of fun,” Gates said, but also worrisome. The U.S. is the richest country on Earth, and “we ought to take the lead,” in investing in clean energy technologies, Gates said. But the European Union also hasn’t done enough, and China “will have to be pushed,” he said. Some of the debates about climate science are disturbing, Gates said, making him sometimes wonder, “Do facts matter?” But then again, he said the political system we have today has helped give rise to continual improvements in the standard of living in developed countries, so maybe it’s not completely broken, Gates said. “You gotta persevere,” he said.

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