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BMO commits $50M to Bill Gates’ Breakthrough Energy Catalyst

BMO Financial Group has become the first Canadian company to join the Bill Gates-founded Breakthr...

IMAGE: Jonathan Hackett, BMO's head of sustainable finance

Jonathan Hackett, BMO’s head of sustainable finance. (Courtesy BMO)

BMO Financial Group has become the first Canadian company to join the Bill Gates-founded Breakthrough Energy Catalyst, committing $50 million in investment capital.

Breakthrough was created in 2015 by Gates and a group of investors. It is comprised of investment funds, nonprofit and philanthropic programs and policy efforts all aimed at achieving a path to net-zero.

It hopes to accomplish this via “development of new net-zero energy technologies, championing policies that speed innovation from lab to market, and bringing together governments, research institutions, private companies, and investors to expand and enhance clean-energy investment,” according to its website.

The Catalyst initiative was launched six months ago as a financial model to bring the public and private sectors together to scale energy transition technologies.

BMO’s commitment

BMO will commit the $50 million over five years to as-yet-unnamed projects as a scaling partner. It will also provide extensive project finance capabilities and the expertise of its Energy Transition Group, which was established in 2021 along with the BMO Climate Institute.

According to Jonathan Hackett, BMO’s head of sustainable finance and the co-head of the Energy Transition Group, the bank got involved with Breakthrough as a result of its work with the World Economic Forum in 2021.

“There was just a fantastic alignment, I think, between the goals of their organization and the strategy being taken to address our pledge towards net-zero and our commitment on climate change,” said Hackett.

He called it a “point of pride” to be the first Canadian company to join the initiative.

Hackett wouldn’t disclose any of the projects being considered for funding, nor any anticipated timelines for completion. But he said “sustainable aviation fuel, green hydrogen, direct air capture and long-duration energy storage,” are sectors the BMO team focuses on, and Catalyst has singled out as well.

Projects which could receive funding won’t necessarily be Canadian. Breakthrough Energy Catalyst operates more like a global think tank and the technological solutions needed won’t necessarily come from Canada, or North America.

Hackett said BMO is also open to more than just the initial $50-million contribution.

“We’re not in this to be a passive participant,” he said. Decarbonization of the economy will take much more than the four areas of technology Hackett initially singled out, so he’s “sure there’s another horizon of technologies we’ll look at” in continuing the Breakthrough partnership.

Breakthrough Energy Catalyst partners

Also joining Catalyst the same day as anchor partners were HSBC and the Chicago-based impact platform Builders Vision. The group’s initial partners were American Airlines, ArcelorMittal, Bank of America, the BlackRock Foundation, Boston Consulting Group, Citi, General Motors, IKEA Foundation, Microsoft, Shell and State Farm. It also has public partnerships with the European Commission, the U.S. Department of Energy and the United Kingdom.

“The products and industries we hope to scale through Catalyst require a truly global effort. Our new partners help accomplish that with HSBC’s deep knowledge of the Asia Pacific market and BMO’s experience in the North American market,” said Jonah Goldman, the managing director of Breakthrough Energy in a statement. “We are also grateful to partner with Builders Vision and its innovative approach to using philanthropic resources to create the market environment for zero-carbon solutions to flourish.”

Breakthrough also contains an Energy Fellows program which funds climate technology projects to support commercialization, including a stipend for living expenses, funding for technology and product development. The 2021 inaugural cohort included eight fellows.

The organization also encompasses Breakthrough Energy Ventures (BEV), an investor-led fund with the same goal. It includes Breakthrough Energy Solutions Canada, announced in May 2019 with an initial investment of up to $30 million.

It is a partnership with the Canadian government under Natural Resources Canada’s Energy Innovation Program for the development of clean energy technologies in the electricity, transportation, building and manufacturing sectors. Ten winners were chosen from 22 finalists to receive part of $40 million in total investments.

BEV’s investors include Jeff Bezos, Michael Bloomberg, Richard Branson, Tobias Lütke, Jack Ma, Reid Hoffman and more.

BMO says it has been carbon neutral in its own operations since 2010. Last year, the bank announced its ‘Climate Ambition’ commitment to deploying $300 billion in sustainable lending and underwriting to companies pursuing sustainable outcomes by 2025.

It also ranked first among North American banks for the third consecutive year on Corporate Knights’ annual top-100 most sustainable companies list.

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