Bill Gates Jump Starts China Carbon Market

Bill Gates, the digital pioneer who built one of the world's greatest fortunes building Microsoft, is going green in a predictably big way.

Gates is partnering with Peter Yates, the former chief of an Australian investment company on a $650 million carbon trading fund in China, Yates told The Australian. The Bill And Melinda Gates Foundation will stake the fund to about 25% of its initial funding, and Yates will direct its management company, Peony Capital.

The Foundation could not verify the story Friday. Spokeswoman Aimee Segal said the foundation's investments are handled through a separate trust, and that she could not verify that the trust had invested in the new carbon fund.

Besides having a sing-song quality to their names, the partners bring tremendous credibility to the project. Australia's close business ties to China make Yates an expert, and the Bill & Melinda Gates Foundation has been lauded as one of the most successful charities ever -- and one of the only charities to identify and fund effective solutions to some of the world's most intractable problems.

Speaking of intractable problems: China this year surpassed the United States as the world's leading polluter of carbon dioxide, the leading cause of global warming. It -- like the United States -- has largely resisted strict carbon reduction schemes that might harm its breakaway economic growth.

The Fund could finance a range of projects -- from wind power to energy efficiency -- to produce carbon credits that can be sold on the emerging world market initiated by the Kyoto Protocol.

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