The European Commission has signed a memorandum of understanding with Breakthrough Energy, an energy coalition headed up by Bill Gates, to set up joint investment fund called Breakthrough Energy Europe (BEE).

The venture, announced at a press event in Brussels, is intended to help Europe achieve its climate targets.

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In a statement released on Wednesday, the Commission said the $115.2m pilot fund would be used to help “innovative European companies develop and bring radically new clean energy technologies to the market.” It was also described as a pilot project that could provide a model on which future initiatives could be based.

Half of the money will come from European research and innovation investment firm InnovFin, while Breakthrough Energy will provide the other half.

The Commission said the new fund would focus on cutting greenhouse gas emissions and promoting energy efficiency in “the areas of electricity, transport, agriculture, manufacturing, and buildings.”

Commission president Jean-Claude Juncker said: “If Europe is to have a future that can guarantee the well-being of all its citizens, it will need to be climate-friendly and sustainable.”

Gates said in a statement: “The scientists and entrepreneurs who are developing innovations to address climate change need capital to build companies that can deliver those innovations to the global market, Breakthrough Energy Europe is designed to provide that capital.

“With any luck” he added, “we’ll be able to fully invest [the European fund] in less than a couple of years, and then we can come back and scale this up.”

Breakthrough Energy Ventures, founded in 2015, is an investor-backed fund with over $1bn in committed capital to build ‘cutting edge companies’ to help combat climate change. Patrons include Amazon’s Jeff Bezos, former New York City mayor Michael Bloomberg, Virgin’s Richard Branson, Alibaba’s Jack Ma, and SoftBank’s Masayoshi Son.

The venture made its first two investments in June this year, one in battery storage firm Form Energy, and another in Quidnet Energy, a company working on a technology to pump water into subsurface shale formations based on hydropower technologies.

Thus far, the group has primarily focused its investment in North America, though it now plans to expand operations into Europe, opening offices in the EU and investing in European clean-energy companies.