How Market Innovation Is Reframing the Climate Debate

By all accounts, climate change alarmists are on the defensive—politically, scientifically, I would even say morally (see Bill Gates’s comment below). We could leave it at that. But there may be hope for a truce in this conflict—and if so, capitalism can take the credit.

The negatives for the climate change alarmists are substantial. Here are some:

• President Trump’s policies have deregulated oil and gas and withdrawn many subsidies for “clean” alternatives; the shock of the Iran war has made the importance of traditional energy more visible than ever. 
• A conflict occurred over the manual that the National Academy of Sciences, Engineering, and Medicine routinely prepares to help federal judges deal with complicated scientific issues. The latest (2025) edition had a clearly biased chapter on climate change. Under political pressure, the publisher, the Federal Judicial Center, withdrew it, causing outrage by some; for others, it reaffirmed scientific integrity. 
• Another embarrassment for alarmists is the recent retraction of a 2024 article in Nature. It predicted a stunning 62 percent decline in world GDP by 2100 due to climate change. Widely reported findings didn’t stand up to scrutiny—neither the predictions nor the uncertainties surrounding those predictions. So Nature took the article back. 
• Local opposition to wind and solar power projects is high and perhaps growing. Robert Bryce tallied 735 rejections or restrictions on wind and solar between 2015 and 2024.
• Philanthropist Bill Gates, who in 2021 wrote a book emphasizing the dangers of climate change, has backed off. Other problems are more critical right now, he said in an October 2025 GatesNotes blog post. “Although climate change will hurt poor people more than anyone else, for the vast majority of them, it will not be the only or even the biggest threat to their lives and welfare. The biggest problems are poverty and disease, just as they always have been.” 

I could go on. 

So what has been the response from the once-prevailing climate alarmists? For the most part, the response has been negative.

For example, in a Nature article, activist climate scientist Michael Mann said that Bill Gates created a “false trade-off between climate action and public health.”  Mann wrote: “Human-caused climate change will exacerbate pandemics, as it did for COVID-19, and vector-borne diseases, such as malaria. How Gates or anyone else proposes to ‘get rid of malaria’ in a rapidly warming world is anyone’s guess.”

Bill McKibben, a long-time environmental activist, was more political in his comments on Gates. He wrote on his Substack column: “The fact that Gates framed all this in a way designed to appeal to the president is so obvious that it hardly bears mentioning . . . .” And, “He [Gates]’s really not the guy to be listening to on this stuff. Really.”

 A Secret Weapon?

But some who promote decarbonization are not so negative, perhaps because they realize they have a secret weapon: geothermal energy.

Fervo Energy, a nine-year-old company building a geothermal project in southwestern Utah, just raised $1.89 billion in its initial public offering on May 12—far more money than analysts expected. The new excitement over geothermal mostly stems from its potential to power AI data centers, but if it succeeds, it could be a bonanza for those seeking to reduce carbon emissions.

Dan McCarthy, a writer for Canary Media, said of Fervo’s public offering: “The debut is a major moment for geothermal energy, which can deliver carbon-free power around the clock but has remained a marginal source of electricity worldwide given its serious geological limitations.” 

Make that “geological limitations of the past.” Of course, it will take years for geothermal energy to become a significant part of the energy world; this relatively new industry faces multiple challenges. But the tight geographic limitations have loosened enormously.  

Can We Find a Place for Geothermal?

We normally think of geothermal hotspots as unusual volcanic substrates, such as those under Yellowstone National Park or in a few countries like Iceland, too rare to be widespread purveyors of energy. But Fervo and other companies like Calpine and Ormat now use techniques collectively called enhanced geothermal systems, or EGS. They have overcome many limitations of the past.

These techniques were developed by the private sector, specifically, the natural gas and oil industries. Discoveries of horizontal drilling and hydraulic fracturing (fracking) dramatically increased U.S. energy production and made the nation a net exporter of natural gas and petroleum. Tim Latimer, CEO of Fervo, spent some of his early career as a drilling engineer (he is still in his thirties). His company is now using such techniques to obtain underground heat in geographical areas that never could have been productive in the past.  

And politicians seem to like geothermal. Ivan Penn and Brad Plumer of the New York Times summed up the reasons: “Geothermal has support across the political spectrum because it can produce electricity without any planet-warming emissions while operating 24 hours a day, unlike wind and solar projects.”

In sum, the tools of capitalism—in this case, the companies that pioneered fracking and innovative drilling—have enabled a tremendous breakthrough. It’s a reminder that the private sector can often address, and even solve, environmental problems.