Accelerating Energy Innovation

Accelerating energy innovation could be an important part of an effective response to the threat of climate change. Written by a stellar group of experts in the field, this book complements existing research on the subject with an exploration of the role that public and private policy have played in enabling—and sustaining—swift innovation in a variety of industries, from agriculture and the life sciences to information technology. Chapters highlight the factors that have determined the impact of past policies, and suggest that effectively managed federal funding, strategies to increase customer demand, and the enabling of aggressive competition from new firms are important ingredients for policies that affect innovative activity.

Re-orienting current energy systems toward a far greater reliance on technologies with low or no carbon dioxide emissions is an immense challenge. At the broadest level the histories presented here are very much consistent with widely held views within the energy innovation policy literature. In general, this literature has suggested that greatly increasing rates of energy innovation requires creating significant demand for low carbon technologies, substantially increased federal funding for "well-managed" research, and in at least some cases support for the initial deployment of new technologies. As the other markets explored in this volume do not face the same degree of unpriced environmental externality, there is no straightforward equivalent to a carbon price in the history of agriculture, chemicals, IT or biopharmaceuticals. Nonetheless, our authors outline a number of ways in which public policy has often stimulated demand, particularly in the early stages of a technology's evolution, and confirm that the expectation of rapidly growing demand appears to have been a major stimulus to private sector investment in innovation. Each history also confirms the centrality of publicly funded research to the generation of innovation, particularly in the early stages of an industry's history, and highlights a range of institutional mechanisms that have enabled it to be simultaneously path breaking and directly connected to industrial practice. Our histories depart somewhat from the bulk of the energy innovation policy literature in focusing attention on the role of vigorous competition - particularly entry - in stimulating innovation, suggesting that in several industries a mix of public policies - including procurement, antitrust and intellectual property protection - played an important role in stimulating innovation by encouraging extensive competition and entry by newly founded firms. Many of the most innovative industries profiled here have been characterized by a lively "innovation ecosystem" that both rapidly incorporated the results of publicly funded research and supports widespread private sector experimentation and rapid entry. There are, of course important differences between the industries profiled here and the energy sector, but we believe that exploring the potential of these kinds of innovation ecosystems in clean energy might be a fruitful avenue for future research.

This book addresses the question: how effective are countries in promoting the innovation needed to facilitate an energy transition? At the heart of the book is a set of empirical case studies covering supply and demand side technologies at different levels of maturity in a variety of countries. The case studies are set within an analytical framework encompassing the functions of technological innovation systems and innovation metrics. The book concludes with lessons and recommendations for effective policy intervention.

This title explores the way in which public and private policy have played in enabling and sustaining swift innovation in a variety of industries, from agriculture and the life sciences to information technology.

Climate change is one of the key challenges of this century. At the same time, energy use the primary source of climate-altering global greenhouse gas emissions is increasing at unprecedented rates and is vital to the continued economic growth of developing countries. This poses a serious dilemma that can only be reconciled with new and improved clean energy technologies that balance climate change mitigation and increased energy needs in developing countries. Despite a recent increase in investment, public and private research, development, and deployment (RD&D) funding rates are well below historical levels. In addition, significant barriers impede the ability to develop new technologies, such as the uncertain future value of CO2 emissions, intellectual property rights issues, limited incentives to commercialize technologies for developing countries, and challenges with technology transfer. These factors must be overcome to accelerate innovation in the energy sector. To introduce new thinking to address these concerns, this report examines four cases from outside the energy sector where creative approaches to RD&D have successfully overcome similar barriers. The case studies review approaches to innovation by the Consultative Group on International Agricultural Research, Advanced Market Commitments for Vaccines, the Human Genome Project, and the concept of Distributed Innovation. These case studies show how creative efforts can generate valuable public goods via: (i) international partnerships between public and private actors, (ii) information sharing and intellectual property rights, and (iii) novel financing schemes.

This is an analytical assessment of how the government can accelerate development and deployment of energy technologies, for researchers and policy makers.