Innovation policy more impactful on climate than a price on carbon
That’s the interesting conclusion of a report out today from The Information Technology & Innovation Foundation, a Washington, DC-based think tank that focuses on “conceiving and promoting the new ways of thinking about technology-driven productivity, competitiveness, and globalization that the 21st century demands.”
While the report may contain a few grains of truth policymakers can agree on, the U.S. economy and U.S. energy policy currently leaves very space for helping innovation in ways that can make up the ground the U.S. is losing to countries such as China, India, Germany and Denmark. Many analysts and seasoned policy pros, including those tracked here on The Energy Fix, see a price on carbon as the single biggest enabler of a cleaner, more productive, energy future for the planet.
The report, entitled “Inducing Innovation: What a
Carbon Price Can and Can’t Do,” asserts that “without breakthrough advances, it will not be possible to fully address climate change… A carbon price can be a useful tool to nudge the adoption of mature technologies, but it does little to pull forth disruptive new technology or stimulate the advance of basic knowledge upon which new technology is built.”
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The authors are Matt Hourihan and Robert Atkinson. Prior to joining ITIF, Mourihan served as Jan Schori Fellow at the Business Council for Sustainable Energy, a coalition of energy firms and utilities working to engage policymakers for market-based solutions to sustainable energy development and climate change. His previous experience on sustainable energy and technology issues includes stints in Congress and at the American Association for the Advancement of Science’s Center for Science, Technology.
Robert D. Atkinson is billed as a leading thinker on innovation economics. He has an extensive background in technology policy and has conducted “ground-breaking” research projects on technology and innovation. He is the author of The Race for Global Innovation Advantage and Why the U.S. is Falling Behind.
“Our results show that non-incremental innovation comes from investment in directed research activities and technology development — not from changes in price,” the authors say.
“It should be clear by now that a carbon price is not an adequate solution to our technology barriers and will not deliver the kinds of revolutionary technologies experts say we need. Rather, a truly effective, comprehensive approach would be to directly support the development and deployment of technology at all stages.”
How to accomplish that? We think most of us have heard this before: 1) Develop a National Energy Innovation Strategy; 2) Expand Public Investment in Clean Energy Innovation; and 3) Support Technology Throughout the Development Cycle.