Thursday, September 6, 2012

Mowat Centre Report Advocates New Approach to Canadian Energy Research & Development

I saw this report referenced in the Globe and Mail article, but recommend those with an interest in structuring research and development programs to skip the filters and go straight to the Mowat Centre.  My quick impression is very favourable 

Smarter and Stronger: Taking Charge of Canada's Energy Technology Future:
This report highlights the need for Canada and Ontario to make energy technology policy a top priority and reform their approaches to supporting energy R&D.Becoming an energy technology leader should be a concrete policy commitment from both orders of government. That commitment should span the whole energy system, from supply to end-use."
A quick skim through the report is probably unfair for me to review that document, but I did get significant satisfaction from the comments on feed-in tariffs (my main criticisms are here and here).

From the report itself (.pdf):

‘Pull’ measures can play an important role in accelerating the uptake and refinement of new commercial technologies. Nonetheless, aggressive direct-pull policies, such as Ontario’s feed-in-tariff, may not be the optimal measure to incent domestic invention because of significant international spillovers they create—the growing domestic market also creates incentives in other jurisdictions. In Germany for example, the introduction of the feedin-tariff for solar installations in 2000 resulted in rapid market growth, yet not in a better competitive position for technology development: “As a result [of the subsidy], newly installed capacity in Germany represented over half of world market in 2009. In global comparison, however, the German PV industry did not gain a higher share of patents” (Peters et al., 2012, p. 4).  At the same time, domestic demandpull policies in countries like Germany and Spain fuelled innovation in foreign countries, such as China and Taiwan.
Anecdotal evidence suggests that “the evolution of a rapidly growing market may actually have created a disincentive for the development of nonincremental technology improvements” (Nemet, 2009, p. 705). This can also have an effect of ‘locking’ a technology that is currently commercially available (e.g., crystalline silicon PV), even if it is technologically inferior to newer but pre-commercial technologies.
I'll point out the Mowat Centre report references the The Clean Energy Patent Growth Index (CEPGI) in a context not dissimilar to how I used the report in a post I wrote last October, Value, LUEC Limitations, And FiT Failure.

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