The drive for new, more efficient, renewable “green tech” is real this time.
For some, the importance of green tech is its ability to address concerns over damage to the planet due to the burning of fossil fuels, while for others, it’s all about reducing dependency on “foreign” oil.
But perhaps the consensus driver of green tech is the observation that there is simply greater competition than ever for scarce energy resources such as coal, oil, and natural gas. “Scarce,” of course, doesn’t mean we’re running out of carbon energy—in fact, projections are regularly enlarged and expanded regarding the quantity of carbon energy sources still available for energy production. But with demand projected to continue to grow, it looks like there’s nowhere to go but up for energy prices based on carbon.
What we need more than anything is innovation in all areas of energy policy—new technologies that make renewable energy more affordable and more easily stored, new technologies that make carbon-based energy cleaner and less-polluting, new distribution technologies such as smart grids that can get electricity where it’s needed and when it’s needed, while minimizing waste.
Innovators need functioning markets—tax policy that allows capital formation, intellectual property rights that provide the catalyst for innovation, and trade policies that allow technology to be transferred across national borders free of political manipulation and distortion.
But some want this disrupted. They want green technologies to be denied the same kinds of intellectual property protections that are guaranteed to every other innovation in every other sector of the economy. Instead, they expect innovators to be willing to invest enormous time, creativity and capital into developing green technologies and then somehow turn them over to the rest of the world for free, or under the very unprofitable terms of a compulsory licensing regime.
Such a policy would be reckless and counterproductive. You simply won’t get the desired innovation if you undermine market forces and property rights, and instead rely on governments to facilitate innovation.
Today, China is the world’s second-largest producer of solar cells, and they’re second to Japan, not to the U.S. It’s unclear why the United States should be pressed to transfer our green tech innovations to a competitor like China who is already out-competing us in at least some green tech areas.
If we’re to get the kind of green tech innovation that we need, it won’t be through abrogating property rights and destroying markets, but rather through harnessing the power of market forces worldwide to drive both the green tech revolution, and global economic recovery.