Chapter

10. The Role of Energy Technology Policy alongside Carbon Pricing

Editor(s):
Ian Parry
Published Date:
March 2015
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Author(s)
Richard G. Newell

Key Messages for Policymakers

  • In the context of a future carbon tax or market-based trading system, advanced energy technologies offer the opportunity to significantly reduce costs and expand options for meeting emissions reduction targets.

  • There are two specific market problems to consider in the realm of GHG-relevant technology innovation: the environmental externality of global climate change and issues related to the market for innovations.

  • This chapter presents a two-part strategy to climate innovation that directly confronts these two problems: (1) establish a price on GHG emissions through a carbon tax or market-based trading system, supplemented by permanent tax credits for all (not just energy-related) R&D; and (2) increase public funding for basic strategic research inspired by critical, climate-related needs.

  • This approach seeks balance by increasing both the demand for and the supply of GHG-reducing innovations. Pursuing either demand- or supply-side measures alone, but not both, will likely lead to higher costs or missed opportunities in achieving emissions targets.

  • The innovation strategy also aims to harness the power of private sector incentives for societal gain, recommending that the direct governmental research role complement, rather than substitute for, activities commonly undertaken by industry. This strategy emphasizes those aspects of the overall innovation process that the private and public components of the system are best oriented toward advancing.

Introduction and conceptual background

Substantial reductions in U.S. greenhouse gas (GHG) emissions will require large-scale innovation and adoption of GHG-reducing technologies throughout the U.S. economy, including technologies for increased energy efficiency, renewable energy, nuclear power, and carbon dioxide (CO2) capture and storage. In the context of a policy regime that places a price on GHG emissions – either in the form of a carbon tax or market-based trading system – advanced energy technologies hold the potential to significantly lower costs and expand options for meeting GHG mitigation goals. While the importance of new technology in solving the climate problem is widely understood, there is considerable debate about what specific public policies and programs are necessary to bring about these technological changes as effectively and efficiently as possible.

The proposed climate technology innovation strategy presented in this chapter is based on the simple principle that, within a market-based economy, success is maximized if policies directly address specific market problems. In addressing such problems, policies should be designed to harness the power of private sector incentives for societal gain, and the direct governmental research role should be designed to complement, rather than substitute for, activities commonly undertaken by industry.

In the context of GHG-relevant technology innovation, there are two principal market problems. First and foremost, there is the environmental externality of global climate change. If firms and households do not have to pay for the climate damage imposed by their GHG emissions, then these emissions will be too high, and demand for GHG-reducing technologies will be too low. In turn, there will be insufficient incentive for companies to invest in mitigation technology research and development (R&D), because there will be little market demand for any potential innovations that result. A market-based emissions policy that places a price on GHGs is widely accepted to be a cost-effective response to this issue.

Second, there are problems specific to the market for innovations – not just with respect to climate, but more broadly.1 Knowledge, just like a stable climate, is a public good. It is well known that individual companies cannot capture the full value of investing in innovation, as that value tends to spill over to other technology producers and users, thereby diminishing individual private incentives for R&D.2 This problem tends to worsen the more basic and long term the research (and may be exacerbated by technology transfer to other countries without sufficient intellectual property protection). Well-targeted policy that boosts climate technology innovation therefore has the potential to lower the overall cost of attaining long-term climate goals.

The proposed strategy thus has two main parts to directly confront these two market problems: (1) establish a price on GHG emissions through a carbon tax or market-based trading system, supplemented by permanent tax credits for all (not just energy-related) R&D; and (2) increase public funding for basic strategic research inspired by critical, climate-related needs. The total revenue required for these purposes would be on the order of $10–15 billion per year.

Taking these parts together, the strategy seeks to increase both the demand for and the supply of GHG-reducing innovations in a balanced way – one that emphasizes those aspects of the overall innovation process that the private and public components of the system are best oriented toward advancing. R&D push without the pull of demand is like pushing on a rope: ultimately having little impact.3 In fact, ratcheting up R&D and other technology policies in an attempt to compensate for insufficiently stringent emissions policy can dramatically raise the cost of achieving a given amount of GHG mitigation. Conversely, market demand-pull without supportive R&D policies may miss longer-term opportunities for significantly lowering GHG reduction costs and expanding opportunities for greater GHG mitigation. A coupled “emissions price plus R&D” strategy, as suggested here, offers the best opportunity for mitigating GHG emissions at the lowest possible cost to society.

The remainder of the chapter will consider each stage of the technology innovation process separately – research and development, demonstration, and deployment – elaborating on the innovation strategy proposed above, and highlighting in particular its ability to address the unique challenges and opportunities at each point of the innovation process.

Research and development

Both parts of the innovation strategy work toward the advancement of climate mitigation technology, although each targets a different part of the economy.

First part of the innovation strategy: Stimulating private sector R&D

The first part of the innovation strategy seeks to harness the power of private sector investment. Industry is central to the U.S. innovation system, performing 71 percent and funding 62 percent of total U.S. R&D (Figure 10.1). The single most important part of solving the climate technology problem is therefore to address the GHG externality through emissions pricing. The emissions price attaches a financial cost to GHGs and – just as people will consume less of something that carries a price than they will of something given away for free – will induce households and firms to buy technologies with lower GHG emissions (such as lower-emission power plants and more efficient cars and appliances). In turn, the emissions price creates a demand-driven, profit-based incentive for the private sector to invest in R&D and other innovative efforts to bring new, lower-cost, climate-friendly technologies to market. In all, the GHG price helps to stimulate progress at multiple stages of the innovative technology process: basic and applied research, development, demonstration, and deployment (Box 10.1) (demonstration and deployment to be discussed in greater detail below).

Figure 10.1U.S. R&D expenditures by funder and performer

Source: 2009 data from National Science Board (2012), Table 4–3.

Emissions pricing is not the only important tool necessary to achieve climate mitigation goals, however. Although private sector incentives for innovation are supported by intellectual property protection, secrecy, and other means, there is still a substantial portion of the benefits of innovation that cannot be captured by innovating firms, as new innovations build on existing knowledge and the benefits of new technology are passed onto consumers. This leads to a generic argument in favor of R&D tax incentives to boost the level of all (energy- and non-energy-related) private sector R&D.

Box 10.1Stages of R&D: Common Definitions

R&D. According to international guidelines for conducting R&D surveys, R&D comprises creative work “undertaken on a systematic basis to increase the stock of knowledge … and the use of this stock of knowledge to devise new applications” (OECD 2002, p. 30).

Basic research. The objective of basic research is to gain more comprehensive knowledge or understanding of the subject under study without specific applications in mind. Although basic research may not have specific applications as its goal, it can be directed in fields of present or potential interest. This is often the case with basic research performed by industry or mission-driven federal agencies.

Applied research. The objective of applied research is to gain knowledge or understanding to meet a specific, recognized need. In industry, applied research includes investigations to discover new scientific knowledge that has specific commercial objectives with respect to products, processes, or services.

Development. Development is the systematic use of the knowledge or understanding gained from research directed toward the production of useful materials, devices, systems, or methods, including the design and development of prototypes and processes.

Source: National Science Board (2008), p. 4.9.

Section 41 of the U.S. Internal Revenue Code allows taxpayers to claim credits against corporate and individual income tax for extra expenditures on research and experimentation above a defined baseline. Known informally as the “R&D tax credit,” it was originally added to the tax code in 1981 as a temporary measure. It has been renewed 14 times since then – sometimes retroactively and/or after lapses – and under current law expired on December 31, 2013, though it is expected to be renewed for 2014. Given that R&D efforts typically span multiple years, this kind of uncertainty makes long-range research planning based on tax considerations difficult. As such, encouraging increased private sector R&D by making the R&D tax credit permanent would bolster private incentives for innovation that would be induced by the emissions price, and would improve innovation incentives more generally. In recent years tax expenditures for the R&D tax credit have been in the range of $8–9 billion annually, with forward-looking estimates of about $10 billion per year to make the credit permanent.

It is difficult to pin down exactly how much and what type of innovation is likely to be generated by a GHG emissions price bolstered by the R&D tax credit, but the innovation is sure to come from a wide array of businesses currently engaged in the development and use of energy producing and consuming technologies, including:

  • Provision of electricity and transportation services.

  • Agro-biotech sector (assuming there are incentives for CO2 sequestration in forests and other biomass sinks).

  • Companies that produce and consume other non-CO2 GHGs (e.g., chemical companies).

  • Less obvious sectors such as information technologies (e.g., in the context of energy management and conservation).

Second part of the innovation strategy: Public support for strategic basic research

Although basic and applied research is critical to the innovation process, more than three-quarters of industrial R&D is instead focused on development. In contrast, universities, other nonprofits, and federal labs perform the vast majority of basic research (about 80 percent), more than half of which (approximately 53 percent) is funded by the federal government.4 Although it may have low short-term returns to individual firms, basic research can have high returns to society over the long run by building the intellectual capital that lays the groundwork for future advances in technology. In this way, universities, nonprofits, and federal labs play a complementary role to industry in the innovation system, so there is a need for policy that will supplement industrial R&D with more basic research relevant to lowering the cost of GHG mitigation and meeting other energy policy goals.

The second part of the climate innovation strategy addresses this need by proposing to gradually increase federal spending for energy R&D. But how high should federal energy R&D budgets go? While ideally one might like to optimally determine and allocate the federal R&D budget across the wide variety of funded areas – thorough detailed evaluation of the technical opportunities, cost of research efforts, likelihood of success, and ultimate economic and social payoff of research – this is not realistic and may not even be practically possible. Nonetheless, a significant expansion of well-directed energy R&D funding is warranted based on scientific opportunities for advance, plausible assumptions about the rate of return on such spending and other factors, to roughly $8 billion per year over the next several years, or roughly a 40 percent addition in energy R&D from 2012 levels. A gradual and sustained ramp-up is preferable to a dramatic spike in R&D spending due to the nature of the R&D process, which involves the training of scientists and engineers and their gradual movement into the innovation system, where they then require ongoing support. To avoid crowding out of other beneficial R&D (i.e., diverting engineers and scientists away from non-energy sectors), this funding should therefore be phased in.

Other studies have recommended substantially higher levels of R&D funding, including a 2010 study by the President’s Council on Science and Technology, or PCAST, that recommended double this amount – $12 billion for R&D and $4 billion for large-scale demonstration and deployment annually – although without a specific scale-up period. The PCAST study also recommended that the additional funds ($10–11 billion annually in their case) come from new revenue streams, such as carbon pricing, rather than traditional federal appropriations.

This funding should place a priority on strategic basic research inspired by critical needs arising from efforts to develop new and improved GHG mitigation technologies. The concept of strategic basic research emphasized here is close in spirit to Stokes’s notion of use-inspired basic research, which (unlike pure basic research) is inspired by the desire to develop improved technology, but (unlike pure applied research) also seeks to develop improved fundamental understanding (see Figure 10.2). A few examples include:

  • Direct conversion of solar energy to electricity and chemical fuels.

  • Understanding of how biological feedstocks are converted into portable fuels.

  • New generation of radiation-tolerant materials and chemical separation processes for fission applications.

  • Addressing fundamental knowledge gaps in energy storage.

Figure 10.2An alternative conception of research: “use-inspired” basic research

Source: Based on Stokes (1997).

At the same time, this funding should also invest in training the next generation of scientists and engineers. This would tend to imply prioritizing additional funding to universities and colleges, which accounted for only about 22 percent of DOE energy-related R&D funding obligations in 2009, while government laboratories represented nearly two-thirds of funding obligations in that year.5 During the past two administrations a number of innovative new R&D programs have been developed to increase the application of basic scientific research to energy problems, including the Energy Frontier Research Centers and Bioenergy Research Centers.

In order to encourage exploration of novel, emergent, or integrative concepts for addressing climate change, there should also be a program of exploratory research that pursues transformational technologies that may not fit well within existing basic or applied research programs. The Advanced Research Projects Agency-Energy, or ARPA-E, is the natural foundation on which to further build that program, where appropriate in cooperation with other key funding agencies such as the National Science Foundation, the Department of Defense, and the Department of Agriculture. ARPA-E currently includes programs in the areas of electrical energy storage, microorganisms and plants for liquid transportation fuels, and innovative materials and processes for carbon capture, to name a few.

Improved research communication, coordination, and collaboration

In the context of increased funding for strategic basic research, perhaps the most important additional recommendation is to improve processes for communication, coordination, and collaboration between the U.S. Department of Energy (DOE) and the private sector and within DOE among the basic research programs in the Office of Science, the applied energy research programs within the DOE program offices (fossil fuel, nuclear, renewables, end-use efficiency, and electricity delivery), and ARPA-E. The first Quadrennial Energy Technology Review, published in 2011, was a positive step in this direction and will require continued attention from the point of view of implementation.

In addition, the President’s Council on Science and Technology has recommended to broaden this process beyond DOE through a Quadrennial Energy Review process that would engage the many other agencies with active energy policy roles, including but not limited to the Departments of Agriculture, Commerce, Defense, Energy, Interior, Transportation, State, and Treasury, and the Environmental Protection Agency. Increased resources need to be tied to an effective strategy for managing and coordinating climate mitigation technology research to ensure these funds are employed efficiently. The PCAST study and others (see Suggestions for Further Reading) also made a number of useful recommendations for improving federal management of energy innovation, both within DOE and across the federal decision-making complex.

Inducement prizes

Finally, a portion of the proposed public funds should be used to supplement the traditional research contracts and grants structure with inducement prizes (sometimes called challenges) that provide financial rewards for achieving significant advances in climate mitigation innovation. Prizes of this type can help focus research efforts on clearly defined objectives, instill a sense of urgency and competition, and engage a broad set of innovators. In contrast to other instruments such as research contracts, grants, and R&D tax credits, prizes have the attractive incentive property of targeting and rewarding innovation outputs, rather than inputs: the prize is paid only if the objective is attained. Prizes or awards can also help to focus efforts on specific high-priority objectives, without specifying how the goal is to be accomplished.

Because prize competitors select themselves based on their own knowledge of their likelihood of success – rather than being selected in advance by a research manager – prizes can also attract a more diverse and potentially effective range of innovators from the private sector (e.g., industry or individual entrepreneurs), universities, and other research institutions. Building on recent experience gained at the federal level – including at DARPA, NASA, and the DOE – the DOE (and possibly other relevant agencies) should continue an experimental series of prizes over the next several years employing a small fraction of the additional recommended funds, with additional funds thereafter in accordance with an evaluation of the first phase. For example, in the past several years DOE has launched a number of inducement challenges including:

  • The Bright Tomorrow Lighting Prize for energy-efficient lighting;

  • SunShot prize for low-cost rooftop solar PV;

  • Apps for Vehicles Challenge to spur and highlight innovations from vehiclegenerated open data; and

  • Apps for Energy prizes for software that helps utility consumers make informed decisions.

Inducement prizes are not suited to all innovation goals, however, as they tend to require well-defined and measurable objectives that can be stated in advance.

Demonstration

Overall, public funding for precommercial research tends to receive widespread support among experts based on the significant positive spillovers typically associated with the generation of new knowledge. Agreement over the appropriate role of public policy in technology development tends to weaken, however, as one moves from support for R&D to support for large-scale demonstration projects, and to widespread commercial deployment.

Technology demonstration projects – which seek to prove the viability of new technologies at commercial scale – occupy a middle ground between R&D and deployment. Arguments for public support of technology demonstration projects tend to point to the large expense; high degree of technical, market, and regulatory risk; and inability of private firms to capture the rewards from designing and constructing first-of-a-kind facilities. Most compelling from an economic perspective, there may be knowledge generated in the process of undertaking first-of-a-kind demonstration projects – which can help improve the design of future technology, lower technical risks, and serve as a basis for well-designed regulations – but profits from this knowledge may not be appropriable by individual firms.

Conversely, caution is required because, despite good intentions, the most infamous failures in government energy R&D funding (e.g., the Synthetic Fuels Corporation, Clinch River Breeder Reactor) tend to be associated with large-scale demonstration projects – using up large portions of limited R&D budgets in the process (see Suggestions for Further Reading). The experience with the FutureGen Initiative for clean-coal power tends to reinforce this perspective, although that project is still under development.

In sum, while it should not be the focus of climate mitigation innovation investments by the public sector, there may be a compelling rationale for well-designed public support for a limited number of first-of-a-kind mitigation technology demonstration projects, so long as the purpose is the generation of substantial new knowledge (as opposed to meeting production or deployment targets).

Deployment

The first part of the innovation strategy, pricing GHG emissions through a carbon tax or market-based trading system, would provide direct, cost-effective, and technology-neutral financial incentives for the deployment of GHG-reducing technologies. Beyond GHG emissions pricing, however, there are other technology policies – divided into the broad categories of standards and subsidies – that might also be enacted to aid in the deployment of climate-related innovations. If such additional policies are pursued alongside GHG pricing, they should be targeted at addressing market problems other than emissions reductions per se – and thus can be viewed as a complement to, rather than a substitute for, an emissions pricing policy.

There are several specific market problems to which technology deployment policies could be efficiently directed, if the benefits of practicable policies were found to justify the costs in particular circumstances. These market problems include:

  • impediments to cost-effective energy-efficiency investment decisions;

  • knowledge spillovers from learning during deployment;

  • different information available to project developers versus lenders;6

  • network interactions in large integrated systems, such as with transportation fuels, vehicles, and fueling infrastructure; and

  • incomplete insurance markets for liability associated with specific technologies.7

Although market problems are often cited in justifying technology deployment policies, such policies in practice may go further in promoting particular technologies than a response to a particular market problem may require. Therefore, while conceptually sound rationales may exist for implementing these policies, in practice one must evaluate whether, as actually proposed and implemented, they would provide a cost-effective addition to market-based emissions policies. Critics point out that deployment policies intended to last only during the early stages of commercialization and deployment often create vested interests that make the policies difficult to end.

As complements to a market-based trading system, technology deployment policies will tend to lower the allowance price associated with achieving a given emission target, rather than producing additional emissions reductions below the cap. As complements to a GHG tax, such policies will tend to increase the total amount of emissions reductions achieved by a given tax.

Technology standards and subsidies. Technology standards and subsidies can be viewed as different means to achieve the same ends (such as increased energy efficiency and/or greater reliance on renewable energy, for example). Just as there are important differences between an emissions-trading program and an emissions tax, however, standards and subsidies tend to differ in terms of who bears the cost, how their impact evolves over time, and what kinds of outcomes they guarantee.

Cost distribution. Regarding distributional consequences, the cost of imposing a standard tends to fall primarily on households and firms in the regulated sector. By contrast, the cost of providing subsidies tends to fall on taxpayers more generally – unless those subsidies are funded directly by energy-related fees (e.g., electricity ratepayer surcharges). However, this distinction can also be altered somewhat through self-financing mechanisms such as “feebates” (for example, to promote improved automobile fuel economy, subsidies for efficient vehicles could be funded by fees on inefficient vehicles – see Chapter 12).

Evolution over time. Different deployment policies also have different dynamic properties. The incentives generated by standards are typically more static in the sense that industry has no reason to exceed the standard, which eventually becomes less binding as technology matures (of course, as technology improves, policymakers may also respond by raising standards). Fixed subsidy levels, on the other hand, may continue to provide incremental deployment incentives, depending on the payment structure. If the rationale for a particular deployment policy is early technology learning, however, designing technology deployment policy instruments to automatically lose their impact over time as the technology matures could very well be desirable.

Variable outcomes. Standards tend to guarantee that specific technologies will be deployed in a certain quantity (or as a minimum share of the market) or that certain performance criteria will be achieved, but leave the cost of achieving the standards uncertain. Technology subsidies, on the other hand, pin the incremental cost spent on technology to the level of the incentive and leave uncertain how much deployment (or what level of performance) will be achieved at that cost. Ceilings (and floors) on credit prices within a tradable standards system can blur these distinctions.

Designing for flexibility and efficiency. As with emission standards, the cost-effectiveness of technology-oriented standards can be increased by incorporating flexibility mechanisms such as credit trading, banking, and borrowing. Likewise, tendering or reverse auctions – whereby the government has a competitive bidding process for the provision of technology such as renewable electricity generation – can help facilitate cost competition by making subsidy recipients bid for the minimum subsidy needed to deliver a specified quantity of new technology. This approach can help reduce the cost of technology deployment over time by ensuring that a given expenditure of public resources produces the maximum amount of deployment (or conversely, that a given deployment target is achieved at the lowest possible cost to taxpayers). This is particularly true if the approaches involve a differentiated rather than uniform bid structure.

Other aspects of deployment policy. Finally, a number of other polices may be critical in helping certain GHG-reducing technologies compete effectively to potentially gain a foothold in the marketplace. The successful deployment of new technologies often requires better information and verification methods; infrastructure planning, permitting, compatibility standards, and other supporting regulatory developments; and institutional structures that facilitate technology transfer, such as rule of law, judicial or regulatory transparency, intellectual property protection, and open markets. A balance must be struck, however, between enabling technologies to compete and constructing policies that preferentially support specific technology options or systems.

Conclusion

The purpose of this chapter is to outline how a well-targeted set of climate policies, including those targeted directly at science and innovation, could help lower the overall costs of mitigation. It is important to stress, however, that poorly designed technology policy will raise rather than lower the societal costs of climate mitigation. To avoid this, government support should emphasize areas that are least likely to be undertaken by the private sector, assuming that industry will face substantial incentives in the form of a market-based price on GHG emissions. As discussed, this would tend to emphasize strategic basic and applied research that advances science in areas critical to climate mitigation. In addition to generating useful results, such funding also serves the critical function of training the next generation of scientists and engineers for future work in both the private and nonprofit sectors.

Climate technology policy must complement rather than trying to substitute for emissions pricing. On the research side, R&D without market demand for the results is like pushing on a rope and would ultimately have little impact. On the deployment side, technology-specific mandates and subsidies may have some emission reduction benefits, but will tend to generate those reductions in a relatively expensive, inefficient way relative to an economy-wide emissions price. The scale of the climate technology problem and our other energy challenges requires a solution that is as cost-effective as possible.

Notes

These issues persist despite intellectual property and other protections; refer to the section below on “Research and Development” for a more detailed discussion.

Some incentives, however, may go the other way. For example, it is possible that multiple firms competing against one another may over-invest in a single technology or set of technologies from a broader societal point of view. The sense among experts, however, is that on net positive spillover concerns dominate, leading generally to under- rather than over-investment in innovation.

In some cases, such as where existing products are made more energy-efficient (e.g., vehicle fuel efficiency improvements), demand for new technologies is generated from the prospect of fuel savings alone. Nonetheless, this demand incentive is still insufficient if fuel prices do not reflect the GHG externality.

Based on 2009 statistics from National Science Board (2012).

Statistics were calculated from data in: National Science Foundation, National Center for Science and Engineering Statistics, Federal Funds for Research and Development, FY 2009–11, Table 16. For the purposes of these statistics, “energy-related R&D” comprises Electricity Delivery and Energy Reliability, Energy Efficiency and Renewable Energy, Fossil Energy, Nuclear Energy, and the Office of Science within the U.S. Department of Energy.

Loan guarantee programs – which involve government guarantee of loans at low financing rates – may be conceptually justified if informational asymmetries exist in credit markets for relevant technologies. On the other hand, loan guarantees create implicit subsidies; as such, their benefits should justify their costs. Because loan guarantees insulate projects (at least in part) from default risk, they can incentivize developers to take on riskier projects while doing less than they should to guard against preventable risks.

There may be a rationale for establishing a joint insurance pool or limiting liability for certain technologies like carbon storage if there is insufficient availability of private liability insurance or there are substantial potential difficulties in assigning liability. On the other hand, liability protection provides a form of implicit subsidy by insulating parties from potential damages caused by their technologies. Thus, if designed poorly they may reduce incentives for those parties to take appropriate actions to mitigate risks where possible.

References and suggestions for further reading

    Henderson, R. H. and R. G.Newell.2011. Introduction and Summary. In Accelerating Energy Innovation: Insights from Multiple Sectors. Edited by R. H.Henderson and R. G.Newell. Chicago: University of Chicago Press for the National Bureau of Economic Research, 124.

    National Science Board. 2008. Science and Engineering Indicators. Arlington, VA: National Science Foundation.

    National Science Board. 2012. Science and Engineering Indicators 2012. Arlington VA: National Science Foundation (NSB 12–01).

    Newell, Richard G.2007a. Climate Technology Research, Development, and Demonstration: Funding Sources, Institutions, and Instruments. Issue Brief 9 in Assessing U.S. Climate Policy Options, ed. Raymond J.Kopp and William A.Pizer. Washington, DC: Resources for the Future.

    Newell, Richard G.2007b. Climate Technology Deployment Policy. Issue Brief 10 in Assessing U.S. Climate Policy Options, ed. Raymond J.Kopp and William A.Pizer. Washington, DC: Resources for the Future.

    Newell, Richard G.2008. A U.S. Innovation Strategy for Climate Change Mitigation. Washington, DC: The Hamilton Project (Brookings Institution).

    Newell, R. G.2009. International Climate Technology Strategies. In Post-Kyoto International Climate Policy: Implementing Architectures for Agreement. Edited by J. E.Aldy and R. N.Stavins. Cambridge: Cambridge University Press, 403438.

    Newell, R. G.2011. The Energy Innovation System: A Historical Perspective. In Accelerating Energy Innovation: Insights from Multiple Sectors. Edited by R. H.Henderson and R. G.Newell. Chicago: University of Chicago Press for the National Bureau of Economic Research, 2548.

    Newell, R. G. and N. E.Wilson.2005. Technology Prizes for Climate Change Mitigation. RFF Discussion Paper 05–33. Washington, DC: Resources for the Future.

    Organisation for Economic Co-operation and Development (OECD). 2002. Proposed Standard Practice for Surveys on Research and Experimental Development (Frascati Manual). Paris: OECD.

    President’s Council of Advisors on Science and Technology (PCAST). 2010. Report to the President on Accelerating the Pace of Change in Energy Technologies through an Integrated Federal Energy Policy. Washington, DC: Executive Office of the President.

    Stokes, Donald E.1997. Pasteur’s Quadrant: Basic Science and Technological Innovation. Washington, DC: Brookings Institution Press.

    U.S. Department of Energy (DOE). 2011. Quadrennial Technology Review 2011. Washington, DC: DOE.

    U.S. Department of the Treasury. 2011. Investing in U.S. Competitiveness: The Benefits of Enhancing the Research and Experimentation (R&E) Tax Credit. A Report from the Office of Tax Policy, March25, 2011.

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