Alternative Energy/Intellectual Property and Access to Clean Energy Technologies in Developing Countries
Barton, J., 2007. Intellectual Property and Access to Clean Energy Technologies in Developing Countries: An analysis of Solar Photovoltaic, Biofuel and Wind Technologies, International Centre for Trade and Sustainable Development . Available at: zotero://attachment/13516/ [Accessed May 15, 2009]. Barton, 2007 - The paper discusses the role IP plays in climate change mitigation technology transfer from developed countries to developing countries with a focus on China, India and Brazil, and solar, wind and bio-mass technologies. Using the pharmaceutical industry for comparison - while clearly noting that the alternative energy sector differs dramatically from this sector which is the de facto comparison on IP issues for developing countries - Barton points out that many of the products that are put on the market in the pharma sector may not have substitutes, which gives them a very strong monopoly and the ability to mark up the product for a large royalty profit. Alternative energy technologies typically have patented improvements or features while the basic technology is typically off-patent, and the cost of producing the units is quite high in comparison to the costs of reproducing many pharma products. The competition between different improvement patents of the alternative energy technologies reduces the overall costs and reduces the expected royalty income. In addition, competition between the wind, solar and bio-fuel industries for market share, drops the royalty incomes even more. There are different issues observed in each of the three technologies. The wind market tends to be quite consolidated with the four top companies controlling 75% of the market. IP issues are not expected to be a big issue here due to the easy access to the technology, though there may be future issues with cartel behavior. Developing countries like China and India have been successful in gaining a foothold in the wind market by buying developed nation firms and acquiring their patents. The PV industry suffers from a difficult market existence due to the high cost of the technology. The market is somewhat consolidated, though there are numerous companies that manufacture various parts of the PV installation, which breeds a high level of competition. Thin film technologies may create a bigger IP barrier for developing nations due to the advanced nature of the technology, and the developed nation control over these technologies at the current time. The Biomass industry does not currently suffer from any IP barriers, but the promise of cellulosic ethanol, could create a battle over patents for the enzymes that will break down the lignin for sugar. The biggest barrier in this sector will probably be trade tariffs like the US tariff on Brazilian ethanol.