Alternative Energy/Mitigating Climate Change Through Technology Transfer
Barton, J., 2008a. Mitigating Climate Change Through Technology Transfer: Addressing the needs of Developing Countries, Chatham House. Barton, 2008a - The paper outlines the economic and policy challenges of meeting the emissions reduction targets of the UNFCCC through technology development and dissemination in developed and developing countries. He focuses on renewable electricity sources, carbon capture and storage and other mitigation technologies, biofuels, industrial efficiency, consumer conservation, and nuclear energy, and outlines the emissions reduction potentials, the modes of encouragement for the technologies, and the special issues in international technology transfer. Barton makes three points about the process that will be undertaken to disseminate these technologies. First, the financial heart of technology diffusion with be physical investment in the form of subsidies or regulatory incentives. Second, public-sector support for research & development is important. Third, his examples imply that the costs specifically assignable to technology will be very small when compared with the overall capital and investment costs. The general conclusion of the paper is that due to the competition between renewable technologies, and the competition in the electricity, fuel, automobile, and housing efficiency markets, the greatest cost for carbon-emission technology is on the manufacturing and capital cost side, whereas R&D is only a small portion of overall cost, resulting in very little mark-up for the cost of these technologies. The result is a mark-up of only 0.20 on the manufacturing cost of a Vestas wind turbine. This leads to low royalties - on the order of 1% of the sales price for wind turbines. Due to this there is very little wiggle room for differential pricing between the developed world and the developing world, which means that compulsory licensing is unlikely to be an effective way to disseminate the carbon abatement technologies in developing countries since there will be very little financial benefit.