29th jul, 2011

Where will green innovation come from??

In a research paper from 2009 three researchers warned about stagnating innovation in green tech. I have previously posted claims that green tech is out performing basic utility innovation. However it seems like green innovation isn´t doing perfect either.
In their paper “Cold start for the green innovation machine” the authors show a number of disturbing trends in green innovation.
·         The percentage of worldwide patent applications in the field of green tech is 2 %, which is surprisingly low
·         It is hard for companies to make money from green innovation. The average R&D to sales is only 1,3% for EU companies compared to the average of 3,7 % for other technologies.
·         Implementation of new technologies is slower for green tech than other areas. Green companies cite a low demand for innovative products as a driver for this development.
·         The greatest benefits from green innovation seem to be public rather than private – and therefore companies are reluctant to invest in green innovation.
·         Uncertain market conditions is not helping investments
The rather bleak conclusion is that despite the size of the climate challenge and the need for investments in innovation the outlook for innovation is not good.
Am I being a pessimist here? This is my third or fourth post criticizing green innovation. However initiatives must be fostered to increase innovation. One approach could be to encourage the historically public owned energy and utility companies in Europe to participate and invest in innovation. The knowledge I see in publicly owned companies could easily be turned into good business ideas with an environmental effect as well.

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