Who will pay for a global climate-technology revolution?
Qil ai Shen/Panos Pictures
In his January State of the Union adthe same meeting. Detchon directs The proposal “is a major landdress, President Bush called for a climate and energy programs at the mark in addressing global warmworldwide fund to jump-start cleanUN Foundation, a public charity that ing,” said Philip E. Clapp of the energy projects in fast-growing supports UN efforts. Pew Environment Group. “Still, $2 economies like China and India. The Bush’s proposed clean-technolbillion is a very small amount of U.S. would chip in $2 billion over ogy fund would pay for low-carbon money given the scale of the probthe next 3 years and seek additional technologies like renewable energy lem. China alone is investing more funds from other nations. But some and emissions controls in emerging than $100 billion a year through its experts say this proposal is just the economies such as China and India. state-owned enterprises in new enlatest example of misguided think“The idea of the fund is to bridge the ergy projects and resources, mostly ing about what counin oil and coal-fired tries should do to make electricity. The presisure China and India dent’s proposed fund develop on a low-carmust be accompanied bon diet. by a strong new cliThe U.S. and othmate treaty to direct er industrial nations global business investpumped out most of the ment into clean-energy greenhouse gases now technologies.” in the atmosphere, but “You need to think new emissions will be big,” adds Christian coming mostly from Egenhofer, a senior redeveloping countries search fellow at the by 2030, according to Centre for European the International EnPolicy Studies. “To meet ergy Agency. China is a 2 °C target, fossil fuel building two new coalconsumption needs to fired power plants every peak no later than 2020, week and has ramped so there’s very little up its CO2 emissions by Pedal power, diesel power, and wind power—India’s old and new enertime.” Cutting 1 billion 80% since 1990—a grim gy supplies cross paths outside the Muppandal wind farm, one of Asia’s tons of CO2 per year, he largest. prospect when many notes, requires installscientists say global ing about 40 times the emissions need to drop 80% over the gap between the technology that is current wind power capacity or renext 40 years. currently being deployed in many of placing 1 billion gas-powered cars “We won’t make it if we don’t these countries, which is often not with hydrogen-powered ones. And to have a technology revolution equivstate-of-the-art, and the cleanest keep global temperature rise below alent to the space program,” said technology,” says David McCormick, 3 °C (too high, many say) means cutRichard Benedick at a recent conferundersecretary of the U.S. Departting 22 times that much CO2 per year ence held by the National Council ment of the Treasury, who first ancompared with a business-as-usual for Science and the Environment, of nounced the plan in January. That approach. which Benedick is president. To start funding gap is at least $30 billion per Yet the whole idea that rich nathis new clean-tech race, the world year, the World Bank estimates. The tions need to transfer technology to should double R&D spending to $20 fund would finance only technolopoor nations is “obsolete and combillion a year, said Reid Detchon at gies that are commercially available, pletely misleading” when it comes McCormick says, and is not intended to climate change, says Egenhofer. to help bring new products or tech“With the Montreal Protocol [for Climate Watch is an ongoing nologies, such as carbon capture ozone], we had a limited number of analysis of the latest news about and storage (CCS), to market. Its totechnologies—you just needed to the science, politics, and policy of tal size, contributors, and manageship them and finance the transfer, global climate change. ment remain to be negotiated. and the job was done. For climate © 2008 American Chemical Society
March 15, 2008 / Environmental Science & Technology ■ 1819
change, there is no single technology,” he says. Instead, a range of cooperative agreements is needed to foster a proliferation of clean tech.
Arguing over who owes what In the past, the U.S. has been a roadblock to international deals that would spread clean technology to developing countries, arguing that intellectual property rights are at stake. The new U.S. fund bypasses the ongoing UN negotiations by going through Bush’s Major Economies Meetings, which aim for voluntary emissions cuts. At the recent UN climate meeting in Bali, China’s delegation pushed for industrialized nations to share more clean technology, calling progress so far “puny”. China proposed a fund that industrialized nations would pay into and developing nations would draw from to buy patent rights or start clean-energy projects. Developed nations have an ethical obligation to help poorer nations follow a cleaner path, said leaders such as UN secretary-general Ban Kimoon at the Bali meeting. In response, the U.S. said flat-out that it would not give away technology. “The idea that governments are going to pay countries for intellectual property is not something that we would support. Nor do I think many developed countries would support that,” said senior negotiator Harlan Watson when asked at the Bali conference about a technology fund. Now, such a fund is back on the table—but on the Bush Administration’s terms. The proposed fund is not an about-face on the U.S. position in Bali, says Undersecretary McCormick, because it would not transfer, or share, any intellectual property “in ways that would allow others to use that technology to develop their own industry and build it themselves.” For example, China could tap the fund to pay for the difference between the cheapest possible coal plant and an upgraded plant, perhaps by paying a U.S. company to install better emissions controls or improve efficiency. But they would not gain the know-how, or the right, to build cleaner plants themselves using that information. In the past, the U.S. has balked at sending technology to China because of China’s reputation for reverse-engineering devices—figuring out how they
work and manufacturing knockoffs, which can render the intellectual property worthless. The Bush proposal was praised as a “Marshall Plan” on climate change by Yvo de Boer, head of the UN Framework Convention on Climate Change, referring to the massive effort to rebuild Europe after World War II. But others are more skeptical that the fund will materialize in a waning administration or do what it promises. “It’s very cumbersome and not a very efficient approach” to set up complex funds, says economist John Reilly of the Massachusetts Institute of Technology, who develops models of future emissions-cuts scenarios. China and India have large, fast-growing economies, he says, and could potentially invest in their own clean technology. To be most effective, he suggests, the fund should be presented as an incentive for developing countries that agree to binding emissions targets, which would stimulate investment. Some environmental and development groups are also wary of U.S. motives. The Bush Administration is trying to shift technology funds and “anything of substance” out of the UN process and into its own voluntary Major Economies Meetings, says Meena Raman of Friends of the Earth International. “The rich countries are using their existing obligations as bargaining chips to push developing countries to discuss future emissions cuts,” she said in Bali. “This is outrageous. Wealthy nations—which have benefited most from pollution—must take the lead by first fulfilling their responsibilities.” Also, what any fund can achieve alone is limited. “There are barriers that are not financial,” says Walter Vergara, a World Bank expert on climate change in Latin America. In developing countries in that region, he says, “there is a significant need to fill in terms of information” on the impacts of climate change and what approaches would work best. “And in addition to institutional and regulatory barriers, there’s inertia in [energy] sectors—the power sector is used to using oil or natural gas,” he adds, not wind or solar. Some developing and emerging economies also have their own national interests that can get in the way of clean technologies. Brazil,
1820 ■ Environmental Science & Technology / March 15, 2008
for one, fought hard in Bali against efforts to advance CCS technology by granting carbon credits to CCS under the UN’s Clean Development Mechanism. Such a move could cut into Brazil’s market for ethanol credits. Just a few days before the start of the Bali meeting, the U.S. joined the EU in proposing to drop all tariffs on climate-friendly goods within the World Trade Organization to promote their spread. The deal would include 43 products, such as wind turbines and solar panels, but Brazil strongly opposes lifting these tariffs unless its ethanol is included on the list. The U.S. corn lobby, however, has pushed hard to continue caneethanol tariffs.
Taking matters into their own hands In the end, negotiators in Bali agreed in principle to kick-start technology cooperation without laying out many details. An expert group on technology transfer will be reconstituted for another 5 years, and more meetings and workshops will be scheduled. But while developed countries negotiate, private industry and developing countries seem to be charging ahead on their own. Four technology companies and the World Business Council for Sustainable Development announced in January the Eco-Patent Commons, which will offer the rights to environment-friendly technologies for free. So far, major companies, such as IBM, have donated 31 patents to the public domain. “The fact is, developing countries are also important sources of new climate-friendly technologies,” says Thomas Brewer, a business professor at Georgetown University. “They are sometimes at the leading edge and have world-class R&D and manufacturing processes,” he adds. “China makes a very good and cheap compact fluorescent lightbulb. Brazil makes very cost-effective ethanol. Mexico makes solar hot-water heaters. Those are technologies that could be transferred to developing or developed countries.” As for China and India, on the same day the Bush fund was proposed, they announced their own plans to battle climate change with a new technology agreement—with each other. —ERIKA ENGELHAUPT
