The cost of existing environment-friendly technologies, such as wind turbines and SO2 scrubbers, needs to be brought down so that they can be deployed on a large scale, while fundamental research needs to advance on the frontiers of technologies such as smart grids or energy storage.
Yet, despite these pressing challenges, European companies in the electricity production sector – the largest greenhouse gas emissions emitter in Europe, with 33% of European emissions in 2012 – spend less than 1% of their turnover on innovation, against 10-15% in IT or pharmaceuticals, suggesting that the incentives to conduct Research, Development and Demonstration (RD&D) of new or enhanced low carbon technologies and their associated systems and processes might not be in place.
The objective of this policy note is to investigate whether the current level of public support to environment-friendly technologies is sufficient to allow European countries to respond to the multiple challenges posed by climate change and other environmental concerns and to discuss the policy interventions that might be needed in order to drive forward clean energy technology investments in Europe.