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The Determinants of Invention in Electricity Generation Technologies: A Patent Data Analysis

Author

Listed:
  • Elisa Lanzi

    (OECD)

  • Ivan Haščič

    (OECD)

  • Nick Johnstone

    (OECD)

Abstract

This paper analyses the determinants of invention in efficiency-enhancing electricity generation technologies that have the potential to facilitate climate change mitigation efforts, including fossil fuelbased technologies aimed at reducing carbon emissions, renewables and nuclear technologies. The evolution of inventive activity in these technologies is analysed by considering patent data for 11 OECD countries over the period 1978-2008. The analysis considers various drivers of inventive activity, including R&D expenditures and electricity consumption, but pay particular attention to the role of fossil fuel prices because they suggest the impact that price mechanisms such as emissions trading and carbon taxes are likely to have on invention in the electricity generation sector. The results show that the effect of fossil fuel prices varies according to the different types of technologies. As fossil fuel prices increase, inventive activity in renewable energy technologies increases while the effect of on fossil fuel-based technologies is positive but with decreasing increments. The results show that there is no effect of fossil fuel prices on patenting activity in nuclear energy technologies. These results illustrate that there may be a price-induced switching between renewable and fossil fuel-based technologies. As fossil fuel prices rise, an efficiency effect encourages inventive activity in both fossil fuelbased and renewable technologies. As fossil fuel prices increase further, invention in fossil fuel-based technologies starts declining suggesting that a substitution effect drives away innovation from fossil fuelbased towards renewable energy technologies.

Suggested Citation

  • Elisa Lanzi & Ivan Haščič & Nick Johnstone, 2012. "The Determinants of Invention in Electricity Generation Technologies: A Patent Data Analysis," OECD Environment Working Papers 45, OECD Publishing.
    • Handle: RePEc:oec:envaaa:45-en
    DOI: 10.1787/5k92v111shjc-en
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    Citations

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    Cited by:

    1. Lazkano, Itziar & Pham, Linh, 2016. "Do Fossil fuel Taxes Promote Innovation in Renewable Electricity Generation?," Discussion Paper Series in Economics 16/2016, Norwegian School of Economics, Department of Economics.
    2. Herrmann, J.K. & Savin, I., 2017. "Optimal policy identification: Insights from the German electricity market," Technological Forecasting and Social Change, Elsevier, vol. 122(C), pages 71-90.
    3. Paulo Vitor Levate & Eduardo Gonçalves & Juliana Gonçalves Taveira, 2021. "Regional drivers of green inventions in OECD countries," Letters in Spatial and Resource Sciences, Springer, vol. 14(3), pages 335-354, December.
    4. Joelle Noailly & Victoria Shestalova, 2013. "Knowledge Spillovers from Renewable energy Technologies, Lessons from patent citations," CIES Research Paper series 22-2013, Centre for International Environmental Studies, The Graduate Institute.
    5. Joëlle Noailly & Victoria Shestalova, 2013. "Knowledge spillovers from renewable energy technologies, Lessons from patent citations," CPB Discussion Paper 262, CPB Netherlands Bureau for Economic Policy Analysis.
    6. Rob Aalbers & Victoria Shestalova & Viktoria Kocsis, 2012. "Innovation policy for directing technical change in the power sector," CPB Discussion Paper 223, CPB Netherlands Bureau for Economic Policy Analysis.
    7. Baek, Chulwoo & Jung, Euy-Young & Lee, Jeong-Dong, 2014. "Effects of regulation and economic environment on the electricity industry׳s competitiveness: A study based on OECD countries," Energy Policy, Elsevier, vol. 72(C), pages 120-128.
    8. Aalbers, Rob & Shestalova, Victoria & Kocsis, Viktória, 2013. "Innovation policy for directing technical change in the power sector," Energy Policy, Elsevier, vol. 63(C), pages 1240-1250.

    More about this item

    Keywords

    climate change; energy; innovation; patents;
    All these keywords.

    JEL classification:

    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation

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