Why Innovation Alone Isn’t Enough to Win the Climate Fight

After the failure of cap and trade, many climate advocates have focused on energy innovation as a way to sidestep tough politics. But there's avoiding the battle over climate change

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Ken Welsh

Politics can be frustrating. Actually, it’s more like politics ARE frustrating, especially in America and especially in 2013, where a constitutional system designed for maximum gridlock has met intense partisanship fed by the nano-second news cycle of social media. Right now the government of the United States seems wholly incapable of getting out of a self-designed trap to needlessly slash billions of dollars in spending and cut hundreds of thousands of jobs at a moment when the American economy is beginning to pick itself off the floor. (You may know this as sequestration.) And this comes just a few months after we nearly tipped over the fiscal cliff, which at least had a much snazzier name than sequestration. Meanwhile the nominated Secretary of Defense floats in limbo at a moment when the world is, well, pretty unstable, all because a few senators are in a snit. Political dysfunction forms the backdrop of our days.

What does this mean for climate policy? Well, if the government can’t get itself together to deal with the much more immediate threats of sequestration, properly responding to a long-term and highly complex challenge like climate change has basically entered the realm fantasy. This is especially true when one of two political parties refuses to acknowledge the problem exists. There was a chance in 2009 and 2010 with comprehensive climate legislation, but that died for countless reasons. And while there are executive actions or EPA regulations that could begin to address carbon emissions, we really need more ambitious legislation. And that simply seems impossible.

So it shouldn’t be surprising that in the wake of cap-and-trade’s death a few years ago, some climate advocates began to plot another line of attack, one that wouldn’t break the political deadlock so much as sidestep it altogether. It’s energy innovation—policy, to put it simply, that focuses on making clean energy cheap, rather than making dirty energy expensive through a carbon cap or regulations. You don’t have to worry about trying to outflank the coal industry or convince that Midwestern Democratic senator that he won’t lose his seat if he votes for carbon pricing. Instead, by spending significantly more public money on energy research and subsidizing clean power, you’ll be able to achieve carbon cuts—and build a new clean energy economy—without engaging much in politics at all.

There’s a certain subset of energy wonks—I’d include myself in that category, except that I hate the term wonk—who seem naturally disposed to innovation policy. This is especially true if you live in New York or San Francisco, and if you prefer to don a gas mask whenever you deign to visit Washington. But while there’s a lot about innovation policy to like—and I’ve definitely covered it favorably on this blog—it’s not perfect, and it’s likely not enough alone to solve climate change. And most of all, innovation policy is political, as much as we might wish otherwise.

That’s the conclusion of Michael Levi’s new essay (PDF) in Issues in Science and Technology on the “Hidden Risks of Energy Innovation.” Levi, who directs the program on energy security and climate change at the Council on Foreign Relations, punctures a hole in the illusion that innovation policy is certain to succeed where carbon pricing failed. Instead of sidestepping political fights, innovation policy will create new ones:

Alas, the turn from regulation to innovation is not a magic recipe for eliminating conflict over domestic or international policy, or even for significantly reducing it. Instead, it will create new fights in new spheres. This is not a reason to reject a big technology push as part of a serious climate strategy; climate change needs to be confronted, and conflict is almost certainly endemic to serious climate policy. Nonetheless, before policymakers place their bets on technology policy, they would do well to better understand the opportunities for conflict that lurk there. If they do, they will realize the limits of technology policy and will more likely pursue a modest but constructive approach. If they do not, the more likely outcome is a drive that tries to do too much with technology policy. But just like the maximalist efforts to solve every climate problem with cap-and-trade and an international treaty, that overstretch is likely to beget failure.

The problem is politics. Americans don’t like regulation—usually—but they’re also not that fond of significant new government spending, especially now. And, as Levi notes, “without new taxes, spending, or regulation, government has no significant tools with which to promote clean energy innovation.” Whether you’re forcing emissions cuts through carbon pricing or using subsidies to force down the price of clean energy, you need to divide up a limited pie. And that means a political fight.

Levi isn’t arguing that energy innovation policy is a waste, or that we should simply go back to focusing only on carbon pricing. He’d like a technology strategy that is “robust yet restrained in its ambitions.” That means investment in very basic energy research, as well as support for more cutting-edge technologies, while avoiding big subsidies for mature technologies. An agency jumpstarted by the Obama Administration—the Advanced Research Projects Agency-Energy (ARPA-E) is the perfect vehicle for that kind of funding. (I’ll be attending the ARPA-E conference in Washington this week.) That will look different than the tends of billions of dollars that were spent on clean energy during Obama’s 2009 stimulus, but the point then was to jump start a depressed economy—and as a side benefit, to do so while helping out clean technology. But that’s not politically viable for the long term.

This sort of humble climate and energy policy makes sense to me, but it’s likely too little, too late for those who view climate change as an existential threat. But there’s a practical benefit to taking it easy:

When faced with a massive problem, people naturally grasp for an all encompassing solution that promises salvation. Yet such schemes invariably reveal themselves to be mirages, and overwrought efforts to realize them too often backfire. Wiser policy will involve modest moves forward on multiple fronts, including technology. It would be tragic if policymakers chose a different course and replaced one overburdened climate strategy with another.

And don’t worry—there will be political battles to fight even with a relatively scale down climate and energy strategy. But this is one environmentalists might just have a better chance of winning.