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Democracies Take the Lead in Partnering on Energy Innovation

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Last week, I attended a high-level CEO dialogue at the U.S.-India Energy Partnership Summit, organized by Yale and The Energy and Resources Institute (TERI)-North America. The dialogue, held in Washington, D.C., explored how businesses can accelerate the development and adoption of green technology and how the United States and India are at the forefront of collaboration to promote clean energy.

U.S. leaders present included Yale's president, Dr. Richard C. Levin, the Deputy Secretary of Energy Dan B. Poneman, Assistant to the President for Science and Technology Dr. John P. Holden, and Senator Tom Udall (D-NM). Leaders from India included the president of TERI-North America, Dr. Rajendra K. Pachauri; the Indian Ambassador to the U.S., Her Excellency Ms. Nirupama Rao; the Indian government's principal scientific advisor, Dr. Rajagopala Chidambaram; and the chair and director of PTC India Ltd., Mr. Tantra Narayan Thakur.

The U.S.-India partnership offers a paradigm for how advanced countries can help developing countries surmount the financial constraints standing in the way of green research and development and the production and distribution of green energy technology. Deputy Secretary of Energy Poneman characterized the U.S.-India relationship on energy and environmental issues as a vibrant and even breathtaking one. The two countries share values and interests, he noted. They also happen to be the first and third largest emitters of carbon dioxide; therefore, they have a common responsibility to serve as stewards for the planet.

Yale has played a key role in mobilizing intellectual capital at universities in the service of exploring alternative energy sources, including wind, solar, biomass, shale gas, and nuclear, as well as cleaner and more efficient methods of extracting and using energy -- from carbon capture and sequestration to a smarter grid.

TERI in Delhi is, meanwhile, challenging assumptions about what kind of progress is possible in the developing world through its Lighting a Billion Lives campaign, helping rural Indians gain access to clean and reliable energy. 1.4 billion people, 400 million of whom live in India, lack access to electricity and rely on older technologies, like kerosene lamps, to cook, work, and study when night falls. These lamps are not only inefficient, they also produce smoke that contributes to indoor air pollution and present a fire hazard.

TERI is working to enable Indians to use lamps powered by solar energy. These lamps are safer, more reliable, and more efficient. The introduction of this new technology has also helped more women to become entrepreneurs by enabling them to work at solar lamp-charging stations and rent solar lamps out.

Academia and NGOs are, clearly, doing their part. But both the private sector and the government also have critical and indispensable roles to play in the development of clean energy technology. The private sector has the knowledge needed to develop the most appropriate technology for addressing a given problem. It is also driven by the profit motive, which helps ensure that new technology is as efficient as possible. The government, on the other hand, must fund basic research, which is critical to innovation, but which the private sector chronically under-invests in because gains from basic research generally cannot be captured by one firm and instead are distributed industry-wide. The government should also design the policy environment with an eye towards promoting innovation. If policy space places a premium on energy efficiency, innovation will develop in a direction that favors clean technology.

There are many areas in which government needs to step up to the plate. There are still barriers to sharing technology and ideas, including the difficulty that foreign scientists can have in securing visas as well as inadequate funding for basic research. Government should also create a level playing field for all types of energy: alternative energy sources must be priced so that they can compete with traditionally cheaper fossil fuels.

It is impressive and inspiring to see the two largest democracies in the world take the lead on clean energy innovation and climate change science. Hopefully, the U.S.-India partnership can serve as the cornerstone of a coordinated, global effort to address the most important energy and environmental challenges that the world faces.

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