The Greening of Innovation Policy Continues

Fresh after the announcement of Climate Ready and other "green" announcements in the 2008 Budget, it looks like we may be going further in that direction as a nation.

It's hard not to have noticed that the Garnaut Draft Report is now online. Professor Joshua Gans, writing in The Age has identified that the Government will need to allocate more than $3 billion a year for innovation on low-emissions technologies.

He puts this in perspective by referencing the $1 billion Backing Australia's Ability program by the former Howard Government. A further point is the $500 million on the Low Emissions Technology Demonstration Fund, which was for projects to demonstrate breakthrough technologies with significant long-term greenhouse gas reduction potential in the energy sector.

Ideally, those technologies would have had to demonstrate a reduction of greenhouse gas emissions by about 2% per annum with reasonable uptake after 2030.

It will be interesting to see how this feeds into the Cutler Innovation Review, which has its own green paper due out on 31 July. The detail of the delivery, be it tax concessions (deductions or credits), grants, other government regulatory relief, will be interesting.

Of course, there's a real possibilty (even a probability) that the additional investment in low-emissions technology will lead to a related productivity boost for the economy.