IP in the energy transition: An obstacle or a facilitator?

The Director of the US Patent and Trade Mark Office, Kathi Vidal, has described how important the US system of patent protection is to the development of a clean-energy future in an address to the ARPA-E Energy Innovation Summit (see the full address here). Ms Vidal wants the patent system to "power the new technologies aimed at the reduction of greenhouse gas emissions". With this in mind, the USPTO has introduced a Climate Change Mitigation Pilot Program to provide a fast-track review of patent applications that cover a product or process that mitigates climate change.

This address is in contrast to recent comments made by the UN Secretary-General that "removing obstacles to knowledge sharing and technological transfer – including intellectual property constraints – is crucial for a rapid and fair renewable energy transition" and that "renewable energy technologies…must be treated as essential and freely-available global public goods" (see our report on this here).  So, is IP an obstacle to the transition or an essential facilitator?

Ms Vidal noted that IP can be "the primary vehicle used by our universities, our government labs, our big companies, and our startups, and our individuals to turn new inventions and technologies into commercial products and entirely new industries". IP can be crucial for companies carrying out the R&D necessary to develop new technologies that are essential to facilitate the energy transition. IP, for example in the form of a patent, is an asset that can be leveraged to recoup investment, and to access capital for the R&D and subsequent commercialisation of new technologies. Many companies seem to be taking this approach – for example, Ms Vidal noted in her address that the US Patent Tech Centre that focuses on green technologies received 40,000 patent applications last year. Having said that, the exercise of IP rights in green technologies is likely to require more nuance than rights in other areas. Industry players will need to consider carefully how best to ensure both return on investment and dissemination of their technologies, including to combat climate change in countries which could not otherwise afford it.

IP is a strategic issue in the development of green technologies that should be on the radar of all those involved in the on-going push for low-carbon technologies. And an all or nothing approach is unlikely to be the answer.  If IP is not proactively considered as part of innovation strategy in this space, not only may investors and developers lose out but, ultimately, society as a whole will, if potentially beneficial technologies cannot advance or, once advanced, be disseminated.  Accelerating, encouraging and enabling innovation is critical for an effective, long-term global response to climate change and promoting economic growth and sustainable development.

For thoughts on what the energy sector can learn from pharma in this respect, see our article here.