Patenting And Access To Clean Energy Technologies In Developing Countries

In the politically-sensitive pharmaceutical sector, patents often have a substantial impact on price, as there may be no substitutes for a new product. In contrast, in the renewable energy sectors considered in this article, the basic technological solutions have long been off-patent. Usually, only specific improvements or features are patented. Thus, a number of competing patented products exist - and as a result of the competition, prices are usually brought down as compared to the royalties and the price increases that would be charged under a monopoly.

In addition, there is competition not only between firms within a specific renewables sector, but also between the sectors and alternate sources of fuel or electricity. As a result, much of the benefit of the technologies is shared with the ultimate customers.

Another characteristic of the photovoltaic (PV), biomass and wind sectors is that some of the renewable energy technologies, particularly PV technologies, are not yet inexpensive enough to compete without some form of subsidy or regulation (such as a feed-in law requiring that a portion of the electricity on a grid be supplied from renewable sources). Moreover, firms have been hesitant to invest in substantial research on their own, except in areas with significant subsidies - as seen in the current ethanol boom in the U.S. Hence, much of the research in these areas is funded by the government. At least in the U.S., the subsidised research will almost certainly end up protected by patent rights. When the research is licensed, a certain amount of favouritism is, by law, to be shown to U.S. manufacturers.

Renewable energy markets

There are three types of markets for renewable energy capabilities for developing nations. The most obvious one is the market for enabling the nation itself to reduce its CO 2 emissions (not currently required by international law, but possibly required in the future). The second is the market for providing carbon offsets under the clean development mechanism (CDM) under the Kyoto Protocol. Both these markets can be served by importing products incorporating the technology, e.g. photovoltaic panels for off-grid electrical supply.

The third type of market is for renewable products, such as biofuel (or conceivably...