Business Weekly - Cambridge, UK

They show that the net cost of climate change mitigation technologies depends crucially on the extent to which policy measures can reduce and stimulate innovation to reduce the costs of new technology.

“Despite denying the science of global warming and the Kyoto Protocol, George Bush is right that significant policies to stimulate innovation for low carbon technologies must begin now,” says Dr Jonathan Kohler, a Cambridge and Tyndall Centre economist.

In 2002, George Bush set-aside $1 billion for research and development of clean energy technologies and a further $4.6 billion for clean energy incentives in his ‘Clear Skies and Global Climate Change Initiatives’ announcement.

The Tyndall Centre res-earch is a significant departure to the traditionalist cost-benefit analysis of environmental problems, and recognises that current technologies and costs are a poor guide to the energy technologies of the future.

The thinking behind this work is that market econ-omies are better characterised by successive waves of new clusters of technologies which in turn change the economic structures of production and consumption.

For example, the current wave of IT continues to change the way that the global economy works.

And to answer the ‘how much cost?’ question last, their answer is in between 0-2 per cent of world GDP by 2050.

This is equivalent to delaying reaching the global economic output of 2050 to a year later in 2051. By this time, GDP is likely to have risen by two to three hundred per cent in most economies.

The Tyndall Briefing Paper, ‘New Lessons for Technology Policy and Climate Change Investment for Innovation: a briefing document for policymakers’ is at www.tyndall.ac.uk/publications/briefing_notes/note13.pdf