2.7.1 Technology and climate change

Recognizing the importance of technology over the long-term introduces an important element of uncertainty into the climate change debate, as direction and pace of future technological change cannot be predicted. Technological innovation and deployment are responsive to climate policy signals, for example in form of carbon taxes, although the extent and rate of this response can be as uncertain as the timing and magnitude of the policy signal. Reducing such uncertainties, for instance through long-term, predictable policy frameworks and signals, are therefore important. The usual approach consists of formulating alternative scenarios of plausible future developments. These, however, are constrained by inherent biases in technology assessment and uncertainties concerning the response of technological change to climate policy. There is also widespread recognition in the literature that it is highly unlikely that a single ‘silver bullet’ technology exists that can solve the climate problem, so the issue is not one of identifying singular technologies, but rather ensembles, or portfolios of technologies. This applies to both mitigation and adaptation technologies. These technologies have inter-dependencies and cross-enhancement (‘spillover’) potentials, which adds another important element of uncertainty into the analysis. Despite these problems of uncertainty and ignorance, insights are available from multiple fields.

Extensive literature surveys on the importance of technological change on the extent of possible climate change and on feasibility and costs of climate policies are provided by Clarke and Weyant (2002), Grubb et al. (2002), Grübler et al. (1999), Jaffe et al. (2003) and Löschel (2002) among others. Quantitative illustrations have been published in a number of important scenario studies including the IPCC SAR (IPCC, 1996) and SRES (IPCC, 2000), the scenarios of the World Energy Council (WEC, Nakicenovic et al., 1998a) as well as from climate policy model inter-comparison projects such as EMF-19 (Energy Modelling Forum) (Weyant, 2004b), the EU-based Innovation Modeling Comparison Project (IMCP) (Edenhofer et al., 2006) and the multi-model calculations of climate ‘stabilization’ scenarios summarized in the TAR (IPCC, 2001). In a new development since the TAR, technology has also moved to the forefront of a number of international and national climate policy initiatives, including the Global Energy Technology Strategy (GTSP, 2001), the Japanese ‘New Earth 21’ Project (RITE, 2003), the US 21 Technology Roadmap (NETL, 2004), or the European Union’s World Energy Technology Outlook (WETO, 2003).

The subsequent review first discusses the importance of technological change in ‘no-climate policy’ (or so-called ‘reference’ or ‘baseline’) scenarios, and hence the magnitude of possible climate change. The review then considers the role of alternative technology assumptions in climate policy (‘stabilization’) scenarios. The review continues by presenting a discussion of the multitude of mechanisms underlying technological change that need to be considered when discussing policy options to further the availability and economics of mitigation and adaptation technologies.