The Transatlantic Climate and Energy Dialogue

September 13, 2010

On September 13, 2010, AGI hosted a conference on “The Transatlantic Climate and Energy Dialogue: Balancing Aspirations with Actions,” generously supported by the Daimler-Fonds im Stifterverband für die Deutsche Wissenschaft. Participants discussed American and European perspectives on green technology transfer, intellectual property rights, and community energy planning over the course of several panels. While the opening remarks and keynote address dealt with the outcomes of the Copenhagen Climate Change Conference in 2009 and its role as a confidence-building platform that can forge a binding international commitment in the future, the panels focused on the interactions between developed and developing countries as well as on the exchange between highly industrialized nations in the field of green technology transfer.

The first panel addressed the issue of intellectual property rights and green technology transfer from German and American perspectives. The speakers began by presenting the role of the developed countries in Europe and their influence on world climate policies. The EU’s ambitious goals include cutting emissions by 20 percent and boosting both energy efficiency and green power market share by 20 percent until the end of 2020 compared to 2008 levels. Germany, however, has gone even further by announcing policies to reduce carbon dioxide output by 40 percent by 2020 (likewise compared to the 2008 level). Despite Europe’s efforts, developing countries’ greenhouse gas share has risen vastly in the last decade, making a transfer of green technology mandatory. The United States, however, is slowly catching up with the European Union in its greenhouse gas reduction efforts and after Copenhagen, a non-binding emissions reduction of 17 percent by 2020 was announced.

Overall, U.S. green industry faces unstable settings: As fossil fuels get cheaper, green technology becomes less competitive. Consequently, long-term investments have not been widely made. Introducing a new fuel tax, setting a bottom-line price, and transferring revenues into research could help make long-term investments in green technology possible. Another aspect mentioned by the speakers was the problem of intellectual property rights violations, especially in emerging markets, which is an issue that will not be solved in the near future. In response, German market leaders have already adapted to this situation and focused on cutting-edge innovations in order to stay ahead of competitors.

The second panel dealt with the topic of climate negotiations, technology transfer, and intellectual property rights. Here the discussion mainly focused on how knowledge transfer could be realized. China serves as a major positive example: By applying policies to foster research and development, striving for joint ventures, and imposing local content requirements, the Chinese were able to successfully build a domestic green industry. A yet-to-be installed technology transfer fund (according to the outcomes of the Copenhagen summit) could help other developing countries to do the same. The issue of how the money for the fund will be raised remains unclear, although its structure was broadly discussed and has already been agreed upon. Furthermore, implementing countermeasures to climate change is dependent not only on technological knowledge but also on production capacities. With many developing countries lacking these capacities, the issue of securing intellectual property becomes less relevant. The panelists stated that licensing, granting access to research networks, and introducing open source initiatives are just the first steps to help emerging industries catching up. The more crucial point is to provide private funding for local energy projects. Investments in fossil fuels should be supported as well, since they help to build infrastructure, which, at some point, will be able to produce and adopt green technologies.

The third panel characterized current metropolitan energy challenges in the United States and outlined the response through community energy plans and translation of German best practices for the U.S. context. In the U.S., the lack of functioning international institutions and the bleak outlook for federal legislation with respect to a comprehensive climate change and energy bill necessitate local action. Thus, global innovations have to be recognized and modified for the particular urban area where they will be applied into a context of political, economic, social, and environmental aspects. This sub-national level is the major hub for the so far informal process of green technology transfers. The panel shifted the common argument about green technologies from the environmentally moral language to a rather economic framing in which the actors need to realize the potential of a $1.3 trillion energy market in the United States. The first step does not necessarily include a far-ranging implementation of complex renewable energy systems, but rather has to use already existing technologies in order to increase energy efficiency. Raising awareness about volatile energy prices, energy availability questions, and climate change will help policymakers to understand and eventually make use of opportunities.

Referring to the example of the industrial metropolitan region of Mannheim, Germany, the panel showed the important role a community energy master plan can play and what objectives are going to be targeted: Efficient energy use, clean distribution, renewable energy supply, multi-utility business structures, and integral regional climate plans. Increasing the competitiveness of a region will come together with job creation, lower energy costs, and investments. Distribution security is connected to a supply quality, a reliable infrastructure, and a flexible energy system. Eventually, the environmental target is to reduce greenhouse gas emissions. For all these aspects, long-term thinking, specifically adapted projects, an integrated policy, and community involvement are needed. In order to successfully implement a master plan for a particular urban area, a functioning public-private partnership, also with respect to the project funding, has to be developed.

The final panel connected this analysis to the specific example of cities in Northern Virginia and discussed local governmental and commercial perspectives on the issue. Considering “Dillon’s Rule” in Virginia – through which the state level has to authorize particular powers to the local entities by law – subareas with a sense of boundary and neighborhood are best suited for implementing new energy policies while bypassing the strict state regulations. Furthermore, local governments depend on their private partners’ voluntary compliance in order to bring forward a sustainable community plan, which integrates and interconnects smart growth projects, mixed-land use, public transportation incentives, and efficient community energy master plans. The eventual success of such plans is more likely if a community has a stable governing body, a history of comprehensive planning, clear and verifiable targets, educated and progressive citizens, and a density in its urban area which is understood as an ally in advancing a master plan.

The panelists also discussed the positive role of exchanges between local officials and business people from different countries when referring to the German-American visits that have helped to expose participants to the opportunities and to realize the feasibility of various green projects. The exchange of experience and ideas can be a groundbreaking first step that is followed by a process of inter-institutional cooperation as well as adaptation of innovations to new situations. Comparing Germany and the U.S., the panelists also pointed out the differences, especially with respect to the nearly non-existent lobbying influence of the black coal, oil, and gas industries in Germany – in contrast to the vast impact of those companies, their shareholders, and workers on the other side of the Atlantic. The panel closed with remarks concerning cultural differences in both countries that have favored a rather short-term market orientation as well as cheap and easy access to resources in the U.S. There has been a mismatch between existing legislation and current economic and environmental challenges on the federal and state levels resulting in phenomena like sprawl that goes together with high energy use. However, the panelists drew hope from the few but promising local initiatives (even in conservative or oil/coal states) that have successfully introduced green technologies through a helpful framing of their new approaches as increasing economic competitiveness, creating jobs in their regions, increasing energy supply security, and promoting quality of life in their regions.