Law professor Jonathan Adler recommends prize-based incentives to generate climate innovation

Could a multimillion-dollar prize spur the next big innovation in sustainable climate technology?

School of Law professor Jonathan H. Adler thinks so. He recommends that some of the dollars earmarked for alternative energy research be shifted to prizes.

Adler believes a clear need exists for new technologies that will make climate change costs for businesses and countries less expensive and more available. And with President Obama’s goal to reduce greenhouse gas emissions 80 percent by 2050, “Global climate change is a terribly vexing environmental problem,” Adler said. “Its scope, complexity and potential costs are daunting.”

Adler makes his recommendation in the article “Eye on a Climate Prize Rewarding Energy Innovation to Achieve Climate Stabilization,” recently published in the Harvard Environmental Law Review.

Technology-induced prizes have a successful track record, such as James Maxwell’s mathematical theory of Saturn rings; Heinrich Hertz’s detection of radio waves; and the solution for deriving longitude by English clockmaker John Harrison, who invented the marine chronometer that revolutionized sea travel in the 1770s and continues to guide nautical travel. More recently, Richard Branson inspired inventors to strive for a $25 million prize in the “Virgin Earth Challenge” to reduce greenhouse gas emissions.

Currently, carbon emissions outpace available solutions to curb them. To achieve what climate experts call the stabilization goal would require reducing carbon emissions to between 450 and 550 parts per million. Those lower levels have not been seen in the U.S. for nearly a century, when the population was at 100 million people. Today, the population is approaching 400 million.

“Yet even reductions of this scale would not leave developing nations much room to increase their emissions,” Adler noted.

Offering prizes for sustainable climate change technology could encourage the rapid design of  implementation-ready solutions, as prizes are typically awarded to innovators who can prove their solutions work. And it could be a good alternative to the current model of some $3 billion in federally funded grants offered to researchers working on climate change solutions, which has its drawbacks, according to Adler. Among them is the potential for politics to impact the grant-award process. There are also no guarantees that the research money will produce the desired results, he said, and often, research breakthroughs can take longer as basic science builds from one small piece of the solution to another. Researchers are motivated by the grant structure to take on projects requiring research in long time frames, he said.

“Prizes are no panacea,” he wrote, but, he added, they provide a comparatively low-cost way to encourage greater innovation.