Green Patents: The patent system's "fuel of interest" and the promotion of technological innovation
*Co-authored with Cyrus Frelinghuysen.
IPLaw360 recently reported that Clean Energy Patents Reached a New High in Q2. According to the most recent Clean Energy Patent Growth Index report, the U.S. Patent and Trademark Office (PTO) issued 274 “green” patents in the second quarter of 2009.[1] One might expect that those who regard technological innovation as a necessary tool to combat climate change would welcome the continued increase in the issuance of green patents. Nonetheless, there remains disagreement regarding whether the patent system and the enforcement of intellectual property rights will promote or hinder technological innovation with regard to climate change.
The debate over whether the patent system adequately promotes the development of technology to manage climate change is related to the ongoing debate over the role of technology transfers in any future climate change treaty. Under the U.N. Framework Convention on Climate Change and the Kyoto Protocol, developed countries have undertaken obligations to promote the development and transfer of environmentally sound technologies to developing countries. Indeed, the draft negotiating text for the UN Climate Change Conference in Copenhagen contains provisions for “compulsory licensing for specific patented technologies,” as well as “pooling and sharing publicly funded technologies and making the technologies available in the public domain at an affordable price.”
Though meant to encourage the development and spread of green technology, such obligations may paradoxically reduce incentive for technological innovation because private parties or the governments of developed countries will balk at devoting resources to the research and development of technology that may be expropriated or subject to a compulsory license under a future climate change treaty. In an apparent effort to ease such concerns, the House of Representatives recently passed legislation that opposes any global climate change treaty that weakens intellectual property rights. Within the context of these debates over how to promote technological innovation and how to structure technology transfers, the growth of green patents suggests that the patent system continues to provide at least part of the necessary incentive for the development of technology to combat climate change.
Leading environmental groups such as Natural Resources Defense Council (NRDC) have recognized for the need for “Developing the Technology of the Future” to address the problem of climate change. In a brief issued earlier this year, NRDC argued that the federal government must take action to spur research and development with regard to clean energy technology because “[t]he private sector tends to under-invest in new low-carbon technologies because of the risk of ‘innovation spillovers’ -- that other companies will benefit from their initial research investment.” Others have offered so-called “inducement prizes” offered to anyone who can develop the technology to counter the effects of greenhouse gas emissions. In September of 2007, Sir Richard Branson and Al Gore launched the Virgin Earth Challenge, pledging to award $25 million to the developer of “a viable technology which will result in the net removal of anthropogenic, atmospheric greenhouse gases each year for at least ten years without countervailing harmful effects.” Similarly, during the 2008 presidential race, Senator John McCain proposed a $300 million prize for “the development of a battery package that has the size, capacity, cost and power to leapfrog the commercially available plug-in hybrids or electric cars.”
Plato famously wrote that “necessity is the mother of invention.” Arguably, however, neither “necessity” nor the prospect of “inducement prizes” has been as effective as the patent system in providing the crucial incentive for technological innovation. As Abraham Lincoln (who was granted a patent of his own) once remarked, the creation of patent laws encouraged innovation by adding “the fuel of interest to the fire of genius.”
[1] The patents cover the following technologies: fuel cells (156), wind energy (43), solar energy (36), hybrid/electric vehicles (20), biofuels (13), tidal/wave energy (8), and geothermal energy (2). Corporations that were awarded the most “green” patents include Honda (17), General Motors (15), Toyota (12), General Electric (11), Nissan (9), Panasonic (5), Ford (5), Daimler (4), Enercon GmbH (4), Applied Materials (3), and Bloom Energy (3).
Environmental group sues Bureau of Land Management for failing to consider greenhouse gas emissions in granting oil and gas leases
The Western Environmental Law Center (“WELC”) has filed suit in New Mexico federal court against the Bureau of Land Management (“BLM”), alleging that the agency’s 2008 grant of 92 oil and gas leases in New Mexico violated federal law by failing to address greenhouse gas emissions. The complaint also alleges that the Bureau failed to adopt policies designed to make drilling more efficient. This lawsuit, along with a similar complaint filed by WELC in Montana in December, is among the first to use greenhouse gas emissions as a basis for challenging oil and gas leases in the west. Named plaintiffs in the suit are Amigos Bravos, the Natural Resources Defense Council (NRDC), and members of the Oil and Gas Accountability Project.
WELC argues in its complaint that the agency’s grants of the leases were improper under the Federal Land Policy and Management Act (“FLPMA”), the Mineral Leasing Act (“MLA”), the National Environmental Policy Act (“NEPA”) and the Department of the Interior’s Secretarial Order 3226 (January 19, 2001). The citizen group plaintiffs base their standing to sue on the alleged impairment of their use and enjoyment of lands affected by the leases.
The complaint alleges that oil and gas exploration and operations release greenhouse gases on many fronts, including vented gases from machines, gasoline processing, and coal beds, gases released during transport and refining of oil and gas, and heat and electricity generation. The complaint suggests that gas released from these sources could cause the greenhouse gas concentration in New Mexico to reach a tipping point, a point at which global warming would start to accelerate at a rate beyond human control.
The WELC complaint seeks both declaratory and injunctive relief. It asks that the district court suspend, enjoin or void the leases until the Bureau of Land Management achieves full compliance with the applicable federal law. The complaint also asks that fees and costs be awarded to the plaintiffs.
