sectoral economic costs and benefits of ghg mitigation - IPCC

Patrick Criqui, Nikos Kouvaritakis and Leo Schrattenholzer
The R&D stock-to-flow ratios are shown in Figure 11 for seven categories of technologies. For
most of them, the ratio is low at the beginning of the period and increases regularly to a level of
about twenty by the end of the period considered (a constant R&D effort would in fact yield a
stock-to-flow ratio of twenty after twenty years). But the breeder R&D expense shows a
completely different profile, with a rapidly increasing ratio since the mid 1980s, rising up to a
level of 135 years in 1995. This clearly indicates that in some respect the breeder may represent
not a “mature” technology in the habitual sense, but an “ageing technology”, for which the
current level of R&D effort is much lower than past effort. Conversely, such technologies as
biomass or wind that did not benefit of large public R&D expenses in the past twenty years, may
appear from Figure 11 as “young technologies” with a stock-to-flow ratio lower than twenty
years.
Table 1 provides information on cumulative PERD for eleven key technologies, the share of the
total PERD effort and the stock-to flow ratio in 1995. The technologies are ranked by decreasing
level of cumulative PERD and it can be noted that many of the technologies with high
cumulative PERD also have high stock-to-flow ratio. This means that the effort today is much
less than it has been in the past twenty years.
Table 1
Indicators of the structure and dynamics of public R&D programs
Cum PERD 95 % of total "Stock to Flow"
(10^6 $90) Cum PERD 95 ratio for PERD 95
Breeder 36 855 17% 135
Nuclear Cycle 32 475 15% 36
Fusion 21 826 10% 26
Nuclear Support 17 459 8% 19
LWR 11 995 5% 40
Conservation 10 231 5% 13
Coal Conversion 8 989 4% 69
Solar 7 727 3% 22
Coal Combustion 3 921 2% 24
Wind 1 580 1% 17
Biomass 1 488 1% 17
% of total PERD 69%
Two main conclusions can be drawn from this survey of the PERD effort in the G7 countries for
the past quarter of the century:
- first, large PERD programs are not a sufficient condition to automatically provide the
technology improvements which are necessary to transform a pilot technology into a market
technology; the breeder case is an exemplary one in this respect; many other factors or
barriers should be considered, from the intrinsic characteristics of the technology to its social
acceptability or suitability to the industry context;
- and second, some technologies with limited cumulative R&D, such as wind and biomass,
have recently experienced important improvements and cost reductions; this also indicates
that “scale of production” economies and experience effects due to learning by doing
phenomenon, which are examined in the next Sub-section have a very important role in the
continuous improvement of a technology and in the transition from pilot to market
technology.
115