Summary/Abstract
Patterns of technology diffusion provide important insight into the development of effective policies to promote the innovation and installation of new technologies. The dissemination of new technologies tends to follow a recurring pattern called the S curve. This pattern includes a slow initial adoption, a take-off phase, and then slow dissemination to the remaining population. Recently, experience with the development of renewable energy followed this pattern. Renewable energy’s growth not only demonstrates this diffusion pattern, it reveals the effectiveness of certain policies that promoted diffusion. It also illustrates the difficulties that can arise when policies do not match a technology’s location onthe S curve.
This paper considers the possible effectiveness of these policies in developing carbon dioxide removal technologies. The paper focuses on price regulations, typically in the form of price subsidies (FITs) or tenders (competitive auctions). It also considers secondary policies – primarily tax credits and cash grants – that enhanced the effectiveness of the primary policy.
This review of renewable energy diffusion and the policies that supported it helps to construct a set of principles and policies that can accelerate the diffusion of CDR technologies. These policies will need to reflect the differentiation of technologies and geographic resources, provide a stable policy environment to encourage investment, and incorporate mechanisms to respond to changing technological and market conditions.