Intellectual Property and Sustainable Development

U.S. Identifies Vast Riches of Minerals in Afghanistan - NYTimes.com

via www.nytimes.com

http://www.nytimes.com/2010/06/14/world/asia/14minerals.html?pagewanted=1&ref=world

An interesting development in Afghanistan, in particular regarding the large scale commercialization of electric vehicles. Apparently, the US has recently learned that Afghanistan holds vast supplies of lithium, a essential component of most batteries for electric vehicles. Some have speculated about the likelihood of limited supplies of lithium as a limiting factor in the meaningful growth of the electric vehicle market. See our earlier post on the topic here.

In addition, the war-ravaged country also holds vast reserves of iron and copper, based on geological surveys conducted by the Russians several decades earlier, the NY Times Reported recently.

The NY Times writes, quoting government officials:

“No one has tested that law; no one knows how it will stand up in a fight between the central government and the provinces,” observed Paul A. Brinkley, deputy undersecretary of defense for business and leader of the Pentagon team that discovered the deposits.

At the same time, American officials fear resource-hungry China will try to dominate the development of Afghanistan’s mineral wealth, which could upset the United States, given its heavy investment in the region. After winning the bid for its Aynak copper mine in Logar Province, China clearly wants more, American officials said.

Another complication is that because Afghanistan has never had much heavy industry before, it has little or no history of environmental protection either. “The big question is, can this be developed in a responsible way, in a way that is environmentally and socially responsible?” Mr. Brinkley said. “No one knows how this will work.”

Technology Mechanism for Climate Change: Still in the Lab

The first set of 2010 climate change negotiations under the UNFCCC concluded in Bonn, Germany (April 9-11th) with no progress apparent on the Technology Mechanism referenced in Paragraph 11 of the 2009 Copenhagen Accord. 

In fact, the only real outcome of the meeting appears to be an agreement to hold two additional meetings for both Advanced Working Groups on Long-Term Cooperative Action (LCA) the Kyoto Protocol, as well as for both of these groups to prepare draft texts to facilitate negotiations.  Conclusion for the LCA and Kyoto Protocol Working Groups are available here and here, respectively.

Although developing countries are pushing for legally binding commitments as an outcome of the December 2010 Conference of the Parties (COP) in Cancun, this does not appear likely. 

The Copenhagen Accord (the Accord), in particular the way in which it was negotiated, has led to what observers at Bonn are calling a sense of “deep distrust” at this past meeting between developed and developing countries.  Australia, on behalf of the “Umbrella Group,” stated that the Accord was a clear expression of political will to combat climate change and gave direction for future work.  However, many are concerned that the Accord would result in the end of the Kyoto Protocol.

Specifically, regarding the Technology Mechanism of the Accord, or “enhanced action on technology development and transfer” as it is being negotiated under the in the Working Group on LCA, several issues remain undecided, based on outside reports, including whether:

• activities or outcomes of activities eligible for support can included “purchasing of licenses and other intellectual property (IP) issues”;
• implementation of the technology mechanism shall be funded by new financial arrangements to meet the full incremental costs of compliance;
• the mechanism should support removal of barriers to technology development and transfer and enhancing means to promote technology transfer;
• the Technology Executive shall, among many other things, “address intellectual property issues as they arise”;

and most significantly – whether Intellectual Property Rights (IPRs) will be mentioned in the text, and if so, whether:

• International agreements on IP shall not be interpreted so as to prevent parties from taking measures to address mitigation or adaptation to climate change (e.g. Articles 30 and 31 of the TRIPS Agreement);
• Global Technology Intellectual Property Pools for Climate Change are created;
• Steps are taken to share publicly funded technologies and know-how;
• Patents over environmentally-sound technologies for mitigation or adaptation are excluded from IP protection, including the revocation of any existing IP rights, in particular those that are publicly funded or those involving the use of genetic resources for mitigation or adaptation; or
• A recommendation is made that international action be taken to remove barriers to technology development and transfer, including those arising from IP rights.

In short, negotiators still have a range of options for how they choose to deal with the IP issue.  Obviously, industrialized countries are on the side of not weakening IP protection, with developing countries pointing to past experiences with the refusal to license non-ozone depleting (non-CFC) propellants to India and Korea, as well as experiences with essential medicines under the WTO's TRIPS Agreement.  But, interlinked to technology transfer is the issue of financing – the details of which are still skeletal as well and perhaps dependent on what becomes of the Copenhagen Accord. 

The next intersessional meeting is currently scheduled for the 1st-11th of June 2010 in Bonn, with the two additional meetings to be held between then and the Mexico COP in December.

Known lithium deposits can cover electric car boom

MEXICO CITY/LA PAZ (Reuters) - Hopes of an electric car boom are spurring companies to seek new lithium sources, but new finds may be lower quality and costlier to develop than established deposits able to meet demand for years to come.

via www.reuters.com

Recent articles in Forbes and Time suggest that factors affecting the supply of lithium for rechargeable batteries will keep electric vehicles from having meaningful marketshare.

However, there are many who disagree. The bulk of the 13 million tonnes of known lithium reserves are found in countries along the Andes, mostly in Bolivia (USGS). But, China, the US, Australia and several other countries have sufficient supply to avoid an OPEC-like cartel.   Global production of Lithium carbonate was 98,000 tonnes in 2008 (Market Oracle). In addition, unlike oil, Lithium can, and often is, recycled.

In a typical electric car, lithium accounts for 1.8% of the cost of the battery (eco geek). It is a cheap commodity, trading at around $3/lb in 2009 (Commodity Online). Some research analysts suggest that this means that the price can increase, but this will only make alternative extraction methods more economically viable, preventing further upward price increases.

As in the case of any mining operation, there is a significant concern of ecological damage, in addition to the health of miners. Lawmakers, if not the Automakers themselves, need to ensure that production of these 'cleaner' electric vehicles, including the extraction of the raw materials, have as little environmental impact as possible.

The Weather in Massachusetts

US health care is not the only issue that might suffer from the stunning defeat of US Democrats' in the special election to replace Teddy Kennedy's senate seat.

With the loss of a filibuster-proof majority in the Senate, the chances of having US climate change legislation that both caps greenhouse gas (GHG) emissions and puts a price on GHG emissions appears abysmal.  A recent editorial in the NY Times briefly lays out some of the reasons that the US Congress must pass a climate change bill.

However, the NY Times fails to mention an issue dear to the heart of this blog: technology.   The US taxpayer has invested tens of billions of dollars in climate change-related technology research through the American Recovery and Reinvestment Act of 2009 (ARRA), colloquially known as the "US stimulus bill."  These investments include:

• Smart grid development (US$ 11 Billion)
• Establishing an Office of Federal High Performance Green Buildings (US$ 4 Billion)
• Local and State investments in clean energy (US$ 6.3 Billion)
• Carbon Capture Experiments (US$ 3.4 Billion)
• Upgrading housing and infrastructure (US$ 14 Billion)
• Renewable Energy Research, unspecified (US$ 2.5 Billion)
• Electric Vehicle Research and Purchase (US$ 2-3 Billion)
• Geothermal Energy Research (US$ 0.4 Billion)
• Funding for various government research institutions (US$ 8.9 Billion)

As a return on this investment, US politicians - Democrats, Independents and Republicans, alike - must ensure that there is a market for these technologies, once developed. 

America should take the lead in climate change legislation.  This commitment would encourage other countries to take similar steps, helping to expand markets for US technologies, potentially reducing US trade deficits.  It would ensure that US investments result in a competitive advantage, thereby securing US domestic jobs at a time of double-digit unemployment.  US climate legislation will encourage the US private sector - one of the world's most innovative in the world - to continue to invest in environmentally-sound technology research.  Most importantly, it is vital to preventing a global humanitarian crisis in many small-island states and developing countries who face the increasing risk of droughts, floods and other disasters. 

The situation in Haiti reminds us all that precaution and prevention is a worth-while investment.  It is time that the US Congress ensures that there is a return on the investment in climate-related technologies. 

"Green Tech" Venture Capital Continues its Rebound

According to a survey by Deloitte and The Cleantech Group, venture capital investment has continued its recent resurgence, rebounding from abysmal levels late last year and the beginning of this year. The survey credits government stimulus efforts for restoring the confidence of private investors in green tech ventures. Investments in North America, Europe, India and China totaled 1.3 Billion USD for the third quarter of 2009, a 10% increase from the previous quarter, but still 40% lower than the third quarter of 2008. Kohsla Ventures succeeded in launching two new green-tech funds, totaling 1.1 Billion USD. Indeed, the role of non-IPR incentives, i.e. government policies, appear to be playing a critical role in stimulating investment: “The extension of tax credits for renewable-based power generation along with government stimulus and regulatory requirements to meet renewable portfolio standards are helping to drive continued investment on the part of VCs and utilities into the cleantech sector,” said Scott Smith, U.S. leader of Deloitte’s Clean Tech practice. “Utilities are increasingly bringing their access to capital to the sector through direct investment and power purchase agreements, driving new projects and increased capacity. We continue to see utilities investing in wind and solar and expect this trend to continue as cleantech projects become more economically viable and desirable for utilities.” However, the investment is being made in companies well beyond the R&D phase. Solyndra and Tesla Motors, two of the largest recipients of VC funding, attracted funding for proven technologies - thin-film solar tubes and electric vehicles, respectively. Solyndra is using its funds for increased manufacturing, while Tesla is using its share for increased global marketing and retail efforts. The solar sector received the lion's share of the funds, followed by transportation and green buildings. China and India received only 3% and 1.5% of the total VC investment. The US, Europe and Israel accounted for the remaining 96%. The Cleantech Group's report can be accessed here: http://cleantech.com/about/pressreleases/20090930.cfm