This report is not only about the promise such
technologies hold for the clean energy transition, but
about the lessons we can draw from such examples. It
is about how we think, and often fail to recognise or
understand the opportunities that arise from innovation
and transition in major technologies and systems.
Case studies, detailed in the Online Appendix, delve
further into the three cases illustrated above, including
their development in the major emerging economies
indicated. Beyond R&D, all highlight strong and sustained
government action in market and industry developments.
Moreover, often it was action taken despite (rather than
because of) traditional approaches to economic appraisal
– delivering changes which have rendered largely irrelevant
numerous historical (and even recent) modelling estimates
of how much it would cost to tackle climate change – and
how best to go about it.
Consequently, this report starts by outlining the
fundamental features of traditional economic appraisal.
It then turns to look at each of the three historical cases
above, including how these changes occurred and the role
of government policy and appraisal in each.
The report then outlines alternative approaches to
economic appraisal which better capture the real
economics of innovation and transition, particularly in
relation to the challenge of deep decarbonisation. We
then consider the implications for two more transitions
to technology currently at earlier stages of emergence,
namely road transport and steelmaking technologies.