Peer Production and Industrial Cooperation in Alternative Energy

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Summary from the Industrial Cooperation Project:

"The second sector is one of enormous importance, but one for which there has been practically no work done on innovation policy to foster cooperation and knowledge sharing — Alternative Energy. Here, the practices are less well developed, there is no real structure for commons-based practices, but there is substantial and interesting support from the current United States Department of Energy to embrace innovation-sharing practices as part of the global effort to address climate change and sustainability. In this regard, the area is important, and particularly fertile for developing new political alliances around questions of innovation and development as checks on IP. See the AE Synthesis here and working papers here." (


"An example of industry collaboration can be seen in the “Iowa Alliance for Wind Innovation and Novel Development” which is a partnership between “state and local governments, the community colleges, universities, the private sector, associations and community organizations, and the federal government.” (



"In Alternative Energy, we found enormous recent activity and investment in the development of new tools and products worldwide, and an exponential grown in the number of patents mirrors this activity. We began our research with the intention of limiting our scope to the US only, but given the global scope of the alternative energy market, and the fact that almost all the market leading companies have grown in foreign countries where the markets for this technology have been biggest and which can be considered historical centers of technology innovation, we chose to include Germany, Denmark, and Spain. Additionally, among the countries considered emerging economies, we decided to look at China for the geopolitical implications relating to its relationship with the United States, but also for its surprising and fast growing number of patents.The potential reasons for this may be many, but some are attributable to consistent combination of push and pull policy choices in some of those countries.

We chose wind, solar and tidal/wave technologies with the expectation that we would find variations among their approaches to openness and closedness, since the technologies represent different levels of maturity and patenting activity. The maturity can be measured both by the stage of development of the technology and the stage of development of the market. For instance, wind is considered a mature technology because it is fairly well understood, and the cost of generating electricity with wind turbines is closer to the cost of conventional sources of fossil fuel generated electricity - though it is still more expensive. Solar photovoltaic (PV) technology is less mature and can be quite expensive, therefore the research and innovation around solar PV technologies is sure to play a critical role in bringing its costs down and generating more efficient technology. Tidal/wave technology is relatively immature compared to wind and solar, and is mostly in the demonstration phase at this time.

What we found was relatively traditional industrial innovation practice - research and development at big companies, venture-backed startups, investment by governments in national laboratories with traditional knowledge and technology transfer processes in place. The end products and their industrial sellers appear to be much less affected by emergent commons-based processes than software, culture, and educational materials. They are products like massive wind turbines or solar arrays, physically manufactured at high expense, covered by entire families of patents, and subject to a very traditional innovation paradigm. The wind market is concentrated amend some top industries that have been acquiring small innovative companies for many decades. We did find some uptake and endorsement of open source software, especially around the advance of Smart Grid technologies, though we did not research deeper on that, as well as intriguing new projects around access to energy data, which point to intriguing hypotheses about how CBP could emerge in the field and begin to disrupt the industry in the future.

There is clearly a desire by many of the key stakeholders in energy to “change the game” and increase the overall rate of innovation in renewable energy. This desire has been expressed in the US very clearly in President Obama’s innovation strategies, including by Energy Secretarty Chu and Commerce Secretary Locke. The OpenEI (to share smart grid data in a manner consistent with the US system), U.S. OpenLabs, and the Database of State Incentives for Renewables and Energy (DSIRE) all point towards the intrusion of new market forces into what has been a fairly traditional industrial sector, one that has had more in common with the creation of airplanes or automobiles than with software engineering or educational materials construction. The Obama administration is also working with new market forces via the Kauffman Foundation for entrepreneurship, hosting (and even webcasting) events at the White House and in general positioning itself as a force for more openness in energy data and potentially in technologies. In a recent meeting (05/08/2010), knowledge sharing and new way to bring research from universities into development and the market were key themes, in addition to the necessity of generating jobs within the US borders.

It is estimated that, until recently, 2/3s of investment into alternative energy R&D within the USA came from the private sector, however, there is a broad acceptance that the government should be the responsible for investing in new, risky, and possible disruptive, basic research for innovation within AE. This is due also to the disappearance of large corporate laboratories - such as Xerox Lab, BellLab, and others - which has increased the importance of national labs and universities as key players for early stage innovative research. Thus, after a couple of decades with low public investment in renewables R&D - as of 2007, federal support for energy R&D had fallen by more than half since a high point in 1978, and private-sector energy R&D has similarly fallen - , a recent major investment under the recovery plan (ARRA 2009) was devised. By analyzing the innovation pipeline of alternative energy a series of programs were devised by the DOE. At the basic research level, 46 Energy Frontier Research Centers (EFRCs) within Universities and National Labs were created. The EFRC represents an increased emphasis on the importance of university based research, and expands the R&D funding for this research. At the translational level, the Advanced Research Projects Agency-Energy (ARPA-E) was created and modeled after the Defense Advanced Research Projects Agency (DARPA). ARPA-E will fund energy technology projects that translate scientific discoveries and cutting-edge inventions into technological innovations, and will be distributed through awarding grants, cooperative agreements or Technology Investment Agreements The program should also accelerate technological advances in high-risk areas that industry is not likely to pursue independently. And, finally, the Energy Innovation Regional Clusters (E-RIC) aimed spur regional economic growth while developing innovative energy efficient building technologies, designs, and systems.

This desire by the US is actually preceded by private and public interventions elsewhere. Denmark saw industrial cooperation on “vertical stacks” of wind technologies in the 1990s, in which competition was voluntarily restricted by companies in order to achieve greater interoperability, and the wind industry in the US also collaborated via informal “club” arrangements hosted at Stanford to achieve more reliable gearboxes without demanding new patent applications and licensing. So the US government entry is not without precedent, but the power of the US government to change the market is indeed a major new player in the industrial cooperation arrangements we expect to see in the next decade." (

2009 Status Report

Carolina Rossini and Silas Bauer on A Rapidly Growing Market:

The market for alternative energy technologies in the United States, for instance, has grown due to a myriad of indirect and direct factors. Indirectly, global climate change concerns and volatile fossil fuel prices, along with US energy security concerns tied to its dependence on unstable foreign sources of oil, have pushed alternative energy into a strategic position of importance. Direct factors affecting growth have been a recent increase in private funding for alternative energies, and a growing public-sector opinion that supporting these technologies is in the best interest of the country. Up to this point, the US has lagged behind other countries, mainly those in Europe, in terms of both its public research and development (R&D) and demonstration funding (supply-push policies), and its technology deployment funding (demand-pull policies).

Spurred in part by the increasing momentum of the “Clean Tech” movement, alternative energy producers, consumers, and various regulatory and advocacy bodies are each responding to and evolving with the field, and thereby creating new market demands and offerings. While these trends are complicated in their economics, politics, and other social factors/barriers, the gradual consolidation of the field’s largest producers is already perceptible in the wind market, for instance.

IP and Alternative Energy Technologies

As global climate change continues to dominate international negotiations around capping carbon emissions, the IP rights of the technologies that will facilitate the carbon reductions have become a hotly debated topic.

Patents represent the most significant IP tool involved in this field. Until recently, the IP factor did not parallel the usual IP debate found elsewhere in regards to access, sharing or balance. Many IP issues did not come to the center of attention of IP observers or even civil society groups focused on IP issues and development. This is because the debate over clean and renewable technologies has been politicized and linked to long-term discussions around climate change, but not linked to innovation and IP as in other fields like pharmaceuticals, software, and cultural works.

In this sense, political strategies from Clean Tech and renewable energy industry associations were much more focused on policies to foster the adoption of these technologies over oil-based energy as explained in this report. Thus, we observed a stage in our research where few in the international IP community paid attention to the crescendo of patents in the Renewable Energy market.

Open and Commons-based Approaches versus Proprietary Approaches to Innovation in the Alternative Energy Market

However, this situation changed dramatically in the spring and summer of 2009 with the advent of the Obama administration making public statements about sharing technology related to energy. In reaction, the United States Chamber of Commerce, a leading lobby representing businesses, is expressing growing concern that moves to spread new energy technologies to developing countries could erode the IP rights that have driven commercial efforts to innovate for generations.

Late in May 2009, the group and representatives of General Electric, Microsoft and Sunrise Solar gathered in Washington to launch the Innovation, Development & Employment Alliance, or I.D.E.A. The initiative is aimed at pressing Congress and the Obama administration to ensure that global climate-treaty talks do not weaken protections on who can profit from new technologies that provide abundant energy without abundant pollution. The creation of I.D.E.A. has been widely noted, with some alarm, in the IP “watchers” community, and likely means the status of alternative energy as a less-observed IP sector is finished for good.

Private industry views the patents on these technologies as a necessary to ensure a return on their R&D investment, while many governments around the globe have identified the challenge of climate change as worthy of compulsory licenses for critical technologies. This policy is modeled on the TRIPS Doha Declaration, which allows compulsory licensing of pharmaceuticals that are critical to public health. The United Nations Framework Convention on Climate Change (UNFCCC) has been the host of these discussions as member nations are trying to design the Post-Kyoto regime. China, India and Brazil have, for example, been advocating for the compulsory license provision in order to provide technologies at a reduced price to developing nations. The United States has been divided on the issue and has powerful entities working on both sides.

The new Secretary of Energy, Steven Chu, a Nobel Prize winner, has publicly supported collaborating with developing countries - in particular China - and sharing all IP rights of the resulting technologies. He has already pushed forward with a new U.S.-China Clean Energy Research Center, developed with $15 million dollars each from the U.S. and Chinese governments, and designed to create innovative technologies for building energy efficiency, clean coal (including carbon capture and storage) and clean vehicles. In addition, Secretary Chu is advocating for the development of open-source building energy-efficiency software that will make it cheaper and easier for developers to implement energy saving measures in new buildings, both in the U.S. and in emerging economies like China and India.

In reaction, I.D.E.A.’s first act was to back the Larsen-Kirk Amendment to the Foreign Relations Authorization Act (H.R. 2410). The amendment calls on the President, the Secretary of State and the Permanent Representative of the United States to the United Nations to uphold the existing international legal requirements for IP rights and avoid any weakening of them for the UNFCCC in the context of energy and environmental technology. The Amendment passed the House with a 432-0 vote. It was described as an amendment to protect U.S. green jobs and U.S. technology innovation.

Internationally, IRENA - a multi-national organization whose membership includes more than 79 countries pledging to facilitate the global growth of renewable energy through the sharing of all relevant information including renewable energy resource measures, best practices, effective financial mechanisms, and state-of-the-art technological expertise - still does not show a clear position in relation to the dispute around sharing of IP. But it is clear in its goal in facilitating sharing of information and technology transfer." (

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