what are the drivers of net zero innovation?
demand pull and supply push
The drivers of innovation have a major impact on how and when new technologies and their associated new goods and services emerge. Economists believe that because it takes at least two agents to make a market—a buyer and a seller—in principle, there are at least two important forces involved in the innovation process.
One is demand, which, if effective, can ‘pull’ the new innovation out of the laboratory and on to the market. The other potential driver is supply, which may ‘push’ a new innovation out into the market.
Demand is an important driver of innovation. Successful innovations are successful because there is a demand for the goods and services which embody them, and there is a ready market for them. To achieve innovation for Net Zero for consumer lifestyle, for example, there will be a need to generate demand for low-carbon products. Grassroots demand needs to be nurtured, by encouraging consumption of low-carbon products by the public. User driven innovations can be brought forth with the active involvement of consumers whose articulated demand for something in particular provides a clear set of guideposts for innovators.
For mass adoption of low carbon technologies, energy taxation and carbon pricing will make it less attractive to generate greenhouse gases and more appealing for companies to invest in abatement technology. Demand will only stimulate the development of specific new technologies when users are sufficiently committed to the new technologies.
While demand can stimulate innovation, most innovations are, however also pushed up by supply e.g. “technology‐push”. These innovations emerge from the process by which new scientific knowledge and associated new technologies are uncovered and then explored. Given that new technologies are often incremental, they help in reducing costs of innovation.
there are at least two important forces involved in the innovation process.
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