Do Investments in Clean Technologies Reduce Production Costs? Insights from the Literature
In response to growing environmental concerns, particularly climate change, governments have encouraged innovation and adoption of clean technologies through various policy measures. At present more than half a trillion US dollars is being invested...
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| Language: | English |
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World Bank, Washington, DC
2021
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| Online Access: | http://documents.worldbank.org/curated/en/758291624565097893/Do-Investments-in-Clean-Technologies-Reduce-Production-Costs-Insights-from-the-Literature http://hdl.handle.net/10986/35885 |
| Summary: | In response to growing environmental
concerns, particularly climate change, governments have
encouraged innovation and adoption of clean technologies
through various policy measures. At present more than half a
trillion US dollars is being invested annually in clean
technologies. Based on the existing literature, this study
analyzes whether investments in clean technologies increase
productivity. The findings are mixed. Employing firm-level
data, the majority of ex-post studies show a positive
relationship between clean investments and firms’
productivity, especially in the energy-intensive
manufacturing sector. Most studies for the transport,
building and power sector use an ex-ante, technology or
sectoral level analysis instead of ex-post analysis to
examine the economics of clean technologies. In the
transport sector, transportation services with electricity
or hydrogen are still more expensive than that with gasoline
and diesel vehicles. Some studies, however, project that
cleaner vehicles will be economically attractive within a
decade. Many studies report that clean technologies reduce
energy consumption and save energy bills in the building
sector, although some studies do not agree. Most studies for
the power sector indicate that renewable technologies have
not yet reduced the average costs of grid electricity
because of their intermittency and a smaller share in the
total electricity supply. |
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