As the 2008 presidential race continues to escalate, not much attention will be paid in the popular press to the candidates’ positions on patent law.  However, much attention will be paid to the issues of energy independence and global warming, given that both candidates have declared a need to address those issues.

In particular, John McCain has proposed presenting a $300 million monetary prize to whoever can invent a battery package far superior to the commercially available plug-in hybrids or electric cars in terms of size, power and cost.  Dennis Crouch at Patently Obvious has an insightful post comparing monetary prizes and patents as incentives to invent.

A question worth asking, however, is whether either tangible prizes such as monetary rewards or patent rights are the proper incentives for the development of renewable energy. Perhaps academic research and inquiry is the primary motive for innovation in the field of renewable energy.  One scholar has suggested:

 [T]he individuals conversant in the technical vernacular of renewable energy technology have a synergistic relationship that builds on individual contribution. Exchange of ideas relating to renewable energy technology is also already well-adapted to highly efficient modes of communication via internet portals and intranets. Contributors to the field of high technologies, such as software and renewable energy, value most the recognition they receive in the form of peer praise, Nobel prizes, and speaking engagements; monetary rewards are relatively less valuable.

Of course, renewable energy technologies will require a great deal of capital investment in order to make such technologies useable in both the short and long-term.  What makes software amenable to an open-source model is software often requires significantly less investment for research and development.  While the automation of the innovation process has reduced the costs of prototyping and testing of new innovations, renewable energy innovations still require significant investment in research and development.  Investors will want a return on their investments if they are going to expend the necessary capital outlays to develop alternative energy incentives.  Therefore, while the scientists may thrive in an open-source model for renewable energy, some tangible incentive, such as patent rights, will be necessary to ensure continued innovation.

 Peter Nikolai    (612) 392-7311    Peter.Nikolai@nm-iplaw.com