Energizing the World with Innovation – Results of the Global Innovation Index 2018
Energy demand is reaching unprecedented levels as a result of a growing world population, rapid urbanization, and industrialization. Higher levels of technological and non-technological innovation are required to meet this demand, both on the production side of the energy equation (alternative sources, smart grids, and new advanced energy-storage technologies) and on the consumption side (smart cities, homes, and buildings; energy-efficient industries; and transport and future mobility). Innovation plays key roles in addressing both sides of that equation. However, technological innovation alone is rarely the solution. Changes in societal norms and cultures along with innovations in organizational processes, e.g. agile project management, are also essential.
Countries around the world have unique approaches to this challenge, based on their own economic, social and political realities. Hence, the relationship between energy and the environment features prominently in the U.N.’s Sustainable Development Goals (SDGs), especially goal number 7: “Ensure access to affordable, reliable, sustainable and modern energy for all.” International cooperation is necessary to facilitate access to clean energy research and promote investment in clean energy technology. Goal number 9 refers especially to innovation and industry.
This year’s Global Innovation Index (GII) report [https://www.globalinnovationindex.org/home], a collaboration between INSEAD, Cornell University and the World Intellectual Property Organization (WIPO), examines how the leaders in global innovation bring education, research and business together to solve challenges, such as how to power the future. It provides detailed metrics about the innovation performance of 126 countries which represent 90.8% of the world’s population and 96.3% of global GDP. Its 80 indicators explore a broad vision of innovation, including political environment, education, infrastructure and business sophistication.
A look at the 2018 league table of the GII confirms the surprising presence of several countries or economies with small populations or relatively small economies. Among the GII top 20, one can find, for example, the Netherlands, the Nordic EU countries, Singapore, Israel, and Luxembourg—in spite of the fact that large economies such as the United States of America (U.S.), Germany, and now China are also part of this top-ranked group. High-income economies are more innovative when their economic structures—and thus their industry portfolios—are more diverse. Similarly, economies at all levels of development happen to be more innovative when they have a more diversified export portfolio.
However, encouraging signs emerge from developing countries, showing how innovative policies and systems can address the challenge. For example, Costa Rica has been edging towards complete independence from fossil fuels for several years. Reliance on renewable energy sources – hydro, geothermal and wind – already provided 98 percent of the country’s electricity in 2016. It combines natural sources (e.g. volcanoes) and smart grids, including micro-grids using solar energy as a back-up source of electricity.
Public authorities play a central role in stimulating energy innovations. Policy makers have a responsibility to provide funding mechanisms, to utilize portfolio management for selecting and prioritizing innovation projects and programmes as well as to deploy policies for support of innovators and their activities. They often play the role of risk takers, both by promoting mechanisms that stimulate investment and the diffusion of technologies with disruptive potential and by supporting projects with high technological risk. Public and private investments in R&D can also scale up grassroots innovations and local communities so that technology development addresses their needs and aspirations, particularly in low- and middle-income economies. Investments in competence development enables both, creating innovative solutions and managing their execution through projects and programmes.
Listen to Bruno Lanvin, Executive Director for Global Indices at INSEAD and co-editor of the Global Innovation Index report https://www.youtube.com/watch?time_continue=12&v=rXl5Jotdq4Q