Poetry isn’t my favorite art form, but Charles Bukowski’s “Air and Light and Time and Space” is a fine accomplishment. The poem’s message is that external conditions are of limited importance for true creativity. Here’s an excerpt:

baby, air and light and time and space
nothing to do with it
don’t create anything
maybe a longer life to find

Bukowski attacks the idea that people can become creative if they have time and a nice, sunny studio where they can work. What does this have to do with energy technology innovation? Probably not a whole lot, but let me give it a try.

One argument in today’s climate policy discussions is that we should pay much more attention to energy technology innovation. Some commentators, such as The Breakthrough Institute, argue that technology innovation should be the centerpiece of climate policy. In the academic literature, energy technology innovation is often seen as a complement to policies like carbon taxes or emissions trading.

The idea is simple. Since the benefits of new technology are in large part public, entrepreneurs, who cannot reap these public benefits, invest too little in innovation. With or without policy instruments that constrain the use of fossil fuels, the result is underinvestment in clean technology. So, the state should offer public funding for R&D, demonstration, and commercialization.

While the general idea is relatively uncontroversial among economists, few environmental economists would support Breakthrough’s position that innovation can replace policies that constrain carbon emissions. In the absence of constraints on carbon, technology innovation results in large emission reductions only if new clean technologies are so cheap that they begin to displace carbon in the entire economy.

That’s a tall order. Research on the dynamics of energy technologies that such breakthroughs (pun intended) are rare. Since energy technologies are fundamentally physical, they do not advance in gigantic leaps and bounds. That’s very different from information technology, telecommunications, and mobile apps.

Consider the case of shale gas. Although it is now widely called a “revolution” in the United States (see here, here), the reality is that this technology innovation – a technological breakthrough if there ever was one in energy – is expected to have limited impacts on greenhouse gas emissions. As I wrote elsewhere, a recent modeling exercise suggests that shale gas will be largely irrelevant for U.S. greenhouse gas emissions in the coming decades.

That’s assuming there will be no carbon tax or cap on emissions. If the federal government implements a climate policy, however, shale gas can reduce the cost of meeting emissions targets.

What does this have to do with Bukowski? His brilliant poem says that one cannot force creativity. The same is true with energy technology innovation. Investment in improved technology can reduce the cost of emissions reductions, but it would be naïve to believe that technology innovation will displace fossil fuels without actual constraints on the use of carbon. That’s similar saying that, if I only had a sunny studio for my work, I would create true works of art. It doesn’t work like that.