Sometimes, Even the Biggest Prize Is Not Enough

GreenOrder

Sometimes, Even the Biggest Prize Is Not Enough

My colleague Truman Semans and I wrote here last week about the power of prizes to inspire the ingenuity needed to solve some of most pressing problems of our time, chief among them the need for environmental innovation.

But despite their cachet and impressive track record, prizes are not a cure-all for our every woe [PDF]. Just as there are important ways that they are underutilized, for instance by the government as a tool to stimulate technology innovation [PDF], prizes are ill-suited for other circumstances.

For example, nearly three years ago Richard Branson announced the Virgin Earth Challenge -- a $25 million prize for the first to develop a commercially viable design for removing at least one billion tons of carbon dioxide from the atmosphere per year for 10 years. But despite 2,500 entries, the prize has gone unawarded and is currently being reevaluated.

This laudable effort poses some important challenges. First, despite an impressive purse, there are orders of magnitude between the award and as much as $2.5 billion needed to commercialize the winning technology. This both calls into question the ability to fulfill the scale requirement -- which is critical to achieve a meaningful impact -- and adds the complexity of engaging commercial partners who can supply added capital and technological know-how.

This speaks to the need for not only clearly defined metrics for success, which this prize has, but the ability of those metrics, if successfully met, to achieve the intended impact. After reviewing concepts for three years, the organizers have concluded that the latter is not possible without bringing onboard these commercial partners as an intermediate step in a longer process.

Policy uncertainty is a second, perhaps more daunting hurdle. The success of any winning idea is significantly dependent on functioning carbon markets and a price on carbon. As waning investments in more conventional means of capturing carbon (carbon capture and storage associated with fossil fuel energy production) have illustrated, absent meaningful regulation that provides long-term certainty, there is inadequate incentive to stimulate the sufficient investment at the scale that is needed. So it seems, the difficulties that the Virgin Earth Challenge is facing is emblematic of a broader industry trend whose inertia may be too great for this effort, in isolation, to overcome.

The point here is not to pick on the Virgin Earth Challenge. We need bold prizes that capture the imaginations of would-be innovators, and the broader public, and that lead to the unconventional collaborations that generate breakthrough ideas. But though a powerful tool, we cannot rely on prizes to solve all our problems, but must instead create the supporting foundation, led by science-based policy, to enable these efforts to succeed.

Image CC-licensed via WikiMedia Commons.