Italy risks missing the ‘green technology’ train

Leggi in italiano

Relying on fossil fuels, as well as being a primary cause of global climate change, can threaten a country’s future. More than 40% of EU’s imports of natural gas come from Russia, and European countries that heavily depend on Russian gas, such as Italy, could be hit particularly hard by the fallout of the Ukraine crisis. This dependency also compromises some countries’ ability to act freely and independently on foreign policy. Low-carbon technologies, such as renewable energy, are essential to meet the greenhouse emission targets defined globally in order to tackle the climate crisis. They may also offer a way to better geopolitical stability and security, and towards energy independence for countries that do not rely on fossil fuels.

A recent report on Italy’s energy system published by the National Agency for New Technologies, Energy and Sustainable Economic Development (ENEA), shows that Italy is lagging behind other European countries when it comes to patenting green technologies. The report describes a widespread and strong “technological despecialization” and “no sign of appreciable improvement”. While countries such as Germany, France, Belgium, Denmark, Spain, Sweden are specializing on several aspects of green technologies, Italy is losing ground in all, with the exception of solar thermal (see Table 1). Italy, in other words, risks being dependent on other countries again.

Nature Italy talked to Daniela Palma, a senior researcher on innovation economics at ENEA, and author of the report’s section on despecialization, to understand how this process is affecting Italy within the European and global low carbon technology scenario, and what can be done to counter it.

What is technological specialization?

It is a measure of a country’s innovation path in a given sector, and is the ratio between the global share of patents that a country has in in a specific field, and the share of patents it has on all technologies. This intensity relationship tells us how much the country is focusing on innovation in that sector, and it represents a relative advantage.

Why is it important, in particular when it comes to energy technologies?

Becoming strong innovators in certain fields would allow Italy to avoid technological dependence on other countries. Today, for example, we have energy dependence, meaning that we import fossil fuels. Technological dependence on renewables will be equally crucial. If we have no independence in this area, we will import [low carbon] energy and thus generate a new dependency. We have analysed a number of technologies that are central to the decarbonization process, which concern renewable sources and enhancement technologies such as batteries, for example, or the use of electric cars.

What are the findings?

Globally, patents on low-carbon technologies such as solar and wind power, batteries and electric vehicles have increased recently, and now represent over 40% of all patents in environment-related technologies. Italy has a weakness because it innovates on renewables less than it does on average across all technologies, with an exception relating to solar thermal energy. We found that there is a trend towards importing renewable technologies. Italy is falling behind compared to other European countries that, instead, are innovating in a diversified manner.

The report is based on the analysis of patents. Why? And how much of Italy’s “disadvantage” is based on procedural problems linked to patents rather than on a lack of innovative research?

Patents are an imperfect measure of invention and innovation, because in some technological sectors there is a tendency to request and issue more patents than in others. But for low carbon technologies, they are very important. The Italian situation is certainly linked to a fundamental problem of investments in research, and to the structure of the [Italian] industrial system, which is relatively poorer than in other European countries. The innovative capacity is linked to the characteristics of the system as a whole.

Is despecialization also linked to rising energy prices?

The current increase in energy prices is seen by most analysts as transitory. However, some countries have set out to diversify their energy production more, and are now less affected by it. Italy should focus on the long-term goals of decarbonization. Of course, this also means limiting dependence of the most traditional sources of energy that generate tensions on pricing where we are more vulnerable. Italy’s effort now should turn to seek greater alignment with what has been done in the rest of Europe.

What can Italy learn from those European countries that are already innovating? Can the National Recovery Plan (PNRR) change things?

The most comparable countries in terms of economic size, such as France and Germany, tend to have a more robust innovative system that has allowed them to generate investments in new energy technologies. The new plan that relies on European funding is incredibly important, but it must be combined with policies to strengthen the research and innovation system through ordinary budgetary measures. The PNRR must be accompanied by a greater overall capacity to direct economic policies towards an infrastructural type of strengthening, especially in the area of research and innovation.