Last January, during our "The Greatest Innovations" course, we concluded that energy innovation has a much better chance to succeed in China, rather than US.

Firstly, should China continue its rapid growth while using today's conventional energy technologies, the impact on the environment will be devastating. Why? Because over the last 45 years losses have become the fastest growing energy segment in our fair country. If this technology is simply transferred to China, it will reproduce existing wasteful practices on a much larger scale - China's population is already 4 times greater than ours. Whether we believe in global warming or not, a lot of pollution would be bound to happen. Thus, the need for energy innovation in China is higher.

Secondly, China doesn't have a mature energy infrastructure. Compared to the US, where industrial electricity consumption started growing rapidly about a hundred years ago, China's a relative newcomer to the info-industrial age. Therefore, it makes a lot of sense to create an infrastructure that is based on new technologies, i.e. leapfrog, not copy.

As we can see, the need is higher (environmental impact) and the opportunity is greater (new infrastructure buildup). Also, China has some two trillion dollars to burn, which we don't.

And here's some empirical confirmation for our two-month old hypothesis:

NatCore Technology of Red Bank, N.J., recently discovered a way to make solar panels much thinner, reducing the energy and toxic materials required to manufacture them. American companies did not even come look at the technology, so NatCore reached a deal with a consortium of Chinese companies to finish developing its invention and mass-produce it in Changsha, China.

From this perspective, technology licensing and intellectual property rights are going to become even more important for US R&D firms.

tags: energy, infrastructure, example, problem, solution, trend, innovation