Policies to Encourage Clean Technology

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Abstract
Government policies to promote clean technology in the advanced industrial nations of France, Germany, Japan, the Netherlands, Sweden, the United Kingdom, and the United States are reviewed. Each nation's general environmental policy is characterized, and its use of specific tools for encouraging clean technology is discussed. Acknowledging the complex motivations of targeted firms, some less-used policy options offer promise: financial incentives, training and education programs, consumer information, and especially efforts to reduce firms' risks. Attractive riskreducing opportunities include activities that develop common visions (plans, goals, and schedules) and increase trust (voluntary agreements, performance monitoring).Governments are thinking about new environmental policy questions. Following the industrial ecology metaphor, they no longer want only to control pollution, but would prefer to prevent pollution in the first place. They ask: What can governments do to encourage environmentally beneficial innovations in industry? What motivates firms, and how well do policies target firms' motivations?This chapter explores the questions above by reviewing government policies that encourage clean technology in a set of advanced industrial economies. It first summarizes the general environmental policies of these nations, and identifies tools intended specifically to promote clean technology. It then sketches a conceptual model of what motivates firms, and evaluates how well current policies map onto these factors. The chapter concludes with recommendations for policy options having potential for greater use.Clean technologies include low-emissions ‘closed’ production systems, internal recycling and reuse of wastes, substitutions away from toxic inputs, improved efficiencies of energy and materials use, and products designed for lower environmental impacts over their life cycle. Clean technologies are important, but still subsidiary, parts of the overall industrial ecology concept.

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