How does someone make money on any technology he/she invents? Well, one gets revenues and, hopefully, profits from selling the technology or get royalties and revenue from licensing agreements – a percentage of future sales. These are ways to make money from selling the technology. But if you really believe your technology will be effective in reducing greenhouse gas emissions and will benefit the buyer financially that way, might there be other ways to profit? Some are considering contract provisions that will enable the owner of a patent to also make money on how the technology functions – how many tons of GHG emissions are reduced or how many credits (and revenue) the equipment can create. In other words, include in the contract a provision for future revenue based on potential future environmental benefits or revenue based on these benefits. Law firms are looking into these questions to potentially help their clients generate significant future revenue from the technology’s future value to the buyer. As a longer term benefit, if this principle becomes commonplace it may create significant new incentives for companies and individuals to develop innovations related to climate change – something that is desperately needed.

Can this work in real life in the US? There are issues, such as the fact that in the US there is no agreement for the price of GHGs. There is no national tax or trading program that might set a price or a baseline price. Who would set the price? In the US, one can set a price based on the Regional Greenhouse Gas Initiative or California’s AB 32, but these are regional and specific programs. Voluntary carbon markets exist but are not regulated and may breed fear of the carbon market and distrust. Also, how do we keep the price reactive to the times and markets, but relatively stable?

Therefore, we need a national policy to regulate the carbon market and provide a value for GHGs. This will not only allow companies to plan their GHG emission reductions, but also unlock innovation in the climate change industry. The results of the US Presidential election soon will tell whether we move toward these principles or stay in denial of the problem. Not only will an aggressive policy toward reduction in GHG emissions be better for the planet and for industry in most cases, but can unleash innovative and creative technologies to aid us even beyond carbon in the future.

CCES has the experts to help you assess your “carbon footprint” and energy usage and develop cost-effective strategies to reduce your GHG emissions and energy usage to maximize the financial benefits. Contact us today at 914-584-6720 or at karell@CCESworld.com.