ABSTRACT
This chapter discusses policy support for environmental innovation, building on the systems perspective described in Chapter 6. It begins by reviewing the arguments around the so-called Porter hypothesis, that well-designed regulation can promote environmental innovation in a way that is also economically beneficial. The broader case for direct support for environmental innovation is then given, leading on to the types of policy instrument in relation to ‘systems failure’ arguments. Examples are then given of policy instruments to address systems failures in UK innovation systems for renewable energy technologies, and of a longer-term strategic policy framework to promote a transition to a low carbon economy.
