If the threat is as dire as some believe, we cannot wait for policy changes to take effect. Realistically, tax and regulatory policy cannot bring about the type of innovation revolution needed. Taxes discourage growth and regulation restrictions action. While restriction may be worthwhile when it prevents and holds back pollution or bad practices that create severe negative externalities, it can also be restrictive to innovation.

Most regulatory actions take a prescriptive approach that instruct people on the specifics on how they must conduct themselves. Imagine a rule that says all vehicle headlights must be a certain color, brightness, with bulbs of a certain size, shape, and setting within a car. That puts automobile designers and engineers in a box to simply follow the rules rather than think creatively to effectively illuminate space in front of the vehicle by trying out new lighting shapes, designs, placements, and more. Prescriptive regulations hamstring innovators and tie their hands rather than incentivizing and encouraging growth.

The right regulatory climate, then, is required to bring about needed innovation.

When weather, climate, ecology, and environmental issues are at the forefront, many instinctively turn to public policy. They believe there is a real and looming threat to the planet and it is the government’s role to intervene. If that is true, the best way is to create incentives. Climate innovation – perhaps more than any other field – requires less government intervention and more private investment, research, development, and testing.

The first action that is within the government’s scope is to harden assets and protect public infrastructure. That means stronger seawalls and levees, improved drainage and water infrastructure, and a resilient power grid that is sustained by reliable energy sources. After that, if carbon dioxide is the top concern, we should turn to innovators.

The first, most natural, and most obvious solution is trees. Trees store carbon and provide oxygen, animal habitats, regulate local temperatures, and enhance natural beauty. Best of all, little innovation is needed – they were already designed by their creator to do immensely powerful work. However, innovation is needed to best plant trees.

Innovation is needed to identify and analyze potential areas for planting. This can be done by flyover imagery and analysis by satellites, airplanes, or drones. Coupled with artificial intelligence, planters can create sophisticated and optimized mapping to ensure trees are planted where they will thrive.

Still more innovation is needed to get the trees planted. Traditional planting efforts to hand-plant seedlings and saplings with trowels is labor-intensive, slow, and costly. Technology-enhanced efforts like nutrient-rich seed pods dispersed by helicopter, airplane, or drone can increase planting rates tenfold while cutting costs. But more innovation is needed to scale and sustain such operations, as well as identify and work with landowners to ensure biodiversity.

Trees are the tool of choice for improving the environment and mitigating carbon dioxide, but they have downsides. They take time to mature. While they can store hundreds or thousands of pounds of carbon, they may take a decade to achieve these results. And when burning wood as a biofuel, that carbon is released once more. Innovation can address the slow maturity time – if we plant 100 times as many seedlings, they will absorb carbon dioxide slowly but many more of them are doing so. But still, many argue trees are not enough.

More innovation is needed.

Carbon Capture done artificially through technology is the next innovation horizon to grasp. At-source carbon capture is already in practice around the world, but new techniques such as direct air capture (DAC) are also gaining steam. But DAC requires even more innovation. It is costly, material and energy-intensive, and not yet scaleable.

Direct air capture does the work that trees do, only faster and immediately with no maturity times. If carbon dioxide must be taken from the atmosphere, then environmentalists and regulators alike should prioritize innovation not regulations that restrict carbon dioxide emissions.

With millions of trees being planted through innovative means, carbon being removed from the atmosphere by technology, and innovators thinking up new ways to power homes and vehicles and lower the environmental impact of other processes, there will be no carbon-based environmental or climate concern to speak of. We simply require the innovation.

To achieve the needed strides in innovation and leaps in technological progress, the government cannot intervene. It must allow researchers to try new things, limit costs and regulatory barriers that require substantial compliance, and clear the path for the private sector to compete where profit can be found. Necessity is the mother of invention and profit is the prerequisite for competition. When those are present, solutions and technology will arise. If the carbon concern is as real, significant, and looming as it is said to be, all the government must do is allow natural forces to resolve it – not restrict growth and penalize market actors.


Written by Benjamin Dierker, Director of Public Policy


The Alliance for Innovation and Infrastructure (Aii) is an independent, national research and educational organization. An innovative think tank, Aii explores the intersection of economics, law, and public policy in the areas of climate, damage prevention, energy, infrastructure, innovation, technology, and transportation.