Innovation is a key driver in the transition to a low‐carbon economy. Technological change and development will significantly enhance the portfolio of options available and, over time, will bring down the cost of achieving global climate change goals. Governments have an important role in this context. They can help by creating an attractive environment for research, development and demonstration (RD&D) and safeguarding the drivers of innovation. Well‐designed targeted technology policies on both the supply and demand sides are a fundamental ingredient in a strategy to accelerate innovation. While the specific combination of policy measures will depend on country circumstances, in all cases it will be important to set the appropriate framework to allow breakthroughs to happen.

For these reasons, the IEA carries out focussed analysis on best practice in R&D, facilitates cross-fertilisation between basic science research areas and energy research, and supports international collaboration to share costs and increase results.