Energy Technology RD&D Budgets 2019

Tracking trends in spending on research, development and demonstration
In this report

The Energy Technology RD&D budgets database includes data on budgets in national currencies (in nominal and real prices), in USD (at latest year prices and exchange rates), in USD (at latest year prices and PPP) and in Euro (at latest year prices and exchange rates). Also, the database shows RD&D budgets and calculating indicators. The government energy technology RD&D budgets are submitted on an annual questionnaire every year to the IEA Secretariat by appropriate Administrations in national currencies. The exchange rates are published in Main Economic Indicators (OECD) and the GDP and GDP deflators come from the National Accounts (OECD).

Data service and documentation
Overview

In 2018, the estimated total public energy research, development and demonstration (RD&D) budget for IEA member governments reached to USD 19.6 billion (in purchasing power parity, or PPP, terms)1. After four years of decreases through to 2016, total public energy RD&D budget of IEA member countries increased in 2017 by 2% and again in 2018, reaching a level 26% higher than in 2008 but still 5% lower than in 2012, and much lower than the 2009 peak. The 2018 increase was driven by higher budgets allocated to low-carbon energy technologies.

Total public energy RD&D budget for 

In PPP terms, the United States and Japan spent the most on energy RD&D among IEA member countries, followed by France, Germany, the United Kingdom, Canada, Korea, Italy and Mexico. For most of these countries, total public energy RD&D expenditure increased in 2018, except for Korea where it fell by 1%. The energy RD&D budget of the European Union under the Horizon 2020 programme, is larger than that of all but two IEA member countries: the United States and Japan. If the EU budget were added to IEA European countries’ total, the total would rise 42% to USD 8.9 billion (PPP).

Public energy RD&D budgets by country for IEA members and the European union

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The ratio of overall public energy RD&D budget per unit of GDP varied greatly among IEA member countries, ranging from less than 0.1 USD PPP to at most 1 per thousand in 2017. Norway had the highest level in the IEA, with a ratio of 0.97 USD PPP per thousand, followed by Estonia (0.93). Other leading countries were Finland (0.82), Switzerland (0.61) and Hungary (0.54).

Total public energy RD&D budgets per thousand units of GDP by countries for 2017

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Total public energy RD&D budgets by country for 2018 or latest available year

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Over the last 40 years, investment from IEA member countries in energy RD&D has become progressively more diverse. Nuclear power, dominant in 1974 with 75% of total public energy RD&D budget, witnessed year-to-year reductions to reach 22% in 2018, a share comparable to energy efficiency (21%), renewables (15%) and cross-cutting RD&D (23%). RD&D budgets on fossil fuels, which were at their highest in the 1980s and early 1990s, have declined since 2013 (15%) to 9% in 2018.

RD&D budgets for both energy efficiency and renewables grew significantly during the 1990s and 2000s, rising from 7% each in 1990 to 22% and 21% respectively in 2010. However, since then the share of expenditures on energy efficiency has remained almost constant, whilst the share of renewables declined to 15%. On the other hand, cross-cutting RD&D grew in the first decade of the 21st century. RD&D budgets for hydrogen and fuel cells kept their share at 3% since 2012.

IEA total public energy RD&D by technology, 1974-2018

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In 2018, Japan remained the country with the largest RD&D budget for nuclear (USD 1144 million in PPP), hydrogen and fuel cells (USD 216 million in PPP) and other power and storage (USD 201 million in PPP). For the remaining technologies, the United States had the highest RD&D budget. For the United States, almost half of the 2018 energy RD&D budget was allocated to cross-cutting energy technologies1 and could not be broken down further.

The energy RD&D budget increased in 2018 for all types of technology except for “other power and storage technologies”, which decreased by 8%. The increase was 18% for cross-cutting technologies, 25% for hydrogen and fuel cells, 13% for fossil fuels, 10% for energy efficiency, 5% for nuclear and 3% for renewables. 

Energy RD&D budgets by technology in selected IEA countries and the European Union, 2017-2018

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RD&D spending in low-carbon2 energy technologies in IEA member countries saw a significant increase in 2018 to reach USD 18.5 billion (2018 prices and PPP) representing 94% of total RD&D budgets (Figure 7). As total energy RD&D spending, after four years of decreases since 2012, low-carbon energy technologies in IEA member countries increased in 2017 by 3% and again in 2018.

In comparison, spending for non-low-carbon3 energy technologies (coal, gas, oil and other fossil fuel RD&D) remained steady in 2018 at just above $1 billion.

Public low-carbon energy RD&D budget in IEA member countries, 1977-2018

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Reflecting this broad trend, most IEA member countries increased low-carbon RD&D investments in 2018.

In the United States, low-carbon energy RD&D budgets were estimated to grow by 9% with an additional USD 581 million. The second largest increase was in Canada, where low-carbon energy RD&D budgets grew by 34%, amounting to USD 181 million. Mexico recorded one of the largest growth rates increasing the spending by 88% (94 million USD). Japan’s apparent 2017-18 growth was 20%, but this is largely due to data on additional spending by Japan’s Ministry of Environment (0.4 USD billion in 2018) that was not covered in previous years of this database.

Public low-carbon energy RD&D budgets for selected IEA countries, 2017-2018

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References
  1. Does not include USD 1.83 billion of the European Union energy RD&D funding under the Horizon 2020 programme in 2018.

  2. In the current IEA categorization of RD&D energy technologies, low-carbon energy technologies are defined as: energy efficiency, carbon capture and storage (CCS), renewable energy sources, nuclear, hydrogen and fuel cells, other power and storage, and other cross-cutting technologies and research.

  3. In the current IEA categorization of RD&D energy technologies, non-low-carbon energy technologies represent coal, gas, oil and other fossil fuel RD&D. However, CCS is included in low-carbon.