Abstract:
The importance of investment in Research and Development (R & D) in the energy sector is indisputable
especially considering the benefits of new technologies to sustainability, security and environmental protection.
However, the nature and potential of various energy technologies that are capable of improving the energy and
environmental conditions globally is a challenging task for governments and policy makers that have to make
decisions on the allocation of funds in R & D. To do so, the optimal resource allocation to R & D should be
determined by estimating the social rate of return for R & D investments. This paper aims to estimate the social
rate of return of R & D on various energy applications and technologies such as energy efficiency, fossil fuels,
renewable energy sources, and nuclear for the G7 countries. The results show that primarily R & D investment
on Energy Efficiency technologies and Nuclear are the ones that yield high social benefits for all G7 countries
while exactly the opposite holds for Fossil fuels.
