At yesterdays’ FP event, Sen. Richard Lugar and Tom Friedman both mentioned several ways in which the US government can embrace alternative energy sources, not only for their impact on oil dependency, but also for their potential marketability in the years ahead. “Since everyone’s going to want these products, someone’s going to invent them, and it might as well be Americans,” the argument goes. 

One good step in that direction is the passage by the House this week of a bill designating the “H-Prize.” Similar to the Ansari X Prize, given last year to the developer of the first privately funded rocket program to send a man into space, the H-Prize will provide cash rewards for advances in hydrogen vehicle technology. At $4 million, the grand prize may be a drop in the bucket, but it will still provide incentives for smaller developers and venture capitalists to push forward new technology. The X-prize was won by a small start-up backed by Paul Allen, who may not have been as willing to invest or compete if there wasn’t the prospect of massive publicity at the end of the line. Both Washington and the Big-3 auto makers have been criticized for being slow to capitalize on alternative-fueled cars. Broadening the field to encourage innovation may be the best strategy for pushing forward alternative-fuel technology. 

[hat tip: MarginalRevolution]