I have rephrased the question as:
“For the research and development of domestic stoves and fuels, what are the best arguments that can be used to justify public funding?
Public funding for R&D reflects established policies of what constitutes something done, “in the public interest.” With domestic stoves, that interest includes benefits realised in one or more of four general areas: public health - broadly defined, access to modern energy, improved manufacturing and industry and lastly, the development of energy resources.
The headline fundraising message has for decades been “a reduction in the fuel consumption”, which falls under the 4th category: “development of energy resources” because in many cases it was viewed as a reduction in the loss of the resource base at an unsustainable rate. The urgency was mainly concern for desertification and loss of forest cover. In China the urgency during the same period was energy efficiency. A few small investments were made in product development and in parallel, numerous projects expanded access to stoves that have established reputations for saving fuel.
As this happened, the idea of convenience, reduced drudgery, a cleaner kitchen as well as fuel saving emerged promoting the concept of “a better life”. The “fuel saving” mantra was not dropped, it was a matter of adding “a cleaner and better life” to the claimed benefits of saving fuel. This approach is perhaps best illustrated by the DGIS (Netherlands) funding of the Access to Modern Energy (AME) programme for several million people (it was defined that way).
The mechanism was to fund, at a rate of $1 per person, the development of “blue sky” stove products (completely original) in projects which cost a total of, for example, $6 per family of 6, and to bring the products to market. This created a very different environment for the developers and promoters of improved stoves because it funded the commercialisation of promising technologies, rather than the roll-out of something with an existing reputation for (only) saving fuel. This AME approach never caught on well in the donor community but I liked it. It is therefore interesting to observe that at present, quite a number of improved stove programmes rely on those models developed during the DGIS–AME period (approximately 2005-2010).
Most recently, the confidence in this approach has been extended within the World Bank’s Clean Stove Initiative in Asia (CSI). It has produced a new set of highly improved space heating and cooking stoves that form the foundation of projects in Tajikistan, Kyrgyzstan and Mongolia, soon to be replicated in South Africa. The support for “blue sly” product development forms a small percentage of the programme cost, but once again, it provides products that already fit into the earlier paradigm of rolling out products already considered to be “improved”.
Projects that are strongly linked to public health benefits, most commonly the reduction of exposure to smoke and lately a reduction to chronic underheating, are structurally the same as the first paradigm: only products with a good reputation (however created) are promoted without any investment in “blue sky” product development and without bringing new ideas with potential to marketable status. It may be the common perception that, amidst so many claims for improvement, the solutions already exist; all that remains is to get them to the users. It is hard to accept amid all the noise that for the most part, they don’t – at least not in a form acceptable to many stove users.
The implicit promise to manufacturers has been: produce better stoves, have them rated, then our projects would be willing to buy them. Products gaining success under this paradigm have been become so on the basis of who funded the development (and owns it), who pushed them with funding (subsidies) and how well the products performed when rated (regardless of the rating method).
It is instructive to realise that the majority of “successful” and widely adopted improved stoves came into being because there was monetary support within the programme for turning them into commercial quality products. Include in this list are stoves such as the Kenyan Improved Jiko, the Thai Bucket Stove and possibly the West African Malgache which is claimed to have originated in Madagascar.
At least two things have skewed the selection of products away from ones that are really good towards ones that are claimed to be really good: big money and inappropriate or even bad test methods. Stoves are frequently promoted by projects run by people not familiar with the sector and accept at face value claims for performance aligned with their goals. We can’t blame them for that. As explained above, fuel efficiency is one metric and the other is access to modern energy (a better life) being a mix of a reduction in fuel consumption and pollutants. Usability and fuel flexibility are less often considered.
“In the public interest” is somewhat different from the “what the public is interest in” if the selection metrics are only those of fuel use and emissions. Performance is far more than discovering how it burns an arbitrary fuel and the measurement of smoke. There is nearly always a mis-match between what the public wants to buy and what public money wants to fund. That discord introduces the other two categories: development of resources and promotion of local industry.
Governments quite justifiably want to manage and expand their resource base. The shortest distance to that goal, plus anticipated public health benefits and access to modern energy, is to promote the development of stoves that everyone want to purchase and use consistently. People already have a stove they like and it needs to be displaced. To displace a traditional stove is no small accomplishment because the new one has to be so attractive it will overcome suspicion, be within range in terms of price and finally, do all the things they want and the new things they wish to do.
The best way to promote such an outcome and to convince a government agency to fund product development may be to point to these two achievements: (1) those game-changing stoves that were significantly better and well-matched to the aspirations of users are often the product of a publicly funded “blue sky” (unconstrained, no preconceptions) research and development effort. That public funding may be direct or through an implementing agent. (2) They always involve deep conversations with the communities of users about what they consider “modern” and attractive and feed that into the R&D programmes. (It does not mean the stove was designed by the community.) Modern energy must be perceived to be so. Whether this can be accomplished by the private sector with an investment in a particular technology is not certain. Producers tend to promote only what they produce using Intellectual Property they control. Researchers tend to promote what they prefer to research.
The World Bank’s CSI Pilot in Central Java provided an interesting blend of private product development, user engagement and behavioural study, with the Pilot holding the centre, negotiating what products fit the desires of the users, defining the performance that met the public health interest of the government, defending the national interest in localisation of products if not already made in the country, and the upholding the reduction of fuel consumption as a noble goal, whether needed or not (there is no shortage of biomass in the project area).
An essential part of that Pilot was the development of a contextual test method that predicted the expected typical performance of the stoves in situ, not the performance based on some arbitrary test sequence. The uptake of about 10,000 improved stoves produced (most are highly improved), distributed and sold by the private sector is an indication that “something is right” with this contextual approach. Some of the highest performing stoves were developed using funds from external grants made without preconceptions, and some of the most popular were developed iteratively by project staff, which amounts to public funding of the product development.
The successful examples of publicly funded product development are sufficient to begin a policy discussion. The WB’s CSI Indonesia Pilot provides a contemporary example with a novel funding option explored.
 It has a complex history of early support from multiple agencies, however the "commercial quality" design and production was funded Appropriate Technologies International, Washington. Additional references available on request. It was initially based on the success of the Thai bucket stove.
 Designed by Robert van der Plas (and others?) in 1982, possibly funded by the Department of Forestry (or ESMAP?) and may have been based on an ancient stove from China.
From my perspective, I believe that the best mechanism for public funding support is research & development grants. Some of these grants could be administered something like the USAID DIV grant model, where the most promising technologies, have the potential to apply for an increased funding level for the next stage of development. Other grants would be either one-time or continuing grants to expand the knowledge & technology base in a certain area.
I am, as I shared earlier, I am convinced that there is much to be gained through investing (not with an eye towards a monetary return but with the idea of making an impact) in applied R&D. Also, I believe that the nature of the problem is on such a scale, that it's important that what is developed is open source, to effect the most rapid and wide-spread implementation. I understand that there are differing views on this,
Areas of research that, I think would be beneficial include:
1. Material Science.
One of the most important and difficult (but often neglected) areas of cookstove design is durability. The seemingly quixotic challenge is how to make an appliance that lasts 3+ years when it is subject to cycles from 10 to 800 deg C, 3 times per day, exposed to both oxidizing and reducing environments, and to liquid spills, along with mechanical abuse and it must be so inexpensive that some of the poorest people in the world can afford to pay for it. Typically higher tech materials are not subject to these kinds of economic constraints. There is some work being done (and has been done) by Oak Ridge National Labs on stainless steel alloys for cookstove applications. This is good work but could use a) more funding, b) more field application (testing is all in the lab in one form or another), and c) the resulting alloy(s) should be made widely available (open source).
A program, probably multiple programs, are needed to develop the best (high durability/cost ratio) ceramic materials for cookstoves. From what I have been able to determine very little has been done in this area. Note that this is not just one material but a family or suite of materials, base on cost - i.e. what is the best that can be material that can be developed for a $40 stove, for a $20 stove, for a $10 stove, and for a $5 stove?2. Usability:
99% of the testing, development, and research that is done to develop cookstoves has been done to optimize emissions, efficiency, cost & to a lesser extent, durability. Comparatively very little has been done to improve the usability of the stove, and yet lack of usability is a major reason why stoves are often neglected and users go back to the 3-stone fire. We are currently doing some research into the effect of fuel tending frequency on cookstove performance. In the laboratory tests, cookstoves are tended almost continuously (fuel is carefully pushed into the stove every few seconds). In practice, cookstoves are tended as little as possible (every 5 minutes or more) and this is one reason why users don't like the more efficient stoves. If they don't tend the stoves enough the fire goes out or at least starts burning outside of the stove. A better understanding is needed as to what can be done, in the way of stove design, to maintain high performance while reducing the frequency that users are required to tend the fuel.
3. Laboratory vs. Field
In the cookstove world, it is almost a cliche, to say that the test results from the lab don't in any way correspond with the test results from the field. This is a huge issue. There is much talk of Tier 4 stoves but if these stoves are only tier 4 in the lab then what is the value of that designation? Also, if stoves are developed under lab conditions that are different from field conditions, is there any reason to think that they are optimized for field conditions? This can be addressed, through systematically studying the differences from field to lab conditions. In general, these are known and include tending frequency (just mentioned), fuel size, fuel moisture, and firing (burning) rate. The better we understand these differences and what their effects are on stove performance, the better we can design stoves that perform well where they need to - in the field.4. Matching stoves & fuel
I often tell people that designing an improved cookstove is not rocket science - it's harder than rocket science. One reason for this is that we are trying to have very good, efficient, & clean combustion when the fuel is highly variable. One opportunity that has not be explored (that I know of) is to design the fuel at the same time that the stove is being designed. By designing the fuel, I mean purpose-grown woody biomass (eucalyptus, pine, bamboo, other) that is harvested, split to size, cut to length and dried. This would add marginally to the cost of the fuel but the energy input would be relatively small and the result would be a consistent fuel that could be burned both efficiently and cleanly in stoves designed to match. The system of fuel production and stove design would be optimized for the highest benefit at the lowest cost.