TennTradition
Defended.
- Joined
- Aug 14, 2006
- Messages
- 16,919
- Likes
- 822
Hey TT, could you give us the quick and dirty version of what this is about and what you expect from it? (no, I won't hold you to the second part. Just a learned guess will do fine)
OK...this is long..my apologies...I know these long posts can be thread killers....
It is exciting to me because DDCF has made it possible, for the first time as far as I can tell, to conduct a large-scale, highly-involved study of energy innovation systems.
The study isn't going to really examine specific technologies - or make recommendations in that respect - instead, it is focused on evaluating, assessing the performance of, and making recommendations for the energy innovation infrastructure in the US (and also where possibilities exist for international cooperation in the innovation stream).
The specifics are still being held under wraps as far as any official results go - and mainly because there is still a lot of research going on. But, in general, there are some aspects that will get a fair amount of consideration.
The over-reaching questions are what combination of demand-side macro-pricing and supply-side technology supply innovation schemes must be applied for energy innovation. There are currently both demand-side (e.g., cap-and-trade legislation of lieberman-warner, waxman, etc.) and supply-side attempts out there (Energy bill, economic stimulus). But, the issue is that it is hard to imagine a demand-side scheme working very well unless there is an effective innovation system in place, which there isn't. Compared to biotech, IT, etc. ... energy is absolutely horrible at corporate investment into R&D. So, this means that getting an effective supply-slide system in place first would be very important.
How to do this in a technology-neutral and flexible way such that we do not lock into specific technologies too early are key questions when looking at how to structure the innovation system. Congress must find a way to stay out of this so that we don't have more ethanol fiascoes.
One general system that I have seen proposed (Bonvillian and Weiss) would be:
Classify energy technologies according to likely pathways of launch (e.g., experimental technologies, disruptive technologies into niche markets, secondary innovations with uncontested launch, component innovations with contested launch, or energy efficiency).
Match policy packages to pathways of technology launch.
Do a gap analysis of innovation system (this is where Lester's study will be very useful, in my opinion).
Plug gaps between existing institutions for stimulating innovation in energy technology.
So, the key question is how does one plug these gaps that Lester's and others' studies will identify. Bonvillian and Weiss suggest that a combination of approaches will be necessary, all aimed at avoiding a federal command-and-control perspective. Examples include an ARPA-E framework like DARPA used to spread money to promising sectors in a technology neutral way (though I will say that critics argue an ARPA model will not work here). Also, they propose a wholly-owned government corporation that will:
share the financing of carefully monitored demonstrations of technology,
encourage and provide incentives to industry consortia,
speed scale-up,
finance energy efficiency gains, etc.
I've talked more about Bonvillian and Weiss here than Lester's study - but that is mainly because their results (published in a book) are out and Lester's aren't. But, Lester and his research team are at the point now that they are looking seriously at these technology pathways and thinking hard about the merits of the launch model proposed by Bonvillian and Weiss as well as other innovation models. It would surprise me if Lester's study concludes that an ARPA-E model should be applied - instead, I see the wholly-owned government corporation approach being combined with leaning on well-coordinated regional innovation clusters.
As far as the prospects - this is a huge problem. America is a "covered wagon culture" as the old saying goes. We're really good at deciding we don't like where we're at and moving into a new area and making great things happen there. We're not so good at coming back across the mountains and bringing lessons learned in the new area to improve our old neighborhood (i.e., energy). When this is paired with an industry as huge as energy (2 trillion dollars or so), you are presented with a significant challenge.
The energy industry and its investors are so used to having such a low R&D investment (I think that it is around 3% historically), I think that the government will need to be willing to make significant investments - though many here may argue with me on that. I think that the key is to act quickly on supply-side innovation schemes, because if demand-side legislation is passed in the current economic situation without a supply-side system in place, we are going to have some big problems.