Charlie WilsonSolar-powered flying skateboards: Central to your typical 8-year-old’s vision of a climate-friendly future, but, alas, destined only for the world of science fiction.

But all is not lost. Many other forms of energy technology innovation lie squarely within the realms of science. And scientists working on how to address climate change see innovation as key to addressing climate change.

The question is how do we innovate successfully? The history of energy innovation is littered with over-exuberance, pipe dreams, and white elephants. But it’s also marked by striking successes, such as the world-leading Danish wind power and Brazilian ethanol industries, or the energy efficiency of Japanese consumer products.

Our new book scours the pages of history to work out what has distinguished past successes from failures. We cast a critical eye on twenty varied innovation histories of energy technologies, from large to small, old to new, and supply to end-use. We are interested both in the technologies that now dominate our landscape as well as technologies that have faded from public view.

Our motivation for the book was to find out: how can we innovate successfully to address climate change? We don’t come up with all the answers, but we do think we can point the way.

A systemic perspective on energy technology innovation

Successful innovation is like a puzzle: you need all the pieces to see the whole picture. But history shows us that innovation policy, research, analysis, and market activity have too frequently focused on a particular piece of the puzzle.

Research and development (R&D) is a good example. Energy-related R&D activities are dominated by private firms. But governments play a crucial role in supporting and investing in R&D with less immediate prospects and less certain pay-offs. When we looked at the history of R&D, we found that public R&D efforts often targeted early and rapid upscaling of promising new technologies. This was particularly the case for energy supply technologies, including wind turbines, solar thermal plants , synthetic fuels, and nuclear power.

Building big can help reduce costs. But cost reductions from upscaling are by no means guaranteed. They depend on all sorts of other things: experimentation and testing, often for prolonged periods; entrepreneurs trying out applications in different market niches; early adopters demonstrating its advantages; underlying investments in skills, training, and human capital; shared expectations around a technology’s prospects; mechanisms to share and exchange knowledge about what works; a consistent market environment without cyclical or stop-start activity that leads to turnover in workforces and the loss of acquired knowledge.

These are just some of the other pieces of the puzzle, elements of the broader innovation system. The cost reductions sought by policymakers and technology developers may be the corner piece that holds the rest together. But it doesn’t make a picture on its own.

This is why advocates of an Apollo program or Manhattan project for low-carbon technologies are wrong. These historical examples of singular science-led R&D programs are poor analogues for what’s needed in today’s energy market environment, with discerning consumers, profit-seeking developers, and cash-poor governments.

We need silver buckshot not silver bullets, diverse portfolios of options not one-shot, large-scale panaceas. Diversity means entrepreneurialism, risk-taking, variety, and experimentation in technology development, learning processes to sustain performance improvements through market deployment, and support for and protection of niche markets by public policy. More and more pieces of the puzzle.

Learning from history

Our book identifies the hallmarks of historical innovation successes and sets out how we can apply these lessons towards a low-carbon future. We put the puzzle together to reveal the picture of a comprehensive yet simple framework for analyzing energy technology innovation.

An innovation systems perspective makes transparently clear that successful innovation is founded on effectively functioning innovation systems. An inter-dependent mesh of knowledge, institutions, use, and resources that cohere to support new technologies through development and out into the market. With a critical role for consistent, continuous and aligned policy support for all the elements of the energy system.

That corner piece? Well, it’s an important piece of the puzzle … but it’s only a piece.

Charlie Wilson is a lecturer at the University of East Anglia and led the UK Energy Research Centre VERD project. The book ‘Energy Technology Innovation: Learning from Historical Successes and Failures’ is edited by Arnulf Grubler and Charlie Wilson, and published by Cambridge University Press. It’s available online here.


Jim Watson

The costs of shifting to a low carbon energy system have become particularly contentious over the past twelve months. Most of the debate has focused on rising energy bills, and the extent to which costs of climate and energy policies are impacting on industrial competitiveness as well as household budgets.

Whilst these costs are undoubtedly real, their impact on consumer bills has often been exaggerated. The main driver of the increases we have seen since the mid-2000s has been rises in wholesale gas prices. Furthermore, analysis by the government and their statutory climate change advisers (the Committee on Climate Change) suggests that future increases in bills to pay for the low carbon transition are likely to modest. Assuming that ambitious energy efficiency goals are met and gas prices remain high, these increases are likely to be much lower by 2020 than they would be in the absence of strong climate policies.

Today’s report by Cambridge Econometrics for WWF UK adds an important and welcome dimension to this debate. It broadens the discussion from energy bills to the impact of low carbon policies on our economy as a whole. It addresses important questions: What will climate change policies mean for growth and jobs? Who will be the winners and losers?

Assessing these economy wide impacts is far from easy. As a forthcoming report on ‘green jobs’ from the UK Energy Research Centre (UKERC) will show, such assessments are fraught with methodological difficulties and uncertainties. Whilst the evidence base is patchy and mixed, the UKERC research has identified some evidence that renewable energy and energy efficiency are more labour intensive that some fossil fuel technologies.

An important argument that is made in the WWF report is that investment in a low carbon energy system makes particular sense for today’s UK economy. Unlike many other assessments, the modelling that underpins the report does not assume that we have full employment. UK unemployment may be falling, but the rates of under-employment (part time working) and job insecurity remain high.

Against this background, the report shows that meeting the UK’s first four carbon budgets, which have now been legislated, could create much-needed jobs and help to rebalance our economy. It concludes that an additional 190,000 jobs could be created by 2030. Although such estimates are always subject to uncertainty, this illustrates why a low carbon transition should not only be discussed in relation to its impact on our emissions. It could also help to bring about a fundamental shift in the goods and services the UK economy produces.

Even if the overall picture is as positive as the WWF report concludes, there will be winners and losers as a result of the UK’s low carbon transition. These ‘distributional impacts’ are often given too little attention in economic assessments. They are crucial since they help to explain why the debate about our energy future has become so contentious and political. Whilst the Cambridge Econometrics analysis is a result of particular assumptions, it suggests that meeting the UK’s carbon budgets will be beneficial for many economic sectors, including direct benefits for those involved in renewable energy and energy efficiency. It also concludes that there will be negative impacts on natural gas suppliers and oil refiners. Interestingly, the report also finds that there will be net benefits for energy intensive sectors because of higher demand for their products from manufacturers of low carbon technologies.

Whilst this may be the case, the report’s positive conclusions tend to underestimate the political challenges of dealing with incumbent interests that have the most to lose from a low carbon transition.

The report rightly emphasises the need to address the needs of those consumers who are least able to pay their energy bills. Rates of fuel poverty in the UK remain very high in comparison with those in other similar countries, partly due to the poor state of our housing stock. Once again, the report finds a broadly positive picture. It concludes that, on average, they will be better off due to higher levels of energy efficiency and gains due to additional employment. But even if these gains are realised, the government will need to redouble efforts to ensure that the fuel poor are targeted first with energy efficiency measures. Ironically, one of the main impacts of the recent controversies over energy bills has been a reduction in the levels of ambition for household energy programmes.

Jim Watson, is Research Director at the UK Energy Research Centre.

BarrettIn proposing a 30% rather than a 40% energy demand reduction target, the European Commission is increasing the risks that European Union member states face from fossil fuel dependence and slowing the economic and social benefits of better insulated homes and lower energy bills.

The EU should have the courage to adopt a legally binding target of 40% energy savings by 2030 as was originally proposed. This would ensure that all member states introduce effective energy efficiency policies and would reinforce the EU’s leadership role in reducing carbon emissions and preventing dangerous climate change.

The proposed 30% target suggests a weakening of political commitment. Several studies have shown how the technology and strategies are available to achieve more ambitious reductions without imposing a burden on the economy. For example, there are already cars currently available that are 40% more fuel-efficient than the current EU standard – and changes in design and materials can reduce emissions by more than 40%.

A legally binding 40% target would potentially reduce EU gas imports by up to 40% compared to 2010, roughly equivalent to the amount of gas currently imported from Russia. It would reduce household energy bills through improved energy efficiency, lowering levels of fuel poverty and reducing the effects of poor-quality housing on health. And it would reduce the scale of investment in renewable energy infrastructure by reducing energy demand.

A binding target would ensure political commitment to the task of developing effective energy-efficiency policies and provide long-term confidence for investors delivering commercial goods and services for energy efficiency. It would also drive innovation in energy-efficient products, opening up market opportunities for EU industries around the world.

Why adopt a target as well as energy efficiency policies? Improving energy efficiency is the cheapest and fastest way of reducing carbon emissions, while at the same time providing economic, social and environmental benefits. Without an ambitious overall energy-efficiency target it’s unlikely that member states would unlock these benefits. Nor can these benefits be achieved through the carbon price delivered through the EU emissions trading scheme.

An aggregate target helps ensure that energy savings in one area are not offset by the rebound effect of increased energy demand in another. A legally binding target at the EU level would help ensure that progress is monitored, action is taken and results achieved. None of this is incompatible with the emissions trading scheme provided the appropriate steps are taken to ensure a minimum carbon price.

A 40% target is within our grasp, technically and economically, and would send a strong message that EU intends to lead on these issues. Regional instability in North Africa, the Middle East and now Ukraine has shown time and again that over-reliance on imported fossil fuels makes countries vulnerable to price shocks and supply interruptions.

We need to reduce those risks and at the same time protect the climate. Improved energy efficiency comes top of the list for cost-effectiveness and wider benefits. Recent progress has demonstrated that significant reductions in energy consumption can be achieved while maintaining productivity and quality of life – UK energy consumption fell by 12% between 2000-2012, while GDP increased by 58%.

Improvements in technology and changes in behaviour will make a 40% reduction by 2030 not only desirable but entirely achievable. But it must be backed up by political commitment.

This article was originally published at The Conversation. Read the original article.

John Barrett is Professor of Sustainability Research at the University of Leeds. He is also a Co-Director at the UK Energy Research Centre (UKERC). Andrew Smith is Academic Head of the RCUK Centre for Energy Epidemiology at University College London. Steve Sorrell is Senior Lecturer, Science Policy Research Unit at University of Sussex and a former researcher at the UKERC.

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