Posts

Surprises and change

The first serious efforts to develop new and renewable energy into viable energy options started in the aftermath of the oil crises in the late 1970’s. The then Carter administration launched multi-billion R&D programmes in the USA to start an alternative energy revolution. Likewise, the first deployment programmes of wind energy were initiated in the USA, which brought some 1 GW of Danish wind power to the Californian market with a hope of producing cheap electricity. At the same time, the first global energy scenarios1 were designed at IIASA near Vienna predicting a turn to an oil-free, mainly nuclear-based energy economy, flavored with solar energy.

In retrospect, many of these early efforts in clean energy were disappointments and didn’t meet the quick promise of turning the world energy economy around. Neither have we been able to foresee the many ‘surprises’ and disruptions that followed during the next 40 years, which together have pushed the new and renewable energy technologies to a market breakthrough.

There is not a single mastermind or grand policy plan behind the success of clean energies, but rather a sequence of interlinked incidences with amplifying effects and making use of enabling drivers such as advances in science and the U.N. climate accords. Not to mention the pioneering markets in Germany with strong policy links which provided generous subsidies to new energy technologies, which in turn induced huge learning effects and cost reductions.

One of the biggest surprises during the last decades was the transformation of China towards an innovation-driven economy. China played a crucial role in bringing down the cost of photovoltaics and wind power. During the last ten years, the price of PV has dropped by more than 90% thanks to the efficient, low-cost, and large-scale Chinese innovation system integrated into manufacturing. In addition, the scale of economies played a role. The Chinese scaled up production facilities tenfold from those typical in the USA and Europe. Remarkably, no major breakthrough in the core PV technology preceded this dramatic cost plunge. This ‘surprise’ came from outside the traditional research and technology development realm, which is often thought to deliver the disruptions.

A similar ‘surprise’ was the victory of the Danish wind power industry, which beat the billion-dollar U.S. wind programme in delivering competitive windmills to the market 40 years ago. The Danish success has been attributed to the effective networking amongst market actors, developers, and researchers, and their openness to share experiences whilst competing.

Some ‘surprises’ may have unpredictable consequences. For example, the U.S. shale gas boom took off in a quite short time period 10 years ago and brought very cheap gas into the U.S. market, displacing coal in power production. These changes were so large that they had a global impact; e.g. cheap coal started to filter into Europe. Unfortunately, the Emission Trading System (EU ETS) was incapable of preventing this and coal use has increased in many EU countries, contradicting the EU climate policy. Ironically, the strong price-driven fuel shift from coal to gas in the USA lead to relative CO2 emission reductions of about the same size as those in the European Union with strong climate and support-driven policies.

Above examples should not be misunderstood as a laissez-faire attitude, but as a cautious remark that future development is not linear. Neither is ‘surprise’ the only factor that created a change, but there are other important factors, many with a socio-economic and political dimension.

Actually the success of PV, wind, and shale gas described above is not just about a mere ‘surprise’, but a result of successful commercialization strategies, in which technology development and deployment measures were optimally applied. Policies played a role in the big picture as well, particularly in accelerating development and providing a framework for penetration. The dialogue between science and policy is also of importance. Scientists have valuable knowledge and insight, and could advise policy makers about future opportunities and threats, and urge actions, when necessary. The recent communication2 on the sustainability of forest bioenergy (policies) by leading European scientists serves as an example of such advice.

In a world of ‘surprises’, it is no wonder that the predictions on the future of new energy technologies include major uncertainties. Once a new technology starts to become cost-competitive and takes off, the future predictions tend to be too pessimistic, while when still being far from the breakthrough point, they are often too optimistic.  A prevailing positive development may also be stopped by a sudden unexpected ‘surprise’. This was the case with nuclear power caused by the Three Mile Island, Chernobyl, and Fukushima accidents, and the consequent rise of public opposition to nuclear and deterioration of its economics, which turned the hailed nuclear renaissance into a disaster, also reflected by recent scenarios3.

Technology disruptions and ‘surprises’ are vital for technology evolution. Therefore, understanding the nature of disruptions deserves attention. The present clean energy transition will trig a range of new innovations, e.g. in transport, in integration of renewable energy, and through digital economy. Consumers are much stronger involved in the change than previously, which emphasizes social innovations linked to digitalization, circular, and sharing economy, among others.

Perhaps the next ‘surprise’ originates from bottom-up movements and not from a specific technology per se, but from using a range of technologies and expertise together to make a systemic change. What kind of a surprise could Artificial Intelligence generate, not to speak about the distant possibility that one day AI >Human I?

Enabling ‘surprises’, not preventing them, may be important for a CO2-free future, meaning that nourishing a multitude of agents and ideas, which may lead to disruption, would be welcome. The inertia of energy economy is known to be large; it involves huge investments and conservative players. Here, governments may help by unlocking the lock-in to the past energy and avoiding path dependencies. Giving due attention to enablers, drivers, and pushers, which accelerate a change, is worthwhile. Understanding technology limitations is also useful, but we shouldn’t undermine the human ingenuity to overcome such obstacles.

 

  1. Jeanne Anderer, Alan McDonald, Nebojsa Nakicenovic, Wolf Hafele (Ed.). Energy in a Finite World, Paths to Sustainable Future, Ballinger Publishing, 1981.
  2. EASAC – the European Academies’ Science Advisory Council Multi-functionality and sustainability in the European Union’s forests. EASAC policy report 32, April 2017.
  3. International Energy Agency (IEA). World Energy Outlook 2017, November 2017.

Peter D. Lund is professor at Aalto University in Finland. He chaired the Advisory Group on Energy of the EU in 2002-2006. He is past chair of the EASAC Energy Panel. He also holds several visiting positions in China.

Professor Paul Ekins presents at COP23 side event in Bonn

On 11 November, Professor Paul Ekins, Project Co-ordinator of INNOPATHS, was invited to speak at a COP23 side event session titled ‘Low Carbon Europe 2050 – The vision and beyond’.

The EU is set to reduce GHG emissions by 80-95% by 2050 and plans to bring a new long-term climate strategy on the table in 2018. Professor Ekins’ talk was part of a session which covered insights from ongoing H2020 and other research on low carbon transitions, ranging from the essential elements and scenarios to exploring future strategies and governance frameworks.

Three other short introductory presentations were given by Jürgen Kropp (PIK) on EUCalc as an analytical tool and experiences from policy interaction, Lars J. Nilsson (Lund University) on low-carbon Europe, and Guido Knoche (UBA) on the role of science and research. These introductory presentations led to an interactive scholarly debate between a panel and the audience on ways forward and the role of science in shaping policy and governance frameworks.

The panel discussed mitigation options and pathways, key opportunities, barriers and lock-ins, policy and governance implications seen from research, and the roles and responsibilities in science-policy interaction and co-design.

The event was organised by the German Federal Environment Agency and Lund University and co-organised by University College London, Potsdam Institute for Climate Impact Research, Ecologic Institute, Fraunhofer Institute for System and Innovation Analysis.

For an overview of the event, please click here.

Sociotechnical transition for deep decarbonization

Rapid and deep reductions in greenhouse gas emission are needed to avoid dangerous climate change. This will necessitate low-carbon transitions across electricity, transport, heat, industrial, forestry, and agricultural systems. But despite recent rapid growth in renewable electricity generation, the rate of progress toward this wider goal of deep decarbonization remains slow. Moreover, many policy-oriented energy and climate researchers and models remain wedded to disciplinary approaches that focus on a single piece of the low-carbon transition puzzle, yet avoid many crucial real-world elements for accelerated transitions (1). We present a “sociotechnical” framework to address the multi-dimensionality of the deep decarbonization challenge and show how coevolutionary interactions between technologies and societal groups can accelerate low-carbon transitions.

Written by Frank W. Geels, Benjamin K. Sovacool, Tim Schwanen and Steve Sorrell 

Read the full publication online

Uncertain Innovation – Guiding Public R&D Investment Decisions for the Low-Carbon Transformation

How to integrate uncertainty into public energy R&D investment decisions, and what comes out of it? 

On 9th May 2017, Prof. Erin Baker (at UMass Amherst), Prof. Valentina Bosetti (at Bocconi University) and I published an article in Nature Energy entitled ‘Integrating uncertainty into public energy research and development decisions’.

In this paper, we analyzed a range of studies and expert reports on public energy Research and Development (R&D) investments considering uncertainty to uncover common threads and trends. Figuring out where to invest dollars or euros to best spur innovation is difficult. Because of this, we outline the elements of a decision making framework, pulling together the current state of knowledge on cost-effective R&D investments across a range of energy technologies. We also identify energy technologies that appear to be “win-win bets” across a range of expectations about costs, integrated assessment models, and decision methods.

We found that public R&D investments into new ways of storing electricity and capturing carbon to store underground should increase, as both technologies provide flexibility in the energy system. Utility scale electricity storage allows for the increased integration of often-intermittent renewable energy sources into electricity grids. Carbon capture and storage (CCS), provided it is delivered in a widely-applicable commercial form within a reasonable timeframe, allows a little ‘breathing space’ in addressing climate change, as it can reduce emissions from coal power, which remains a major contributor to CO2 emissions and an important source of power in countries with growing energy demands.  When used in conjunction with biomass-fired power plants (using sources such as wood pellets or corn stover), it can produce ‘negative’ emissions, sequestering the CO2 the biomass drew from the atmosphere whilst the biomass was growing.

We also found that the proportion of R&D funding devoted to solar power as well as advanced batteries for use in low-emission vehicles should also increase if R&D budgets decrease (even though research shows that investments in low-carbon R&D should increase, decreasing R&D budgets are a real possibility given recent developments). Solar power has huge potential, and low-emission vehicle technologies – particularly better batteries for electric vehicles – will allow us to reduce emissions from transportation, which now makes up a quarter of the US greenhouse gas emissions.

These findings are relevant for the second ministerial meeting of the Mission Innovation initiative, which will be held in Beijing on 6-8th June 2017, partly to discuss the future focus of energy technology investment. Mission Innovation is a global initiative comprising of 22 countries and the European Union, which aims to “dramatically accelerate clean energy innovation”. As part of the Initiative, launched at the Paris climate change conference in 2015, participating countries committed to doubling their clean energy R&D investments over five years.

It is important to note that the studies analyzed consider the fact that public R&D investments help economies by reducing energy costs and by reducing emissions that are damaging the environment, but they do not account for additional benefits of R&D, including reducing the health costs from outdoor air pollution and in some cases creating new industries or making old ones more competitive.  We hope that this work managed to pull together research that can help Europe to continue to address climate change meeting the pledges made by many of the current EU countries, including the UK, to double public energy R&D investment while increasing competitiveness through good bets on energy technologies.

By Laura Diaz Anadon, University Lecturer (Assistant Professor) in Public Policy at the Department of Politics and international studies at the University of Cambridge