Energy tech innovation threatened by economy

CAMBRIDGE, Mass.--The outpouring of technology innovation in green technologies could be stymied without healthier financial markets and significant changes to government policy.

Numerous speakers at the MIT Energy Conference on Saturday said the economy and current regulations are barriers to cleaning the energy industry fast enough to mitigate the effects of climate change.

"We see technology innovation completely unprecedented, certainly in my memory, in the technology sector," said Ernie Moniz, MIT professor and director of MIT's Energy Initiative. "We also heard (today) that to get scale-up in time will take more. It will take policy innovation...and business model innovation."

To stabilize greenhouse gas emissions in the next 20 years, the energy industry needs to start investing now in a range of technologies, including renewable energy, efficiency, and underground storage of carbon dioxide, different speakers said.

The problem, though, is that the energy industry moves slowly and is influenced by political lobbying, Moniz said, creating a "large inertial system" that takes time to change.

Also, the meltdown of the financial markets has made building new renewable-energy projects, such as wind farms or solar plants, very difficult. That has created a situation where the government needs to take a more active role in clean energy, argued Theodore Roosevelt IV during a panel on policy. Roosevelt, the great-grandson of President Theodore Roosevelt, is managing director at Barclays Capital and an outspoken conservationist.

"We now have in financial markets something equivalent to an overloaded electricity grid...We have something close to a blackout" because banks are afraid to lend money to other financial institutions, he said. "If we want to see investments in alternative energy, Uncle Sam is going to have to put some money into these."

As a "good Republican and good investment banker," he is wary of government involvement but he said the current situation demands the federal government take the lead on energy projects with industry and possibly states sharing some of the investment risk.

"Diversification of our energy is a good goal in itself. It's prudent risk management. Climate change...we need to try to rise to that challenge," Roosevelt said.

Room for auto start-ups?
The pace of "decarbonizing" the transportation industry is also threatened by the economy, argued John Casesa, the managing partner at Casesa Shapiro Group and a leading auto industry analyst. The recession has dramatically cut revenues at large automakers, a situation that is likely to slow the pace of technology innovation.

"I think it's unstoppable. There's been a societal change in terms of the demand for clean energy," Casesa said in an interview. "I also think, though, that some of this stuff that might have been quickly accepted is going to face a longer adoption cycle because of the economics."

For example, if the large incumbent automakers were allowed to go into bankruptcy, there would be a "big hole to fill" for smaller companies with new technologies, he said.

Casesa predicted that by 2020, the internal combustion engine will still be the dominant powertrain, with electric cars remaining a small percentage of cars.

Hard questions on policy
On policy, many speakers endorsed the basic idea of putting a price on carbon emissions. The Obama administration has called for a cap-and-trade system where big polluters have to purchase permits to emit carbon dioxide. The idea is that the auction will generate revenue that can be used for clean-energy infrastructure and research. Allowing permits to be bought and sold is a market-based mechanism for settling on a price for carbon emissions, say advocates.

"The president has it right: let's do a price signal," said Wayne Leonard, the CEO of utility Entergy, who argued that the United States should take the lead on climate change in global negotiations.

Leonard said that there should be an increase in government-funded research in technology to store carbon dioxide underground at coal plants, called carbon capture and storage.

He warned, though, that carbon regulations will push up the price of electricity.

U.S. Rep. Jay Inslee (D-Wash.), who delivered a keynote talk at the conference, said that creating regulations to restrict carbon dioxide emissions, even if they do increase the price of electricity, is more prudent than inaction.

In an interview with the media after his talk, Inslee said that there are already a number of economic problems being caused by climate change, such as a drop in agricultural production in California because of the drought. Also, in the history of regulation, businesses have complained that the cost of compliance would be too high but, in the end, found technical and business solutions, he said.

"Innovation gives us the possibility that there won't be" an increase in electricity prices from carbon regulations, he said.

Regulations, like those in California that give utilities incentives to be more energy-efficient, could also mitigate increases in the electricity rates, he said. "Even if the per-watt rate went up, your monthly bill may not go up--that's the ultimate issue," Inslee said.

There are legislative efforts under way to pass an energy bill this year that would create a national requirement for renewable energy at utilities. Carbon regulations could also be voted on this year. The exact details on how these policies are structured will make a big difference on how quickly new energy technologies will be adopted, say observers.

"One must say, (we are) only beginning to address the really hard questions on policies," said MIT's Moniz.

[iptofar]

No one is addressing the economic costs of green energy and the distinct possibility that many types of installations actually create more CO2 than they reduce. How would the people feel if they knew under the current administration's policies, their electric bill was about to double or triple?

Policy wonks don't study thermo.

[mrwater]

No one? You must be kidding. Amory Lovins at the Rocky Mountain Institute (rmi.org) has been doing rather comprehensive analyses of that sort for decades.

[kristianna Thomas]

To many road blocks? During the 1980's I kept on top of the developments taking place in the research and development community on "Solar Technologies" in the country. When research was being conducted on technologies in solar; such as trumby walls, and thermal dynamics in materials, passive and active solar, and a whole host of techniques, where was the energy companies then? The research that is being done now is the same research that was done thirty years ago; we should be much further ahead than were we are now. Now these same industries that did not put monies in for R&D are all crying the blues because of "regulations". As in Europe and other parts of the world, they are putting real effort into the development of "alternative" energies, without the excuses that there are road blocks. They claim that a healthy green tech needs a fertile grounds to grow upon, climate change does not wait for a more fertile climate to allow it to change and grow. If these same industries would have put their money where their mouths were we would have the things that we are trying to invent, but they did not and so where do we go from here? I say that climate change is a done deal and we must face that we are reaping what we have sown for the last two hundred years of sowing the whirl wind, when will be face what we have sown? Necessity is the mother of invention. Or, is Frank Zappa the mother of invention?

[sp_graham]

We already have underground storage of carbon dioxide, more commonly called the byproduct of Coal & Oil. So we are going to spend billions to build underground storage to put the byproducts in. Wouldn't it make much more sense to simply start replacing the coal power stations now and get a bigger bang for the buck ????

Likewise stop exporting dollars to the Middle East, Russia and Venezula; how do we do this ? Give the car companies the dollars they need to survive BUT only if they stop making cars and trucks with internal combustion engines, no electric no money from the tax payer and again you get a double whammy by not exporting petro dollars. Want a new car or truck ? There's no need to make any more, there's years and years of inventory and used one around to keep everyone happy in the meantime while the conversion to electric takes place. Let's see Obama wield the carrot and the stick !!!

[bestyj]

New energy ideas are also hurt by the false idea that oil will stay at a low price for a long time.
Truth is once our economy begins to recover and more importanly China , oil will shoot right back up.
We need to make sure we fund new projects that are centered on breakthrough ideas. Only focusing on mainstream alternative nenergy will not solve the problem. I think we need to take another hard look at cold fusion, I recently read about a process called SuperWave Fusion which is showing strong results. Yes we have many financial problems now but we need to make sure we fund new programs
and that will solve our energy problems and help create jobs.

[duggerdm]

It appears that until petroleum really does physically peak (30 years?) and no new technologies can be found (as they have been for the past 30 years) to continue to increase petro production - that not much is going to really change. We will continue to have market manipulation in oil prices - and in reality no one will really know what the world reserves are or the actual cost per barrel to produce petro fuels. Which alternative fuels can't understand their own economic feasibility. We will continue to rely on the word of the totally biased oil producers.

Energy form transition takes decades once it happens - based on the history of animal, steam, internal combustion and electric transitions. The climate change argument doesn't really pose emergency status, rather being more a part of market manipulation strategies. Climate change is always occurring and it's doubtful that man's impacts will actually reverse (though they may extend or diminish) naturalcyclic changes (which we still don't understand) to either warm or cool trends, at least based on the fact that CO2 conditions on earth have been far higher and lower than they are with or without man - and life continued on adapting as necessary.

Our most immediate threats come from un-managed and unsustainable population growth of humans without regard to their finite food resources, the effects of human population density on epidemic disease out breaks (pandemics) and negative human psychology alteration. Crowded humans become rather a rather belligerent lot and highly unpredictable based on observations of past population density disasters. Our real priorities should be reducing the human population substantially while developing an economic system that works without constant growth (as required by our current ideas of socialized capitalism). Actually the economic system that works without growth or in declining market demand makes the energy crisis look like child play. Current slight of hand politics to keep an ignorant population placated will likely continue through our life times and our children will face the same, but much then much more acute population density problems - unless the right bug comes along, or asteroid and makes the changes necessary to give us a second chance on managing our species growth in an intelligent way.

[Nick_the_Greek_Socrates]

"Energy tech innovation threatened by economy"?

Not by the economy.
Curtailed by the old status quo; the establishment and Gov policy.
Triggering exit from California to another country.
Taking all of the disruptive technology to other country.
Creating jobs in another country.
Who trashed-out in-the-box start ups and their tech?
Wondering why?

[Nick_the_Greek_Socrates]

The World needs power, water and food. Wake up World, before is too late. [Or all will be in the mercy of Nostradamus papyrus]. That implies plenty of Super Hybrid Facility (SHF), integrated and in synergy, utilizing back-to-back recovered (free) energy and source. [No single source will be the silver bullet, whether is a coal-fired, or a gas/diesel-fired, or a nuclear, or all other renewable/alternative energy combined, or stand-alone super hybrid seawater desalination plant, or a super hybrid aqua-bio-hydroponic greenhouse].
Rome and the Egyptian Empire were not built in one day. [Today?s state of Regulatory affairs]. What Socrates envisioned then and what Newton subsequently did, is applicable today and for the next four decades. [Dreaming about that novel invention by a magic was the state of the DOE affairs, politically introduced by those to the right for the past eight years, although that curtailment is poised to change, to an extent permissible by the Laws of Physics, Thermodynamics and Hydrology].
Our elected officials finally got their wake-up call, by talking small business and balking at the conglomerates exuberant greed.
In fact, the small business is and it will be the back bone of this country and in the World, as well as the ?Deliverers of Tomorrow?. [Bill Gates, a micron startup then and in-the-box, did deliver out of his garage today?s technological revolution. Today, there are others like Bill micron start-ups, still in-the-box and has invented out of their garages the Science Revolution of tomorrow, however unrecognized].

Indubitably and inevitably, hope soon before is too late, this country and the World will need those micron start-ups, out-of-the-box and respect such as the deliverers of tomorrow, rather than trashing them out, occurrence for the past decade. [Construed as the small business and creators of jobs]. The choice is up to all.