The Innovation Ecosystem

At the Energy Innovation 2010 conference, a number of leading experts on renewable energy, climate change, and sustainable transportation systems like electric vehicles, argued that innovation goes way beyond simple investments in research and development, but encompasses a comprehensive “innovation ecosystem” guided by consumer demand, supply of scientific research and marketable technologies, geographic clusters of firms, and the structures of government institutions. All these factors together will determine if the U.S. can continue to generate “game changing” next-generation technologies that can create more sustainable communities.

Incentivizing Clean Energy Production

Roger Pielke Jr., author of “The Climate Fix: What Scientists and Politicians Won’t Tell You About Climate Change,” says top-down, UN-led negotiations on climate change, which aims at creating global and then national greenhouse gas (GHG) emission targets and action plans, has largely failed. Instead, Pielke argues countries need to go “straight to innovation.” However, even then, there are still issues with setting national targets. For example, the UK “has the most ambitious CO2 target in the world — a 34 percent reduction of 1990 emission levels by 2020, but is finding it won’t be able to achieve this. “It would mean becoming as carbon-efficient as France in the next 2-3 years. The UK would need to add 30-40 nuclear power plants.” Realizing the difficulties, the UK is considering moving back its clean energy production targets.

To truly incentivize clean energy production, current undesirable forms of energy production must be taxed and those taxes must be used to finance the next generation of technologies. Pielke said both India and Germany are leading the way — India is adding a small 30 cent tax for each ton of coal. Those funds are then being reinvested in new energy technologies. Similarly, Germany is taxing nuclear rods because it hopes to move away from nuclear power. Germany is expecting to raise $40 billion for energy innovation.

Devon Swezey of the Breakthrough Institute built on this idea, adding that the “clean energy tigers” in Asia (Japan, China, and South Korea) will outspend the U.S. on government and private investment in energy innovation by a ratio of 3-to-1 over the next ten years. In addition, major global technology and energy firms like IBM, Applied Materials, Intel are now bypassing the U.S. and setting up their clean energy technology labs in China.

To keep these firms’ energy research here, the U.S. must invest in its entire innovation system — not just testing and deploying cutting-edge technologies, but opening and keeping open clean energy power plants and manufacturing facilities. “Manufacturing is part of the innovation ecology. If we lose capacity, parts of the clusters will move overseas.” Overall, panelists argued that increased investments in government energy R&D and investment isn’t enough — there must also be a focus on harnessing the innovation ecosystem and “process innovation” for new energy solutions to become reality across the U.S. 

Getting Americans to Love Electric Vehicles  

Robbie Diamond, President and CEO of Securing America’s Future Energy (SAFE) and the Electrification Coalition, said only in the U.S. are there “more cars than people,” with 1,100 cars per 1,000 people. In China and India, the rate is closer to 9 per 1,000, and even in western Europe, it’s around 700 cars per 1,000. While this demonstrates an incredible car-dependency and explains the enormous demand for imported oil, the amazing number of U.S. cars may also provide an opportunity. Diamond argued that the U.S. could be the key market for electric vehicles just because American families often have 2-3 cars.

Unfortunately, to date, there are only 1.6 million hybrid vehicles on the road, “mainly in niche markets in coastal cities,” and an even fewer number of electric vehicles. Still, Diamond sees electric vehicles as “the killer app” for revolutionizing the energy sector. A host of other applications, including smart meters, could spring up from electric vehicles (see earlier post). Also, the market may be there if costs can be brought down and consumers are better educated about the benefits of vehicles. “Right now, a big stumbling block is that electric vehicles don’t get 400 miles per tank, but most car trips are 10 minutes or less,” Diamond said. Electric vehicles need to somehow connect with consumers.

Transforming the Built Environment

Cathy Zoi, Acting Under Secretary for Energy and Assistant Secretary for Energy Efficiency and Renewable Energy, Department of Energy, plugged her department’s new Better Buildings program, which received nearly half a billion in recovery funds. Better Buildings is about scaling up building energy efficiency retrofits to the neighborhood level. The goal is to create a business model for “neighborhood by neighborhood” retrofits that leverage economies of scale. “We want to get to 5-10 million homes being retrofitted for energy efficiency in the next few years.”

Zoi outlined a story about the creation of Energy Star, which she said came out of the information technology sector and then spread to all appliances. She said the Energy Department saw in the early dates of mass computing that laptop computers shut down automatically, but desktop computers were often left on all night because users feared that their data would be lost. Going to the major manufacturers, Zoi and her team asked why couldn’t desktops also be programmed to shut down automatically. One engineer said, “Oh, this is very easy, but our marketing department didn’t see any point in this so they blocked that feature.” So marketing departments everywhere could see the benefit, the Energy department created the Energy Star logo, which helped “pull the market forward.” Now, with the Obama administration’s more stringent appliance energy efficiency standards, “we will see a $350 billion savings in energy usage.” Zoi said this model — “institutionalizing efficiency so energy efficiency is easier than inefficiency” will be crucial to expanding green buildings across the U.S.

The Department of Defense is taking a similar approach. Dr. Jeffrey Marqusee, Executive Director, Strategic Environmental R&D Program, said defense bases act are “small communities in themselves, with hospitals, stores, housing, and offices.” To address the defense department’s monster energy needs (it’s the largest single consumers of energy in the world), “we’ll need to deploy retrofits over our whole stock of buildings.” One-off green showcases will no longer be enough.

Finding the Game Changers

In addition to electric vehicles, incentivizing new energy innovation, and scaling up energy efficient building retrofits, some government officials are also trying to find the “game changing” energy solutions that will make current technologies obsolete.

Dr. Arun Majumdar, Director, Advanced Research Projects Agency – Energy (ARPA-E), sees the potential rise of “electro-fuels,” as well as energy that uses carbon dioxide as a basic feedstock. In this scenario, the key driver of climate change would instead become the source of new energy. He also said key components of the future smart grid, like an “operating system” and more powerful and efficient transformers, still haven’t been created yet.

Cathy Zoi at the Energy Department said her department’s “Sun Shot” program aims to create a next-generation solar panel in five years that can provide one kilo-watt of energy at 5-6 cents. “We are investing in a new way to do solar.” There was also discussion of small-scale modular nuclear reactors (see earlier post). “The Navy has been using these for a really long-time (in nuclear submarines),” but these could power installations and bring down the cost of reactors. As Dr. Marqusee noted, however, the questions is will local communities want a small-scale nuclear reactor in their backyard?

In future debates on next-generation energy technologies, perhaps there will also be more discussion on what this all means for the built environment and sustainable community development.  For instance, what role can design professionals (landscape architects, planners, environmental engineers, and architects) play in helping communities leverage this coming infrastructure? How can electric vehicle powering stations and smart meters, solar and wind power plants, and retrofitted neighborhoods be well integrated into pioneering sites so demand for them only grows?

Image credit: Electric Vehicle Charging Station, Brooklyn, NYC / Inhabitat

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