Private-Sector Must Push for Energy Innovation
Norman Augustine, member of the ASP Board of Directors, was featured in a new Bloomberg View opinion piece highlighting the importance of private-sector investment in energy technology.
Success means taking a promising technology all the way to the demonstration of commercial viability. This includes pilot demonstrations, the creation of supply chains, and the ability to reduce costs and meet regulatory compliance. In the energy sector, this innovation journey requires on the order of $1 billion over 10 years. Currently, there is no private-sector mechanism to address this challenge, and promising new technologies will likely die.
A possible solution? To create “Energy Innovation Entities” that will bring important technologies to commercial use. Each Entity would be supported by 10 companies, with each committing $10 million a year for 10 years – a “10-10-10” mechanism. Each Entity would also be run by their own boards in charge of oversight and production management.
Since no single technology would be responsible for resolving energy innovation, spreading the research and development across at least 10 different sectors would be far more successful to find solutions.
The plan would also address the problem of government-funded but private sector technical development programs, where private investors are usually at a loss for evaluating the success of projects. “A private-sector innovation project,” Augustine writes, “if successful, is more likely to result in deployment of technology than a federal one.”
The 10-10-10 mechanism offers a powerful innovation pathway that allows groups of companies to share the risks, costs and rewards without onerous government involvement and, potentially, to greatly broaden the scope and pace of energy innovation in the U.S. and the world. This would be a strategic advantage in a competitive and rapidly changing carbon-constrained global economy.
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