Comments by Alan Nogee Subscribe

On Efforts to Promote Energy Storage Should Look to the States

Interesting. This article would be much more helpful, though,  if the author gave some specific examples of how local regulation was in appropriately blocking storage. I wouldn't immediately dismiss the viability of federal legislation. While the title and popular belief is that storage primarily benefits renewables, it also benefits inflexible baseload capacity--especially coal and nuclear--which might otherwise have to ramp down in low load conditions, and may even provide higher economic benefits to them. Successful efforts to harmonize state and local regulations on electricity issues, on the other hand, are few and far between. 

Alan Nogee

@alannogee

On The Future of Global Climate Policy: Clean Energy Innovation Imperative

Matthew,

And thank you for the original series and the response. Glad we're debating this as relative priorities and not absolutes.  Have you seen the recent Kennedy School Belfer Center paper on innovation by a team of serious innovation geeks? They also recommend increases in the range of 3-10x for specific technologies, with an overall increase of about 4x (which would basically mean continuation at the level of funding under the ARRA stimulus bill).  Interestingly, their survey of experts in each of a range of technologies also found, though that:

[E]xperts also expressed the opinion that there are points of diminishing returns for investments in each technology—that increasing funds well beyond this particular amount in the short term may not result in significant benefits.

I also agree that our current policies can be improved. A few years ago, I tried to persuade an industry association to propose a long-term tax credit that would phase out if natural gas prices exceeded a certain level.  At the time, gas was above $10/mmBTU, and they would have received nothing. The Congressional Budget Office would have scored it as having no cost. But they were confident that they could get a renewal under the status quo.  Now, of course....

Depite this hopeful convergence, I do want to point out that deployment at the rate and scale needed to reduce costs quickly and reduce emissions rapidly will require multiples this amount of funding--likely far more than can be expected from government sources, as opposed to internalized in energy prices through a renewable or clean energy standard, cap and trade, taxes, or something else. I hope that ITIF and the BTI increase efforts to emphasize the commonalities with groups promoting deployment.  

Thanks. 

Alan

On The Future of Global Climate Policy: Clean Energy Innovation Imperative

Excellent series.  I'm in strong agreement with the bulk of it.  I continue to think, though, that you are overstating the role of R&D relative to deployment.  I reviewed the key Nemet reference you cite for the proposition that cost declines are the result of "equal parts ongoing R&D and economies of scale" and do not believe it supports that conclusion. 

Rather, Nemet concludes that 30 percent of the total price decline of PV is from improving cell efficiencies, of which R&D is the primary driver, although learning by doing is credited with "some" contribution to increasing cell efficiency as well. So R&D contributes roughly one-quarter of the overall price decline, rather than half.

More than half the decline is directly attributed to factors related to growth in the market for PV cells, especially larger manufacturing plant sizes (43%), but also learning by doing, standardization, market predictability, competition, etc. These are all factors that deployment policies, such as renewable standards and incentives, aim to effect. 

Nemet attributes 12-15% of the price decline to spillover effects from the IT industry in reducing silicon price and usage.  But it is interesting to note that around the time the paper was written (2005) was when PV price decreases halted as a result of a silicon shortage.  Up to that time, the PV industry largely utilized silicon waste from the IT industry. The huge decline in PV price since the paper was written has been largely driven by the creation of large dedicated silicon plants to serve the PV industry. Those plants, of course, were enabled by the large expansion of the PV market--driven by deployment policies. 

Even within the R&D contribution, Nemet finds that industry was responsible for 6 of 16 key breakthroughs. The other 10 breakthroughs were from universities and government research. The increasing scale of the industry likely contributed to industry's ability to conduct such R&D, and I would expect industry to play an ever larger R&D role as its scale increases. 

While Nemet looks only at PV, he also cites a paper (Madson et. al.) that found that scale made an even larger direct contribution (60%) to price reductions for wind energy, vs. 43% in direct scale effects Nemet found for PV.

Finally, the specific example you provide to illustrate the high cost of deploying with yesterday's technology makes no sense. It is not meaningful in any way to multiply 30 year old costs times a target penetration rate to calculate the cost of deployment. Every technology has to be ramped up over time, and in that process of ramping up costs will decline due to scale, learning, etc. That is the whole point. 

Bottom line: yes, government and university R&D has a very important role to play in the innovation process. I strongly agree with the many recommendations that it should be at least doubled. But it is significantly overstating the case to assign it an equal or dominant role in the policy portfolio. 

Alan Nogee,

Clean Energy Consulting

@alannogee

On Wind Energy Does Little to Reduce CO2 Emissions

I haven't yet reviewed the referenced articles, so this is a very preliminary response.  

The article repeatedly cites studies on increased emissions/kWh, but is ambiguous about whether the studies refer to emissions/kWh of the balancing generators--which would not be at all surprising--or whether they refer to emissions/kWh of the overall electricity system. The article implies the latter--that wind is making the system dirtier--to the casual reader, but never shows it.

The critical question is whether the increased emissions/kWh of the balancing generators more than offset the emission reductions from wind substitution for the fossil generators. I would be surprised if this were the case, since that finding would contradict many previous studies. At a minimum, the author and editorial board should make sure that the article is clear on what is being claimed. Thanks. 

@alannogee