Update Sept 2: Bill Gates has responded at Dot Earth
Andrew Revkin is hosting an interesting discussion at New York Times Dot Earth right now on energy innovation policy. It began with a post about Bill Gates’ recent interview with MIT Technology Review, which focused primarily on energy, and a rebuke from one commentator, Richard Rosen, in “A Challenge to Bill Gates on Energy Research.” Revkin encouraged discussion in an email to several experts, and this was my initial contribution. Bill Gates is apparently offering a response at Dot Earth tomorrow, so stay tuned:
The White House recently released its report on how ARRA is promoting innovation, particularly in solar PV, batteries, and DNA sequencing. ”Near-term improvements will be able to cut the cost of solar power in half, as second generation thin-film solar panels such as the rapidly emerging CIGS and Cd-Te technologies compete with ever improving traditional silicon-based panels,” the report noted. “Beyond that, breakthrough technologies could make solar as cheap as new fossil fuel plants without government incentives.”
This assertion stands in direct contrast to one of Richard Rosen’s most basic assumptions, which is that it is thermodynamically infeasible for low-carbon electric generation technology to provide electricity as cheap or cheaper than coal-fired power plants. Secretary Chu’s own assessment that we need several Nobel-caliber level breakthroughs to make low-carbon energy cheap enough to compete also stands in contrast. I think we can assume that Secretary Chu understands the second law of thermodynamics! (As well as Dr. Holdren and his team, for that matter, who I’m sure played an important role in the White House report).
What’s more important than the question of whether major price reductions are achievable is how we achieve them as rapidly as possible. The importance of technology-pull in combination with technology-push is well understood among innovation economists, but it’s not clear that Gates yet understands the pull. It’s true that he will passingly mention the need for demonstration, but it’s more of an appendage to his larger R&D theme, and he almost entirely ignores the need for direct deployment and procurement.
Making a powerful case in Nature for direct federal procurement and deployment of low-carbon energy technology, John Alic, Dan Sarewitz, Bill Bonvillian, and Chuck Weiss recently argued, “government R&D by itself, almost regardless of its scale, cannot foster innovation on a broad front… Government purchases of integrated-circuit chips in the 1960s fostered advances in microelectronics at least as much as did government-funded R&D.” So while Gates’ overall emphasis on the need for innovation and price reductions is very important, and represents a larger shift occurring in the climate and energy consensus, I would agree that he puts too much emphasis on R&D.
With that said, procurement and deployment policy needs to be better designed to achieve price reductions, and not simply aimed at subsidizing already-mature technologies (which can actually increase barriers and reduce the incentive to innovate, a dynamic we’re seeing play out in parts of China right now). Feed-in tariffs and RPS policies don’t address this problem. The CEDA proposal included some provisions along these lines, but there’s much more work to be done on this front here and abroad. If Gates can take his overarching logic and apply it to the broader innovation chain, well then we’d really be onto something.
See also:
