Aspen Ideas Festival: Fueling incentives for renewable energy worldwide

Aspen Ideas Festival: Fueling incentives for renewable energy worldwide

Summary: The global population is supposed to increase by two billion people by 2050, so the clock is ticking on financing and producing new renewable energy models.

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ASPEN, COLO. -- Despite a surge in public interest a few years ago, governments worldwide have slowed down (some to a virtual standstill) with transitioning to renewable energy sources, according to some of the leading minds at research and government agencies.

During a panel discussion on Friday at the 2013 Aspen Ideas Festival, leaders from Thomson Reuters, the National Renewable Energy Lab, and the Energy and the Environment at the Council on Foreign Relations attributed the drop in interest to the decline of gas prices and related incentives.

There's also the issue of getting governments, financial institutions and other sources of wealth and power just to invest.

That isn't to say all hope is lost.

I sat down with David Brown, head of the IP Solutions business at Thomson Reuters, and Michael Levi, a senior fellow for energy and the environment at the Council on Foreign Relations, on Saturday, who discussed the incentives being brainstormed and debated around the world.

Brown remarked that we are experiencing a "macro-level convergence" of technology, policy, and finance. The problem to be solved, he suggested, is getting those three levers to work together to produce successful renewable energy solutions and measures.

Naturally when dealing with newer technologies and infrastructures, there is no right answer -- at least not yet.

Brown said that each country is handling renewable energy in different ways, albeit with varying degrees of success.

He specified that the difference between the United States and foreign institutions is that the U.S. is more "short-term in nature" with a tax-credit driven approach. Other governments, he continued, are looking at energy policy with a 25 to 50-year viewpoint.

"When it comes to climate change, you need a shorter-term plan," Levi argued. "If we wait 200 years to deal with climate change, we're toast."

Still, a short-term approach might not being anything to shake one's head at.

"When it comes to climate change, you need a shorter-term plan," Levi argued. "If we wait 200 years to deal with climate change, we're toast."

"Literally," Brown quipped.

The simple answer might be that governments worldwide need to draft both short-term and long-term plans for renewable energy development.

Brown cited a Thomson Reuters forecast that the global population is expected to grow by another two billion or more by 2050. Thus, energy consumption would then increase that much more greatly.

Levi lamented that the sad reality is most of those two billion citizens won't have access to renewable energy resources, which is another development challenge.

As author of the recently published book The Power Surge about energy "revolutions" in the U.S., Levi asserted that the problem -- at least in the United States -- is that long-term planning often derives into a lot of backlash, and proponents end up with a lot less than what they wanted.

Then with funding, Levi described that five years ago, venture capitalists were "supposed to take us to next stage of renewable energy technology."

But reality hit when everyone realized they would need to wait anywhere between 10 to 20 years to actually make money on the investments.

"We had to establish a financing vehicle to promote that this is a worthwhile place to park cash for 15 to 20 years," Levi said, joking that it would "be great if you could invent a way to finance invention more effectively."

Then there's the debate over government versus private financing, or some hybrid business model. Levi listed a few examples of government agencies jointly funding renewable projects with private firms, notably in the United Kingdom as well as the state of Connecticut.

Levi said there is talk about such a model at the federal level. Using Tesla as an example because the electric vehicle maker paid its government loan back early, Levi posited that it would have been great if that return was redirected to another energy project that needed it rather than just being poured back into a general fund.

Nevertheless, Levi admitted he doesn't think we'll see a "green bank" any time soon.

Levi continued that this is a sector where we need to take risks (financially speaking), but private equity often won't take those risks either.

"We have to establish a financing vehicle to promote that this is a worthwhile place to park cash for 15 to 20 years," Levi said, adding that it would "be great if you could invent a way to finance invention more effectively."

Topics: Tech Industry, Government, Government US, Legal, Start-Ups

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5 comments
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  • Governments are still fueling dinosaurs.

    As long as they keep sending money to coal miners, gas drillers and other energy source providers (aka the dinosaurs), we will never see a turnaround into renewable or clean nuclear.

    That's not to say that sending money toward renewable energy providers is a good idea either, because all that would do is create new dinosaurs.

    The only place governments ought to be sending money related to energy is in the purchase of energy (like everybody else) and to research institutions.

    If we cut off the monetary support and subsidy of legacy power systems, people and businesses would realize energy is actually expensive and start looking for ways to reduce their power consumption, and people and businesses with the resources and expertise would be a lot more motivated to come up with alternative solutions.

    (One of my personal preferences for power generation would be distributed generation via solar power -- not the idiotic "let's just put a ton of solar panels out here where nobody can conveniently come take care of them" like we're seeing now, but rather a system where any place we have space that could use a roof and need power, we can drop a panel. Another of my preferences would be R&D into Thorium, which has been demonstrated effective but lost out to Uranium because you can get Plutonium out of Uranium and the government was interested in making bombs.)
    Jacob VanWagoner
  • The Key

    We in the USA need gas to be about $8/gal for the renewable energy to be cost competitive. At that point the market will take over and help it along. So vote for the politicians with the foresight and high IQ to raise the price of fossil fuels!
    HackerJ
  • Levelized Costs of Electricity Generation (LCOE)

    Levelized Costs of Electricity Generation (LCOE) - 2013 Update http://j.mp/LCOE_2013
    energystat
  • This is the "Catch 22" which AGAIN has been routed to the moderator

    Removing subsidies for, or taxing, non-renewable fossil fuels would produce the incentive to convert, but unfortunately many people who are just getting by now would suffer a great financial hardship for years. I wanted to submit my ideas for discussion, but the spam filter has prohibited me from doing so.
    jallan32
  • Fuel Cell Technology and Municipal Wastewater Treatment Plants in CA.

    Just wanted to share this...


    Nice article... searched and found some very interesting video and links in regards to what is happening here in California with respect to fuel cells being used at municipal wastewater treatment plants to create 3 value streams of electricity, hydrogen and heat. Impressive in my opinion. I am all for fuel cell technology.


    "New fuel cell sewage gas station in Orange County, CA may be world's first"
    http://abclocal.go.com/kabc/story?section=news/local/orange_county&id=8310315

    "It is here today and it is deployable today," said Tom Mutchler of Air Products and Chemicals Inc., a sponsor and developer of the project.



    2.8MW fuel cell using biogas now operating; Largest PPA of its kind in North America
    http://www.fuelcelltoday.com/news-events/news-archive/2012/october/28-mw-fuel-cell-using-biogas-now-operating-largest-ppa-of-its-kind-in-north-america


    Microsoft Backs Away From Grid
    http://blogs.wsj.com/cio/2012/11/20/microsoft-backs-away-slowly-from-the-grid/



    Construction of world's largest fuel cell power plant. (in South Korea? with USA developed fuel cell technology??)
    http://www.fuelcelltoday.com/news-events/news-archive/2012/october/construction-of-worlds-largest-fuel-cell-power-plant-expected-to-commence-in-2012


    DFC ERG Nat Gas / Fuel Cell Hybrid / Enbridge - Fuel Cell Energy
    http://enbridge.rawintegrated.com/hybrid/hybrid_complete.html
    Mickey Irish