Big Question on Climate Crisis: How to Inspire Innovation - Justin Gillis, The New York Times

On the edge of Hamburg, the northern German port city, the industrial giant Siemens is testing a way to offset the erratic nature of renewable power by storing energy in hot rocks.

Off the coast of Scotland, an oil company will soon install the first commercial wind turbines that float in deep water, a potential clean-energy breakthrough that could be adopted around the globe.

And in Texas, an American company is about to test a new type of power plant that may generate electricity while cheaply capturing the emissions, allowing the climate-altering pollution to be pumped safely underground.

Around the world, energy innovation seems to be speeding up.  Large historical forces are converging to create unprecedented turmoil and opportunity in what had long been one of the most hidebound industries.

Experts say that to forestall the worst effects of global warming, emissions need to drop by 80 percent or more globally by 2050, a mere 34 years from now.  But at a global scale they are not falling at all, and the promises countries have made about the energy transition, even if kept, would get the world nowhere close to where it needs to be.

That means, experts say, that innovation in the field of energy will have to accelerate if governments hope to stave off catastrophe.

While the cost of renewable energy sources has plunged, it is still not low enough in most places to drive dirty energy out of the market.  And while renewables have shown that they can replace large amounts of fossil fuels, many experts say they believe they cannot do the whole job and new technologies will be needed in coming decades to get greenhouse emissions to zero.

Progress on those new approaches has been halting, at best.  So the future habitability of the Earth might depend on the answer to this question:  How can innovation in the energy business be pushed into overdrive?
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“Some of these venture capitalists had the mind-set that we’ll get this stuff invented in the garage, and then we’re just going to disrupt the whole sector,” saidTeryn Norris, a director at the PIRA Energy Group, a consultancy in New York.

Billions of dollars poured into “clean-tech” investments.  Most of them failed, and within a few years, investors were acknowledging they had misjudged the difficulty of the problem.

“They ran up against the hard realities of the energy sector,” which does not remotely work the same way as most of the technologies emerging from Silicon Valley, Mr. Norris said.
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Because the delivery of electricity is a natural monopoly — multiple sets of wires would be a chaotic mess — state governments essentially took control of the electricity business a century ago.

They dictated what companies were allowed to build and set the prices they were allowed to charge, usually by lumbering, bureaucratic procedures that took years.  The focus was on forcing the utilities to keep prices low while eking out modest returns on their investments.

Not surprisingly, electric utilities were among the least innovative businesses in the entire economy, spending next to nothing on research and development.  Some aspects of the business have been reformed in recent years, but progress has been halting.
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As it became clear late in the 20th century that the emissions from coal, oil and natural gas threatened the world’s climate, a cry for change arose.

But the tight linkages between energy companies and governments meant that if change was to come, it would only come as a result of strong public policies.

That, in turn, set off a debate that is still underway:  What, exactly, should those policies be?
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But many energy experts ... see an urgent need to speed the pace of research and development.  Their concerns center on the limitations of renewable power.  Because the sun does not always shine and the wind does not always blow, solar panels and wind turbines are not entirely reliable sources of electricity.
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Wind turbines in the sea are one answer.  The strong, steady ocean breezes mean that far more power can be produced than from turbines on land.  But putting huge machinery into the ocean is expensive, and for years European governments have had to offer high subsidies to get that industry off the ground.
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Recently, instead of handing out fixed subsidies, they have been running “reverse auctions” for new wind projects.  The company that asks for the lowest subsidy on a particular project gets the deal, and the subsidy.

The results have been startling, awakening fierce price competition among the developers of wind projects.
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Offshore wind farms have been installed only in shallow water, but Statoil, the Norwegian oil company, and other companies are pursuing floating turbines that could work in many parts of the world where the sea floor drops off steeply.  Statoil will soon start building the first commercial project of this type, a pilot off the coast of Scotland.

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