Federal Funding for Renewable Energy Commercialization
Editor’s Note: The is a guest contribution by Ian Rogoff, Chairman of the Nevada Institute for Renewable Energy Commercialization, and Chairman and CEO of The Helio Group (parent company to HelioPower). This is the sixth post in a series from the CEO’s of major solar companies. You can follow the complete series here.
There is a long overdue debate underway in industry and political circles regarding the merits of federal funding for renewable energy (RE) commercialization.
Distinct from RE projects and RE deployments, commercialization involves identifying specific technologies and entrepreneurs based on their perceived commercial potential and financing the respective project teams along a vector towards commercial success.
The types of commercialization activities typically funded include scaling benchtop prototypes to meet market requirements, characterizing technologies to understand performance and limits, testing boundary conditions, designing for manufacturability, testing for real world conditions, scaling refinery processes, among others.
Commercialization is quite distinct from basic research, and expressly does not seek to fund pure science or unproven claims. Typically, commercialization funding stops at a point where the private sector steps in and either assumes the next funding milestone or market acceptance/rejection obviates the need for additional financing entirely.
Two types of barriers exist today in the commercialization of renewable energy technology: the “valley of death” and the “mountain of death.”
Renewable Energy’s Valley of Death
Basic RE research is being conducted at numerous institutions around the world and much of this technology remains trapped in labs for want of commercialization know-how and funding. Basic and applied research is likewise being conducted in commercial enterprises, but much of that research is often constrained through short-term return on investment requirements.
In addition, renewable energy technology often fails to garner the resources and funding needed in order to reach commercial viability as a result of existing regulatory and fiscal regimens that bias markets towards incumbent technologies. Absent investment and institutional know-how, the commercialization of renewable energy will continue to be hampered in its application and hindered in its ability to cross the so-called “valley of death.”