How will businesses finance the future of energy?
A new report outlines business challenges and policy challenges thwarting the growth of the advanced energy sector, in order to identify policy improvements that could overcome these challenges.
Indian workers walk past solar panels at the Gujarat Solar Park about 155 miles from Ahmadabad, India. Financing of emerging technologies is one of the most significant business challenges the energy sector faces.
Ajit Solanki/AP/File
In April, the Advanced Energy Economy Institute (AEEI) released the synthesis of a survey of executives in the advanced energy sector conducted by PA Consulting to suggest priorities for U.S. energy policy.
The report, Accelerating Advanced Energy in America, outlined business challenges and policy challenges thwarting the growth of the advanced energy sector, in order to identify policy improvements that could overcome these challenges.
The most significant business challenges identified were: financing of emerging technologies, scaling technologies from development to commercialization, declining electricity prices (primarily owing to the natural gas boom), and recruiting a qualified and skilled workforce.
The most significant policy challenges identified were: regulatory/policy uncertainty, “static definitions” of technologies qualifying for support, inadequate R&D support, and politicization of advanced energy.
From these challenges, AEEI summarized the respondents’ observations to make the following suggestions on sound energy policy:
- Business leaders want stability and predictability in market structures.
- They want a level playing field with their competitors – with traditional energy, and with each other.
- They want government to support research across a wide range of technologies.
- They want subsidies that make new technologies more competitive to be limited in duration, and phased out in a gradual, predictable manner, not maintained forever or cut off after arbitrary deadlines.
- They want government policies crafted around broad problems, rather than pre-ordained solutions so that the market can identify the best ways forward.
It’s a reasonable wish list to ask of policymakers. But, then again, when did “reasonable” last prevail in Washington DC?