If policymakers decide that funding commercialization is a priority, Yanosek's article provides a roadmap for government support. First, limited public dollars would be best spent moving a bunch of promising new technologies to the next stage.
That leads to Yanosek's next rule of the road: Government clean energy technologies must not become hostage to stimulus spending and job creation objectives. The legitimate beneficiaries of commercialization-gap support are promising but unproven technologies with no steady revenue stream. They have the potential for cutting prices, but by nature are not likely to ramp up employment significantly until after they have successfully crossed the commercialization gap.
Loan guarantees in many cases are not the best structure for funding companies that push the boundaries of cost and efficiency, Yanosek argues. Instead, the government should invest equity and thus profit proportionately when a beneficiary succeeds, setting up a revenue stream for continued funding. The funding body, furthermore, should take advantage of private-sector expertise and maintain independence from the Department of Energy, where awards can be slow in coming and may be politicized.
Ultimately, Yanosek says, policymakers and taxpayers must embrace the incremental advances and understand that there will be failures along the way. For government to push an energy transition faster than the historical pace, it cannot remove the steps, but only hope to take them more quickly.
|Contact: Mark Golden|