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In order to sharply reduce carbon emissions, we need more than scientific and technological breakthroughs. We need to completely restructure our energy innovation system.
MIT Professor Richard Lester offers one way to make that happen — and explains why nuclear power remains a critical piece of the 21st century energy mix.
Richard Lester founded the Industrial Performance Center at the Massachusetts Institute of Technology, and is Japan Steel Industry professor and head of MIT's Department of Nuclear Science and Engineering.
Innovation offers us our best chance to solve the urgent and interrelated problems of climate change, worldwide insecurity over energy supplies, and rapidly growing energy demand. But achieving a timely transition to efficient, reliable, low-cost, low-carbon energy will require a radical overhaul of the energy innovation system.
Accelerating innovation means accelerating every stage of the innovation process. It isn’t enough just to focus on the early stages. There we rely on a combination of federal funding of fundamental research and private seed funding of new energy concepts and start-up companies. We need more of all of this. But much of the force that additional investment might exert at the front end of the process will be dissipated unless effective strategies are also in place to address the intermediate and downstream stages, including the continued refinement of the innovation after it is already in large-scale commercial use.
It’s at the middle stages of 1) demonstrating the commercial viability of new technologies, and 2) reducing costs and risks, making other improvements, and building out complementary manufacturing and regulatory structures during initial take-up of the innovation in the marketplace that the U.S. falls short.
Private capital markets focus on short-term returns and won't make the large-scale, long-term and often risky investments required to develop the low-cost, low-carbon energy sources of the future. So public action is needed, but this doesn’t mean putting Federal agencies in the driving seat.
What's needed is a sizable source of steady, reliable, patient capital to make investments in the range of tens of millions to billions of dollars to spur waves of innovation that will reduce the costs and risks of low-carbon technologies (energy efficiency, nuclear, wind, solar, geothermal, carbon capture and storage) so that by 2050 they will have largely replaced fossil fuels, especially in the power sector.
Congress or, more likely, consortia of states should establish a network of Regional Innovation Investment Banks (RIIBs) whose purpose would be to co-finance, along with private capital, demonstration and early deployment projects for the new low-carbon energy infrastructure.
Funds would come from an innovation investment surcharge paid by electricity users. A surcharge of two-tenths of a cent per kilowatt-hour — similar to the energy conservation charge already in place in many states — would raise about $8 billion annually. State trustee organizations, functioning somewhat like state pension fund trustees, would allocate these funds to the RIIBs on a competitive basis. The federal government's only role would be to serve as a "gatekeeper," certifying that proposed demonstration and early deployment projects meet the criterion of reducing our collective carbon footprint.
An important question concerns the role of nuclear power in our energy future. I believe that a major worldwide expansion of nuclear power is an essential component of a low-carbon energy future. Projections made by the International Energy Agency indicate that nuclear power may need to meet about 25 percent of global electricity demand by 2050 if we are to avoid the worst risks of climate change. To reach that goal, we would need to build more than twice as many nuclear plants worldwide in the next 40 years as we did in the last 40 years.
The global nuclear industry faces major challenges in the wake of the Fukushima disaster two years ago. However, I believe we're likely still at the early stages of development of nuclear science and technology, roughly analogous to where the field of electrical engineering stood in 1900 — before the development of the power grid, radio, television, telecommunications, and the Internet. No one today can foresee the range of safe, practical applications of nuclear technology that may be commonplace at the dawn of the 22nd century, except to say that the nuclear power plants of the year 2100 will have about as much resemblance to today’s reactors as a modern automobile has to a 1913 Model T Ford.
This program aired on March 6, 2013. The audio for this program is not available.
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