KEY PRIORITIES Businesses and policy makers could focus on four key priorities to accelerate technological innovation from first demonstration to at-scale deployment by more than 50 percent, which could help make the energy transition more orderly. Lessons about accelerating technological innovation and rapid deployment can be learned from projects in other industries, such as pharmaceutical companies’ development of a COVID-19 vaccine, 45 and suggest that innovation could be unlocked even faster. 1. Collaborate across the value chain. Many of the new technologies needed for the energy transition would benefit from an “ecosystem,” meaning that upstream production, delivery infrastructure, and downstream consumers can all contribute to increasing the likelihood of successful deployment and spreading risk. While this would create uncertainty for any single player operating in only one part of an innovative technology’s value chain, the risk
would be mitigated through collaboration among stakeholders to jointly develop a full value chain. This kind of collaboration is key to the formation of hydrogen hubs like HyBuild Los Angeles and the Houston Hydrogen Hub, where alliances of private companies, industry coalitions, governments, and community groups are building out hydrogen production and transportation infrastructure to specific end users. Similar hubs are being explored to scale the development of carbon capture, utilization, and sequestration. 2. Lower the cost of capital for new technologies. Financial institutions and government entities could develop new measures such as public grants and low-cost loans to provide insurance for technical performance risks for early- stage technologies. These solutions could be designed to lower the cost of capital and stimulate more investment to accelerate “proof of failure” and commercialization. For
If carefully planned and executed—with attention to socioeconomic impacts and affordability concerns; supply chain, transmission and land constraints; technological innovation; and enabling market mechanisms—the United States can make marked progress toward a more orderly energy transition.
45 “Fast-forward: Will the speed of COVID-19 vaccine development reset industry norms?,” McKinsey, May 13, 2021.
Accelerating the journey to net zero
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