Implementing Radical Innovation in Renewable Energy Experience Curves

Paul Kerr, Donald R. Noble, Jonathan Hodges and Henry Jeffrey
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Paul Kerr: Institute for Energy Systems, School of Engineering, University of Edinburgh, Edinburgh EH9 3DW, UK
Donald R. Noble: Institute for Energy Systems, School of Engineering, University of Edinburgh, Edinburgh EH9 3DW, UK
Jonathan Hodges: Wave Energy Scotland, An Lochran, 10 Inverness Campus, Inverness IV2 5NA, UK
Henry Jeffrey: Institute for Energy Systems, School of Engineering, University of Edinburgh, Edinburgh EH9 3DW, UK

Energies, 2021, vol. 14, issue 9, 1-28

Abstract: Cost reductions in nascent forms of Renewable Energy Technology (RET) are essential for them to contribute to the energy mix. Policy intervention can facilitate this cost reduction; however, this may require a significant investment from the public sector. These cost reductions fall into two broad categories: (1) incremental cost reductions through continual improvements to existing technologies, and (2) radical innovation where technologies that significantly differ from the incumbents are developed. This study presents a modelling methodology to integrate radical innovation in RET experience curve and learning investment analysis, using wave energy as an example nascent RET. This aims to quantify the potential effects of radical innovation on the learning investment, allowing the value of successful innovation to be better analysed. The study highlights the value offered by radical innovations in long-term deployment scenarios for wave energy. This suggests that high-risk R&D efforts in nascent RET sectors, even with low success rates, could still present significant expected value in offsetting future revenue support.

Keywords: innovation; experience curve; learning investment; renewable energy; wave energy; forecasting (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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