Renewable Energy Technologies to Play an Important Role in a Clean, Clever, and Competitive Energy Future

(Paris) — 14 February 2006

“Renewable energy technologies are a crucial element in achieving a balanced global energy future; renewables can make major contributions to the diversity and security of energy supply and to economic development”, said Claude Mandil, Executive Director of the International Energy Agency (IEA) today in Paris, at the launch of a new publication: Renewable Energy: RD&D Priorities, Insights from IEA Technology Programmes. “Furthermore, considerable attention has been drawn to their potential for mitigating climate change”, Mr. Mandil added. He pointed out that in 2005, IEA Ministers had called for a clean, clever, and competitive energy future, and stated that renewable energy technologies as part of a balanced energy mix will need to play a significant role in this future.

“We need to use public funds as effectively as possible in achieving this”, Mr. Mandil said. “Countries must improve their market deployment strategies for renewable energy technologies and above all, increase targeted renewables RD&D - simultaneously ensuring continued cost-competitiveness. There is much at stake.”

The publication recommends priorities for this important effort, drawing on studies, analyses and technology programmes carried out by the IEA technology network. It also reviews the trends in government RD&D spending and lists RD&D policies in IEA member countries.

Government energy RD&D budgets in IEA member countries increased sharply after the oil price shocks of the 1970s. By 1987 however, they had declined to about two-thirds of their peak level and thereafter stagnated until 2003. The share of renewable energy technologies in total energy RD&D spending remained relatively stable, averaging 7.6% for the whole period.

Among renewable energy technologies, the shares in global funding of biomass, solar photovoltaic and wind have increased, while those of ocean, geothermal and concentrating solar power have declined – broadly reflecting the evolving consensus as to where the greatest potential lies. Of course, there are great variations in the balance of spending of individual countries, reflecting resource potential and national energy policies. The United States, Japan and Germany are the biggest total spenders on energy technology RD&D, although Switzerland, Denmark and the Netherlands are the leaders on a spending per capita basis.

The purpose of the IEA publication is to assist governments in prioritising their RD&D efforts for renewable energy. RD&D activities have played a major role in the successful development and commercialisation of a range of new renewable energy technologies in recent years.
Successful RD&D programmes need to be well focused and should be co-ordinated with both industry efforts to promote commercialisation and competitiveness in the market, and with international programmes. In addition, they must reflect national energy resources, needs and policies. They also need to have roots in basic science research. Issues of public acceptability, grid connection and adaptation, and managing intermittency are common to a range of renewable energy technologies and need to be addressed in government RD&D programmes.

But renewables RD&D should not be left solely to government. Industry can be expected and should be encouraged to play a major role in the development of all technologies, whether or not yet commercially available.

Energy security, climate and environmental concerns are strong drivers of national energy policies. This was underlined by the May 2005 IEA Ministerial meeting and the G8 Summit in Gleneagles in July 2005. Renewables must take on these challenges.

Each country has its own RD&D priorities based on their particular resource endowment, technology expertise, industrial strengths and energy markets. Recent IEA analysis demonstrates consensus that RD&D in renewable energy must be strengthened, but with a caveat that priorities must be well selected, in order to address priority policy objectives, especially as they relate to prospective cost-effectiveness. Intelligent choice of such priorities will invariably facilitate market deployment of new and improved technologies, including renewables.

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