Energy Network Innovation for Green Transition: Economic Issues and Regulatory Options

17-03-2021

In this age of low-cost capital and stimulus packages, is it the best time to heavily invest in tomorrow’s energy networks and research infrastructure?

In the academic literature it is widely acknowledged that innovation is key to decarbonising the energy sector and fostering sustainable development. However, post liberalisation has been struggling to promote R&D and innovation. Is this a case of business, regulatory, or policy failure, or are there other factors involved? In this paper, we discuss the reasons for slow uptake of new technologies in energy networks and propose some remedies for the European context, where innovation in the area of energy networks is crucial for the implementation of the Green Transition. The solutions to address this shortfall need to be considered in an overarching manner. The specific points raised here are based on incentive regulation, the establishment of competitive funding models like Ofgem’s Low Carbon Network Fund, and a large European collaborative research hub.

Authors:
Tooraj Jamasb, Manuel Llorca, Leonardo Meeus and Tim Schittekatte