Narayanamurti, Venkatesh, Laura D. Anadon, and Ambuj D. Sagar, “Institutions for Energy Innovation: A Transformational Challenge”

The authors of this paper focus on key concepts that they believe must be appreciated in order for government-funded research to effectively spur technological innovation in the energy sector. They note that energy technology innovation is particularly complex and nonlinear. Energy technologies are often large-scale, must compete with incumbent technological systems (and thus must fight “lock-in”), and incommensurability in the scope and nature of goals between public and private sector. They recommend a model of “open innovation,” which encourages research organizations to share and look for knowledge with external institutions: individual inventors, start-ups, established labs, and various spin-offs. They identify five elements that are necessary for a technology innovation institution to be successful:

1. A clearly-defined mission that is informed by, and linked to, a larger systems perspective. Public entities should focus on a public good or a market failure, and on creating an industry, not a product.
2. Leadership that has proven scientific and managerial Excellence, has a vision of the role of the institution or enterprise in the overall energy system, and is capable of acting as an integrator of processes. An environment must be created that allows for freedom without loosing focus.
3. Entrepreneurial culture that promotes competition but also collaboration and interaction among researchers.
4. Management procedures and organizational structures that promote independence, and yet give primacy to performance and accountability. The divide between basic and applied research must be eliminated (IBM’s T.J. Watson Research Laboratories are the exemplars of this approach; they don’t even distinguish between the two).
5. Stable and predictable funding that allows a thorough and sustained exploration of technical opportunities and system-integration questions. (Past Department of Energy funding has been extremely volatile.)

The authors’ prescriptions for more effective energy innovation thus focuses primarily on the structure and management of the institutions themselves, arguing for recognition that they are “delicate ecosystems” that require careful and skilled management, insulation from bureaucracy, a strong central goal, and block funding.


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