The UK Accelerated Innovation System for Energy: A critical review and a commentary

Dr Mark Winskel, Edinburgh University and UK Energy Research Centre

Technological innovation offers a compelling promise as an enabler of energy system change. Over time, innovation promises to unlock more affordable and more diverse change pathways: in some scenarios, the cumulative cost of climate change mitigation is halved under advanced technology scenarios compared to less advanced counterparts. In practice, this is a beguiling promise, infused with risks and pitfalls, and the centrality of innovation in energy system change cannot be taken for granted. For private investors, innovation brings added risks (technical, construction, regulatory) which translate as higher costs. Other things being equal, energy system transformation is likely to be most affordably realised through proven technologies alongside behavioural and institutional changes. In practice, there is no ‘innovation-free’ pathway for UK energy system change – accelerated innovation, despite its costs and risks, is a corollary of accelerated system change.

Reflecting this, the UK’s energy innovation system is being substantially remade. Recent developments have included the publication of authoritative roadmaps for renewable energy and nuclear fission (with a roadmap for carbon capture and storage to follow), the carrying-out of Technology Innovation Needs Assessments for key technologies such as offshore wind, and a system-wide Low Carbon Innovation Delivery Review. The overall trend here is toward a more co-ordinated and directed ‘accelerated innovation system’, aimed at driving down the costs of the large-scale supply technologies seen as capable of offering major contributors to system change. The UK Government’s Carbon Plan describes this as a focus on cost reduction for key technologies over the next decade, allowing them to compete in a low carbon ‘technology race’ in the 2020s. Even so, recent international reviews of energy innovation policies have criticised the UK for its organisational fragmentation, and mismatch between spending patterns and strategic priorities.

This paper presents a critical review of the recent remaking of the UK energy innovation system, drawing on domestic policy developments, international reviews and research evidence on technology learning in the energy sector. The paper firstly reviews recent public policy developments in the UK energy ‘accelerated innovation’ system, highlighting mechanisms for technology learning encoded in recent initiatives and plans. It then positions UK responses in wider context by considering some international responses to the accelerated energy innovation challenge, international debates on accelerated energy innovation policymaking, and also, evidence from the research literature on energy technology learning. While the development of more co-ordinated and directed innovation systems is an appropriate response to pressures for accelerated change, it brings with it new risks and pitfalls that need to be recognised and where possible responded to, in any effective policy response.