Has there ever been a time when more energy technologies were directly competing for research and development funding? Coal power has been the recipient of money to develop carbon capture and sequestration methods as well as other so-called clean coal technologies. The Department of Energy has allocated as much as $100 million dollars a year supporting the Generation IV nuclear reactor program, which promises new reactor technologies which may be available in coming decades. Biofuels startups are tapping millions in venture capital funds. And techniques for drawing power from wind, ocean, and solar energy have also seen an influx of R&D dollars.
It goes without saying that advocates feel that their own energy technology is the most worthy of additional funding. Statements to that effect wind up in business plans and PowerPoint presentations. But sales pitches aside, is there way to assess the relative merit of additional investment in, say, fossil fuels versus that in solar thermal power? One that can suggest which technology may be poised to make a big leap in cost-effectiveness?
Melissa Schilling believes there is. Schilling, a professor at the Stern School of Business at New York University, recently analyzed electricity-production technologies using a method that’s been applied to various high-tech industries. The results may be startling to some: According to Schilling, both wind and geothermal power are poised to become more economical than fossil fuel, needing just a relatively small infusion of additional capital.
Perhaps more controversially, Schilling says her analysis also indicates that further investment in fossil fuel technologies looks to be money wasted.
Schilling’s work is based on the widely held observation that the performance of a technology, when plotted against the cumulative research and development money directed toward it, follows a fairly predictable path. At first, the performance gain in the technology i |
