Download Low Carbon Fossil Fuel Technologies

Low Carbon Fossil Fuel Technologies:
Government Strategies and Corporate Capabilities
Current Research at the Sussex Energy Group
Fossil fuels are likely to remain part of the
energy supply mix for many years to come.
This is the case in industrialised countries
including the UK, and for rapidly developing
countries such as India and China.
In the medium term, it is therefore important
that low carbon fossil fuel technologies are
developed and deployed to reduce carbon
emissions. This project will examine the UK
government’s role in supporting this process. It
will analyse to what extent UK government
support can enhance domestic capabilities in a
set of technologies that are increasingly being
developed by international firms and
programmes.
Research Questions
The research will address the following
questions:
•
What contribution can government support
programmes make to the development of
UK capabilities in low-carbon fossil fuel
technologies? What is the UK’s role in
relation to other international technology
initiatives?
•
What activities are incumbent energy
companies engaged in to develop and
diffuse these technologies? How are they
managing the innovation process, and
what might be the role of new entrants?
•
What are the respective roles of
incremental improvements in fossil fuel
technologies and more radical approaches
such as carbon capture and storage?
Context
Modern energy systems still rely heavily on
fossil fuels. Whilst the Energy White Paper
implies a significant shift towards low-carbon
energy sources, most projections show that
fossil fuels will continue to play a key role in the
medium term. This is the case in the UK,
particularly with respect to natural gas. It is also
the case for many other countries, including
rapidly developing countries such as India and
China that are expanding their use of coal.
The DTI has recently developed a strategy for
Carbon Abatement Technologies that have the
potential to reduce the environmental impact of
fossil fuel use. This includes both radical
technologies to allow fossil fuels to be burned
with lower emissions (e.g. carbon capture and
storage) and incremental improvements to
existing technologies (e.g through improved
materials).
The DTI’s new strategy is explicitly international
in its focus. Many of the drivers for developing
cleaner coal technologies – particularly climate
change - are now global. Furthermore, many of
the technology developments are increasingly
being pursued through international
collaboration. This is particularly the case for
carbon capture and storage. Funding for new
technology continues to be dominated by
programmes in the USA. The EU, Japan,
Canada and Australia are also engaging in
significant development efforts.
A key issue for implementation of the DTI
strategy is what role the UK can play in relation
to these larger initiatives. This applies both to
support mechanisms implemented by
government (e.g. financial assistance for
demonstration projects) and the activities of
firms with a substantial base in the UK.
The research
The aim of this project is to analyse the UK’s
role in low-carbon fossil fuel technologies. It will
build on and integrate a number of previous
strands of research at SPRU including:
•
the assessment of the economic and
environmental performance of cleaner coal
•
•
technologies, and their suitability for
transfer to developing countries;
the rationale for UK government support
for carbon abatement technologies and the
effectiveness of previous support
programmes; and
the corporate strategies and technological
capabilities of incumbent power plant
equipment companies.
The new phase of work will take the
government’s new strategy for carbon
abatement technologies as its starting point.
Where possible, these will be carried out in
collaboration with other academic research
groups (particularly the TSEC carbon capture
and storage consortium) and firms. The project
will analyse the development and
implementation of the strategy as a case study
of government technology support. It will
consider this in the light of research that
emphasise the increasingly complex nature of
innovation processes. The understanding of
these processes has moved on from models
that consider innovation as a set of essentially
linear steps from R&D to commercialisation.
Newer models emphasise the networked
character of innovation which includes multiple
alliances between firms, and requires the
development of competencies in system
integration.
The project will focus on the extent to which UK
government support for carbon abatement
technologies could enhance relevant
competencies within UK-based firms. It will also
consider how international collaborative
initiatives (such as the recent one concluded
with China) might provide benefits for the UK. A
key issue for the research will be the
‘absorptive capacity’ of incumbent firms to take
on and develop new technologies. These
changes are competence enhancing or
competence destroying. Behind this is the
observation (most famously by Christiansen in
The Innovators Dilemma) that few large
corporations maintain their leading position
through major technological discontinuities.
This is because they rarely have the capacity to
compete with new entrants through adapting to
new technologies, markets and institutions.
The will use interviews with relevant actors,
published material and market data to map out
the activities of incumbents and new entrants in
a number of low carbon fossil fuel technologies.
The suitability of different theoretical models
(e.g. absorptive capacity) will be tested in order
to explain the strategy of incumbent companies
and to identify the factors influencing their
ability to develop and adopt the case study
technologies. Case studies will include radical
technologies (e.g. some variants of carbon
capture and storage) and incremental
technologies (e.g. improvements in the
efficiency of coal-fired power plants).
Policy-related outputs and implications
This project will help to inform future
government policy for low-carbon fossil fuel
technologies in a number of ways. First, it will
examine the extent to which the products of
government-sponsored R&D are likely to help
industry in the UK or contribute to broader
international developments. Second, the project
will help those involved in policy development
to understand the advantages and limits of
international collaborative programmes of R&D.
Third, it will aid an understanding of how
incumbent firms can develop new capabilities in
more advanced and complex fossil fuel
technologies. Within this, a key issue will be the
impact of government support on these
capabilities. Finally, the project will contribute to
the Sussex Energy Group’s ongoing work on
international technology transfer. Its will assess
the suitability of the technologies that fall within
the scope of the Carbon Abatement
Technology strategy for international transfer,
particularly to China and India.
Contact
Dr Jim Watson
Senior Fellow, Sussex Energy Group, SPRU,
Freeman Centre, University of Sussex,
Brighton, BN1 9QE
[email protected], 01273 873539