Too many energy startups meet their demise in the Valley of Death - if they even make it that far - and that isn't good for innovation in this country, according to the Breakthrough Institute, which has some recommendations on how to change that.
The Oakland-based think tank identifies, in a new study entitled, "Bridging The Clean Energy Valleys of Death," two economic dry spots that hinder the ability to bring energy research out of the lab and into commercial operation. The financing gaps are commonly referred to as the early-stage “Technological Valley of Death” and the later-stage “Commercialization Valley of Death.”
From the report is this: "These valleys of death particularly plague capital-starved start-ups and entrepreneurial small and medium-sized firms, the very same innovators that are so often at the heart of American economic vitality. "
To fill the early-stage gap, the Institute recommends greater use of two policies: The federal Department of Energy Advanced Research Projects Agency and a Regional Clean Energy Innovation Consortia.
The first program, funded by stimulus money and signed into law in 2009 by President George W. Bush, allocates relatively modest sums - generally $2 million to $10 million - to help entrepreneurs through that early-stage crisis point.
The latter policy would create public-private partnerships of universities, venture capitalists, manufacturers and others to hurdle the second part of the Technological Valley of Death.
Then comes the Commercialization Valley of Death - and the Institute has suggestions on how to fill that gap too: A Clean Energy Deployment Administration (CEDA) and national clean-energy testbeds.
A CEDA is a bank seeded with government funds but operated as an independent organization that offers a variety of financing mechanisms. Those include investment funds, guarantee programs, insurance plans, bonds and debt financing. It would replace the Department of Energy's Loan Programs Office.
Meanwhile, the national clean-energy testbeds program would provide "pre-approved, monitored and grid-connected" public land as demonstration sites for new energy technology, according to the Institute's study.
The study acknowledges risks in all early technology projects, but suggests too many promising prospects fail to reach the launching pad: "To meet this challenge, the country must build an institutional system that fosters innovation, entrepreneurship, and competition, and avoids picking incumbent technologies over innovative, yet risky, technologies."
Innovation - or lack of it - is in the news a lot these days, and is the subject of a new book co-authored by New York Times columnist Thomas Friedman. In this review, Fast Company quotes Friedman as saying that innovation, when it becomes a priority, can lift the nation.
The Oakland-based think tank identifies, in a new study entitled, "Bridging The Clean Energy Valleys of Death," two economic dry spots that hinder the ability to bring energy research out of the lab and into commercial operation. The financing gaps are commonly referred to as the early-stage “Technological Valley of Death” and the later-stage “Commercialization Valley of Death.”
From the report is this: "These valleys of death particularly plague capital-starved start-ups and entrepreneurial small and medium-sized firms, the very same innovators that are so often at the heart of American economic vitality. "
To fill the early-stage gap, the Institute recommends greater use of two policies: The federal Department of Energy Advanced Research Projects Agency and a Regional Clean Energy Innovation Consortia.
The first program, funded by stimulus money and signed into law in 2009 by President George W. Bush, allocates relatively modest sums - generally $2 million to $10 million - to help entrepreneurs through that early-stage crisis point.
The latter policy would create public-private partnerships of universities, venture capitalists, manufacturers and others to hurdle the second part of the Technological Valley of Death.
Then comes the Commercialization Valley of Death - and the Institute has suggestions on how to fill that gap too: A Clean Energy Deployment Administration (CEDA) and national clean-energy testbeds.
A CEDA is a bank seeded with government funds but operated as an independent organization that offers a variety of financing mechanisms. Those include investment funds, guarantee programs, insurance plans, bonds and debt financing. It would replace the Department of Energy's Loan Programs Office.
Meanwhile, the national clean-energy testbeds program would provide "pre-approved, monitored and grid-connected" public land as demonstration sites for new energy technology, according to the Institute's study.
The study acknowledges risks in all early technology projects, but suggests too many promising prospects fail to reach the launching pad: "To meet this challenge, the country must build an institutional system that fosters innovation, entrepreneurship, and competition, and avoids picking incumbent technologies over innovative, yet risky, technologies."
Innovation - or lack of it - is in the news a lot these days, and is the subject of a new book co-authored by New York Times columnist Thomas Friedman. In this review, Fast Company quotes Friedman as saying that innovation, when it becomes a priority, can lift the nation.
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