Select Committee on Innovation, Universities, Science and Skills Written Evidence

Annex B

Memorandum from the Economic and Social Research Council (ESRC) to the House of Commons Science and Technology Committee Inquiry


  1.  The ESRC supports high quality social science research across a broad range of energy issues, including the economic, regulatory, business, social and public acceptability aspects of renewable energy. Energy, Environment and Climate Change is identified as one of seven key research challenges within ESRC's 2005-2010 Strategic Plan; energy is therefore a priority area for creating new research opportunities. Much of the Council's current research is funded in collaboration with RCUK partners, for example through the Research Councils Energy Programme, including the UK Energy Research Centre, and the Tyndall Centre for Climate Change Research, as is detailed elsewhere in this submission, and is undertaken in collaboration with a range of policy, business and other stakeholders. Further details of ESRC research can be obtained from ESRC society Today at

  2.  Research of particular relevance, includes that being undertaken by the ESRC Sussex Energy Group (, as a part of the Research Councils Energy Programme. The group is, for example, undertaking research on: the extent to which control technologies can aid the transition to more active electricity networks and aid the development of distributed generation from renewables; the value of renewables in contributing to diversity of UK electricity supply portfolios; and methods for evaluating energy policy.

  3.  The Cambridge Electricity Policy Research Group (, also funded under the Research Councils Energy Programme, is undertaking research on better market design for delivering efficient, secure and diverse energy supply and on appropriate mechanisms for supporting RD&D in energy. For example a recent paper has discussed the potential role of international collaboration, markets and competition in mainstreaming new energy technologies (Mainstreaming New Energy Technologies, K Neuhoff and R Sellers (2006)

  4.  A research report on "Large scale Deployment of Renewables for Electricity Generation" Karsten Neuhoff (2004) (Cambridge Working Papers in Economics CWPE 0460) (http://www.electricity is also relevant and concludes:

    "Resource assessments suggest that renewables could satisfy a much larger share of global energy demand. This would enhance our security and environment. However, the market share of renewables will not increase unless new energy and technology policies address the following barriers:

—  Traditional energy technologies are not exposed to full security and environmental costs and offer energy below the level of total social costs. Levelling the playing field implies re-allocation of rent between stakeholders and is therefore a slow process. In the meantime, subsidies for renewable technologies might be required to ensure efficient investment decisions, and subsidies for conventional technologies should be reduced.

—  Markets and tariff structures are designed and optimised for fossil generation technologies. They do not address the specific requirements of renewables: flexible operation, long-term contractual arrangements to reduce financing costs particularly in an environment with high regulatory risk, and simple procedures with low-transaction costs for their small-scale nature.

—  Renewables are at different stages of development, and fit into different markets. Therefore, policy support needs to address the specific stage and market of each renewable. For emerging and innovative technologies, this means increasing substantially the collective investment in RD&D, and for those entering the market, increasing the level of deployment incentives. Several countries applying strategic deployment in parallel will create industry confidence in continuous market growth.

—  The discovery of a new energy technology that suddenly resolves all energy challenges would be great, but has not happened in the past and is unlikely to occur in the future. In contrast, we have consistently observed that technologies become more cost effective with improvements through market experience. However, this does not happen autonomously—most renewable energy technologies are locked-out from large-scale market experience because the playing field is uneven and various barriers and technology spill-over prevent industry from financing the learning investment. It is in the power of governments to unlock these Technologies".

  5.  Research under the Research Councils Energy Programme, co-ordinated by the University of Manchester (Dr P Devine-Wright—Beyond Nimbyism: a multidisciplinary investigation of public engagement with renewable energy technologies) is extending research on public acceptability to renewable energy technologies (mostly related to onshore wind) by examining a range of forms of technology which are expected to figure, to varying degrees, in the UK renewable energy profile—offshore wind, biomass of various forms, small scale HEP, large scale photovoltaics and more speculatively the various ocean technologies currently under development and by deepening understanding of the dynamics of public engagement in renewable energy technological development:—nimbyism/

  6.  New research recently commissioned by the ESRC under its Targeted Initiative on Innovation is comparing approaches in the use of demonstrations and trials in North America, Europe and Japan in respect to fuel cells, wind and photo-voltaic and evaluating their impacts on accelerating innovation and the impact of external policy factors on success (City University). Another project is comparing experience in Brazil, USA and Europe in supporting innovation in the transition from a petrochemicals based to a bio-economy-based technology platform, with a particular focus on bioethanol.

  7.  Research under ESRC's recently completed Sustainable Technologies Programme, has tracked the progress of a range of renewable technologies, including microgeneration, community energy initiatives, marine and wind energy, and the impact of, and interaction between, innovation systems, markets, regulation and incentives, and business and societal responses. A summary report of findings can be found at: For example, "Unlocking the Power House: policy and system change for domestic micro-generation in the UK" (Watson, J, Sauter, R, Bahaj, B, James, P, Myers, L, Wing, R, October 2006) suggests that successful deployment of microgeneration on a large scale will require policy makers to support a diversity of routes deployment, with incentives for both householders and energy companies. The report also focuses on two areas in which micro-generation and household energy saving investments suffer from an `uneven playing field'—the fiscal system and the market settlement system for electricity and highlights a range of areas requiring further attention such as development of a household energy service market, design of buildings and infrastructure and smarter metering. Further details can be found at:

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2008
Prepared 19 June 2008