Policy needed to tap $1T advanced energy market

April 23, 2013 | By Barbara Vergetis Lundin

Advanced energy is a $1 trillion global market, growing revenue by 19 percent in 2012. But in order to take advantage of this economic opportunity, the U.S. will need to work to align federal policy, according to Advanced Energy Economy (AEE).

As part of its ongoing research, AEE's educational and charitable affiliate Advanced Energy Economy Institute commissioned PA Consulting Group to interview CEOs of advanced energy companies across a range of technologies and services, about how federal policies affect them and their businesses. The researchers interviewed companies big and small, established and start-up, technology-focused and service-oriented.

Respondents overwhelmingly agreed that the U.S. could spur faster industry growth if policy was designed to maintain market stability, create a level playing field, support a broad innovation portfolio, limit the duration of incentives, and solve broad problems rather than prescribe narrow solutions.

Nearly every executive interviewed supports the Federal Government's involvement in research and development in advanced energy, especially if done through independent agencies in support of a wide range of firms at varying scales. Advanced Research Projects Agency-Energy (ARPA-E) and Defense Advanced Research Projects Agency (DARPA) were cited as the best existing models, with DARPA exhibiting the added benefit of linking product development to an established defense procurement market.

Tax credits are seen as a powerful tool to incentivize, but should sunset in a well-structured and clearly defined manner. Tax incentives that currently create preferential treatment for conventional energy technologies should either sunset or be widely offered to advanced energy generation technologies. The Master Limited Partnership (MLP) ownership structure, now available only to certain conventional energy facilities, is one that many executives say should be available to advanced energy technologies as well.

For more:
- download the report

http://www.fierceenergy.com/story/policy-needed-tap-1t-advanced-energy-market/2013-04-23