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A Framework for Fuel and Technology Transitions in Energy: Evaluating Policy Effectiveness

About the Workshop:

The objective of the workshop was to discuss a framework to add to current approaches for evaluating the effectiveness of policy instruments in delivering rapid transitions that meet their intended objectives.

Evaluating the effectiveness of transition policy and incentives requires an understanding of the key dynamics that determine the pace and path of transitions. This workshop, and subsequent sessions will seek to provide policymakers with a framework for assessing the implications of policy instruments on achieving the intended objectives of their energy transition plans.

Key Points:

  • Energy technology and fuel transitions are impacted by a large number of actors and forces. This results in resistance to policy intervention and other potential unintended consequences.
  • Existing literature on energy transitions includes several empirical analyses of historical transitions, theories of innovation and technological transition, and some recent modeling efforts.
  • The growing demand for the new technology tightens its supply/demand balance, thereby placing upward pressure on its LCOE.
  • Energy transitions can be conceptualized by representing the cost competitiveness between the incumbent and the new technologies. This conceptualization underscores the significance of technology supply chain evolution on the pace and path of transitions.
  • Prioritizing transition policy objectives to address tradeoffs
  • The perfect storm of enablers defines or redefines transitions

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