Industry projects to grab EU energy research funds

To make sure that happens, Brussels is shifting the bulk of future energy research funds towards industry-driven projects, according to European Commission officials. The change is a key tenet of the EU’s €50 billion roadmap for research in everything from solar to smart grids – called the Strategic Energy Technology (SET) Plan.

The SET Plan is an ambitious blueprint for Europe to grab global leadership in the six clean technologies of solar, wind, bio-energy, smart grids, carbon capture and storage, and sustainable nuclear fission. Its aim is to better orchestrate energy research and overcome the fragmented efforts that so often leave Europe punching under its weight.

In a dramatic break with EU energy research practices, the first round of SET calls in 2009, funded by the Economic Recovery Programme, awarded as much as $180 million to each of six consortia, to start building demonstration plants for carbon capture and storage. The EU has pledged to fund 50 per cent of the total $1 billion tab for each demonstrator, shouldering part of the huge risk of scaling-up and validating the technology for commercial use.   

Upcoming 2010 energy research calls will channel the bulk of funds to similar demonstration projects in other clean technologies such as photovoltaic solar research and wind energy. Under the SET plan, Brussels aims to offer industry larger sums of money, and eliminate the need for huge, unwieldy consortia – often dubbed “European window-dressing” – designed to please a vast array of national political constituencies.  

Many companies are fed up with the existing Brussels game rules, saying the costs outweigh the benefits, and that consortia are too large and difficult to manage effectively.  As a result, the rate of industry participation in EU collaborative research has been declining steadily for years.  In 2009, only 24 per cent of Framework programme funds went to industry, down from 39 per cent in 1998.   

SET, with its plan for six new European Industrial Initiatives in solar, wind, bio-energy, smart grids, carbon capture and storage and nuclear fission technologies, is designed to reverse that trend.   

The initiatives will help pioneer a new approach to public-private partnerships at the EU level. The first four are scheduled to be launched at an EU-sponsored conference in Madrid on June 3-4.

Europe’s first attempt at designing large-scale public-private partnerships began in 2004 with the so-called Joint Technology Initiatives (JTIs). Five JTI’s were conceived to implement Europe’s research agendas in aeronautics, embedded computer systems, innovative medicines, nanoelectronics, and fuel cells and hydrogen. But their legal structure as European bodies was flawed from the start, resulting in agonising delays, endless tedious audits and bureaucracy. It took 3 to 5 years to set up each initiative before any research could begin.  

When it comes to designing a structure for public-private partnerships, the EU seems “paralysed by the political necessity of avoiding rather than managing risks,” said Jan van den Biesen, Vice President of Research at Philips in a speech last November to the European Parliament’s committee on Research, Industry and Energy (ITRE) on behalf of BusinessEurope.

The stakes are too high for the Commission to ignore that outcry. The JTIs run for 7-10 years and have budgets of as much as €1 billion, half of which is funded by the EU. If they fail, so goes the EU’s effort to develop world-beating technologies and jobs in vital future industries.

Pressing for change, senior executives from each of the five JTIs submitted a report in January to the Commission. “Designing the ‘ideal house’ for public-private partnerships in European Research,” contained detailed criticisms of the existing structure and recommendations for a more streamlined, flexible legal structure for public provate research initiatives.   

Once established, this new framework could be used across the entire EU research landscape, including the industrial partnerships needed under SET to drive breakthroughs in renewable energies and bring them to market.