EE #1 - Back On Arran. CleanTech R&D Spend. Current Reading List
When it comes to CleanTech R&D funding, are we spreading it too thinly?
Pic: Lamlash Bay, Isle of Arran, 17-04-2024
Back on Arran and the sun actually shone (at least for a few hours)
I was back on the Isle of Arran za couple of weeks ago for my brother's 50th birthday celebrations (just about recovered) and took this pic while out for my daily early morning run. It's one of my better ones that captures the sun starting to rise over Ayrshire. It's a truism but worth repeating. You never fully appreciate how lucky you are to grow up on an island like Arran until you've been away for a while. Every year that passes, and every time I return, my gratitude increases.
I’m resisting talking about ferries as, well, you know, it gets me hot under the collar.
Thin or thick, how do you spread your jam? Thoughts on CleanTech R&D Spend
Imagine that you have a jar of jam in front of you. The jar is full of delicious blackberry jam. You’re very much looking forward to spreading the jam on some warm toast, maybe a crumpet and perhaps on a bagel. Life is full of choices, and this is one of the more enjoyable ones.
You want the jam to last for a while because you made it yourself and it’s the last one in the cupboard. You could of course buy more jam from the supermarket, but you don’t because it’s never nearly as good as the stuff you make yourself.
Decisions, decisions! What to spread the jam on and how much to spread? You know it tastes best on toast but needs to be spread fairly thickly so before you know it the jar will be empty. You could instead stick to eating crumpets as they don’t need as much jam to taste good, but they don’t sit so well in your stomach. Toast or crumpets? Spread thick or thin? That’s what your choices come down to.
These are low consequence decisions. They effect no-one but you. However, jam spreading acts as a metaphor to help us consider the choices that have been made and will continue to be made regarding CleanTech R&D spend.
I’ve “stolen” the jam spreading metaphor from the mouth of Dieter Helm, Professor of Economic Policy at the University of Oxford, and advisor on the energy economy to Prime Ministers from David Cameron to Boris Johnson. Professor Helm was a recent guest on Alastair Campbell and Rory Stewart’s “Leading” podcast.
Towards the end of the podcast, Professor Helm highlighted that one of his major energy policy concerns is that the UK Government has been spreading its R&D budget too thinly across too many technologies. In other words, placing bets on too many horses hoping that one will win.
However, unlike gambling, the money behind CleanTech R&D is coming from the public purse. Moreover, a gambling strategy that focuses on placing bets on many horses in the same race suggests that the gambler hasn’t done their research. They haven’t looked at the form guide and done a deep dive into each horse’s breeding.
At the heart of Professor Helm’s argument is the need for an industrial energy transition strategy where the jam is spread thicker on fewer technology areas. Specialism over generalism. Focus on a few technologies where the UK has the strongest chance of being a global leader.
In recent years, I’ve spent a lot of time working with the research community in UK universities, especially those in Scotland. These establishments are home to some of the brightest and most talented researchers you’ll find anywhere in the world. Their research is world leading and some of it has laid the groundwork for breakthroughs that create remarkable new products and services that conquer long standing medical and environmental challenges.
However, and this is where things get really theory and political, there is only so much public R&D funding to go round to support the research that private sector organisations deem too risky to fund themselves. Increasing the size of the public R&D pie means shrinking it in another area of the public sector. Politically, jam today takes priority over jam tomorrow. Funding for R&D falls into the tomorrow jam jar.
I’ve very recently had first-hand experience of this prioritisation process. Up until the end of March I was working on an e-mobility innovation programme for an energy transition R&D centre funded by the Scottish Government. With public finances being so tight, the Government decided to cut funding for this innovation programme with my role being one of the casualties.
More generally, public funding for R&D programmes across all areas of the energy transition is being reduced and reprioritised. Reduced as more money needs to be spent on “here and now” programmes such as healthcare and education. Re-prioritised towards R&D where the Government believes it will deliver the best long-term return.
In Scotland, the place I know best, this boils down to four clusters of R&D: Energy Transition; Health & Life Sciences; Data and Digital Technologies; and Advanced Manufacturing. These are the areas where funding will be targeted.
These four clusters cover a broad church of technologies so I would argue that somewhat inevitably the jam may end up being spread rather thinly. Take the Energy Transition cluster. Within the Scottish Government’s National Innovation Strategy published in 2023, it’s stated that focus will be placed on R&D and innovation programmes related to: Hydrogen Generation, Storage and Transport; Floating Offshore Wind; Built Environment Transition; and the Decarbonisation of Transport.
That’s an ambitious set of goals. Can Scotland, never mind the UK be a leader in all these areas? To be clear, this doesn’t mean being a leader in the early stages of R&D. No doubt as mentioned above, we have the expertise within our universities, and we should shout about it. Instead, leading means producing businesses that scale, create new, well-paying jobs that benefit local communities, and increase the overall productivity of the economy.
For this to come true, we need to be brave enough to say no more often (stop chasing as many shiny objects as possible), invest grant funding for R&D more intelligently, specifically on a smaller number of businesses who have the best chance of scaling but are stuck between the middle and later stages of technology and commercial readiness.
I believe Professor Helm is correct in his analysis. The jam needs to be spread thicker.
Current Reading (& Re-Reading) List
My current reading sugar rush generally comes from books about economics, energy and the environment.
Captial - Thomas Piketty: A long read on the history of wealth inquality. Enlighenting and depressing in equal parts. Will we ever be able to spread wealth more equally?
The Price is Wrong - Brett Christopers: Released at the start of 2024. Does a really good job of highlighting the paradox of renewable energy economics.
How the World Really Works - Vaclav Smil: A must read. A brutally honest assessement from one of the world’s foremost scientists on the true costs and challenges of transitioning to net-zero.
Cobalt Red - Siddharth Kara: Only by risking your life (a little) and visiting the Democratic Republic of the Congo’s cobalt mines do you understand the human cost of EV battery production. Siddharth Kara did just that and his book makes for very disturning reading.