FEEM working papers "Note di lavoro" series
2014 .092

Clean Energy - Bridging to Commercialization: The Key Potential Role of Large Strategic Industry Partners


Authors: Lawrence M. Murphy, Ron Ondechek Jr., Ricardo Bracho, John McKenna
Series: Energy: Resources and Markets
Editor: Giuseppe Sammarco
Keywords: Clean Energy, Strategic Industry Partners, High Cost Technology Development, Commercialization
JEL n.: Q42, Q49, G24

Abstract

This white paper explores a range of potentially attractive partnerships, including those between established US industry members, the entrepreneurial CE (clean energy) community, and the financial industry. These partnerships, include those that can leverage a wide range of entrepreneurial and industry resources that are needed to promote the development and commercialization of innovative new technologies - partnerships that in turn can lead to accelerated, global utilization of CE, as well as US global leadership for the CE industry. The need for these partnerships is discussed within the context of the growing interest in CE, driven in large part by the anticipated strong, global growth in energy demand, as well as by the need for a spectrum of other long term (e.g. environmental) benefits from CE. The impacts of the rapidly changing investment and the market environment for innovative CE technologies, are also explored.
The strong need for multifaceted enabling partnerships and resources are found to go well beyond those corresponding to financing, and includes for example, expertise on markets and market creation, and product development. In addition, deep resource levels are often especially needed in the pursuit of high potential, next generation CE innovative supply technologies that require costly technology development. Such is the case for example, where sophisticated manufacturing approaches are needed to exploit promising, and high performance, material combinations along with novel and complex technology based hardware. Further, access to adequate resources for the needed, high cost, technology development is increasingly less likely to be available from traditional partners such as VCs and their limited partners. Of the key potential partners explored, Strategic Industry Partners (SIPs) are found to be particularly intriguing - they have the most robust range of appropriate resources to potentially benefit from these partnerships while also helping to fill the void in the commercialization food chain for technology development, where VC funding is not available. SIPs also play a broad enabling role for the growth of the entrepreneurial US based, CE industry. Moreover, SIPs also have the required stature and influence to impact global markets as well as to promote global US leadership in CE, while also contributing to the dialogue around public-private partnerships. While SIPs have stringent requirements for partnering, as well as intense competition for their resource investments, successfully pursuing mutually attractive partnerships with SIPs should be well worth the required effort.

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Suggested citation: Murphy, L. M., R. Ondechek Jr., R. Bracho, J. McKenna, (2014), 'Clean Energy - Bridging to Commercialization: The Key Potential Role of Large Strategic Industry Partners', Nota di Lavoro 92.2014, Milan, Italy: Fondazione Eni Enrico Mattei.

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