Varun Rai

Diffusion of environmentally-friendly energy technologies: buy versus lease differences in residential PV markets

Diffusion of microgeneration technologies, particularly rooftop photovoltaic (PV), represents a key option in reducing emissions in the residential sector. We use a uniquely rich dataset from the burgeoning residential PV market in Texas to study the nature of the consumer’s decision-making process in the adoption of these technologies. In particular, focusing on the financial metrics and the information decision makers use to base their decisions upon, we study how the leasing and buying models affect individual choices and, thereby, the adoption of capital-intensive energy technologies. Overall, our findings suggest that the leasing model more effectively addresses consumers’ informational requirements and, contrary to some other studies, that buyers and lessees of PV do not necessarily differ significantly along socio-demographic variables. Instead, we find that the leasing model has opened up the residential PV market to a new, and potentially very large, consumer segment — those with a tight cash flow situation.

Effective Information Channels for Reducing Costs of Environmentally-Friendly Technologies: Evidence from Residential PV Markets

Realizing the environmental benefits of solar photovoltaics (PV) will require reducing costs associated with perception, informational gaps and technological uncertainties. To identify opportunities to decrease costs associated with residential PV adoption, in this letter we use multivariate regression models to analyze a unique, household-level dataset of PV adopters in Texas (USA) to systematically quantify the effect of different information channels on aspiring PV adopters’ decision-making. We find that the length of the decision period depends on the business model, such as whether the system was bought or leased, and on special opportunities to learn, such as the influence of other PV owners in the neighborhood. This influence accrues passively through merely witnessing PV systems in the neighborhood, increasing confidence and motivation, as well as actively through peer-to-peer communications. Using these insights we propose a new framework to provide public information on PV that could drastically reduce barriers to PV adoption, thereby accelerating its market penetration and environmental benefits. This framework could also serve as a model for other distributed generation technologies.

Agent-based modeling of energy technology adoption

Agent-based modeling (ABM) techniques for studying human-technical systems face two important challenges. First, agent behavioral rules are often ad hoc, making it difficult to assess the implications of these models within the larger theoretical context. Second, the lack of relevant empirical data precludes many models from being appropriately initialized and validated, limiting the value of such models for exploring emergent properties or for policy evaluation. To address these issues, in this paper we present a theoretically-based and empirically-driven agent-based model of technology adoption, with an application to residential solar photovoltaic (PV). Using household-level resolution for demographic, attitudinal, social network, and environmental variables, the integrated ABM framework we develop is applied to real-world data covering 2004-2013 for a residential solar PV program at the city scale. Two applications of the model focusing on rebate program design are also presented. We develop an integrated agent-based model of residential solar adoption.Model is based upon a theoretically-driven behavioral model and data collection.Multiple data-streams are merged to enable empirical initialization of agent states.We use a technology-specific social network, leveraging observed geographic patterns.Model is validated using multiple (temporal, spatial, and demographic) criteria.

Deconstructing Solar Photovoltaic Pricing: The Role of Market Structure, Technology, and Policy

Author(s): Gillingham, Kenneth; Deng, Hao; Wiser, Ryan; Darghouth, Naim; Nemet, Gregory; Barbose, Galen; Rai, Varun; Dong, C.G.

Public Perceptions and Information Gaps in Solar Energy in Texas

Studying the behavioral aspects of the individual decision-making process is important in identifying and addressing barriers in the adoption of residential solar photovoltaic (PV). However, there is little systematic research focusing on these aspects of residential PV in Texas, an important, large, populous state, with a range of challenges in the electricity sector including increasing demand, shrinking reserve margins, constrained water supply, and challenging emissions reduction targets under proposed federal regulations. This paper aims to address this gap through an empirical investigation of a new survey-based dataset collected in Texas on solar energy perceptions and behavior. The results of this analysis offer insights into the perceptions and motivations influencing intentions and behavior toward solar energy in a relatively untapped market and help identify information gaps that could be targeted to alleviate key barriers to adopting solar, thereby enabling significant emissions reductions in the residential sector in Texas.

Energy and India's Foreign Policy

The study explores the role of energy in India’s foreign policy strategy and examines the wide gap between India’s need for a strategic energy policy and the government of India’s inability to put such a policy into practice. As a stark departure from the idealized vision, India’s energy supply chains that have grown increasingly creaky and unreliable. Only halting progress has been made towards reform and, without fundamental reform, it is likely that India’s global energy strategy will continue to be a failure.In particular, the authors examine the relationship between India’s energy policy and its foreign policy by highlighting both themes and vignettes in three different areas of the energy system: oil & natural gas, coal, and electricity. They find that fickle domestic political coalitions dominate energy policymaking in India and that these unstable coalitions, when combined with the weak administrative capacity of the Indian state, leave India’s foreign policy apparatus incapable of making credible commitments in the energy sector.

The Real Drivers of Carbon Capture and Storage In China and Implications for Climate Policy

The capture and permanent storage of CO2 emissions from coal combustion is now widely viewed as imperative for stabilization of the global climate. Coal is the world’s fastest growing fossil fuel. This trend presents a forceful case for the development and wide dissemination of technologies that can decouple coal consumption from CO2 emissions - the leading candidate technology to do this is carbon capture and storage (CCS). China simultaneously presents the most challenging and critical test for CCS deployment at scale. While China has begun an handful of marquee CCS demonstration projects, the stark reality to be explored in this paper is that China’s incentives for keeping on the forefront of CCS technology learning do not translate into incentives to massively deploy CCS in power plant applications as CO2 mitigation scenarios would have it. In fact, fundamental and interrelated Chinese interests - in energy security, economic growth and development, and macroeconomic stability - directly argue against large-scale implementation of CCS in China unless such an implementation can be almost entirely supported by outside funding. This paper considers how these core Chinese goals play out in the specific context of the country’s coal and power markets, and uses this analysis to draw conclusions about the path of CCS implementation in China’s energy sector. Finally, the paper argues that effective climate change policy will require both the vigorous promotion and careful calculation of CCS’s role in Chinese power generation. As the world approaches the end of the Kyoto Protocol in 2012 and crafts a new policy architecture for a global climate deal, international offset policy and potential US offset standards need to create methodologies that directly address CCS funding at scale. The more closely these policies are aligned with China’s own incentives and the unique context of its coal and power markets, the better chance they have of realizing the optimal role for CCS in global climate efforts.

Expert elicitation methods for studying technological change under uncertainty

The recent study by Anadon et al (2013 Environ. Res. Lett. 8 034020) employs multiple expert elicitation to study the potential impact of public RD&D on nuclear power costs through 2030. This study achieves a rare depth and variation in multiple expert elicitation on the same problem, which allows the authors to carefully identify expert-level drivers of variations in assessments of outcomes and associated uncertainties. An important parameter—change in the future costs of nuclear fission technologies upon doubling of public RD&D—is also calculated. Overall, this study makes a significant contribution to both the decision-making under uncertainty literature focusing on technological change as well as the expert elicitation methodology literature.

Venture Capital in Clean Energy Innovation Finance: Insights from the U.S. Market during 2005-2014

Since emerging as a capital destination in the late 1990s, the experience of venture capital (VC) in clean energy technologies (CET) has been checkered. Haphazard investment activity in the early 2000s paired with high-profile failures of once-promising CET ventures to produce a general reticence toward CETs in the investment community. Since then, attitudes regarding the potential for financial venture capital or public policy to meaningfully reintroduce vigor in CET innovation have been characterized by skepticism, in no small part due to notions of capital intensity and policy risk formed during the initial waves of CET investment. Despite its importance, there has been little systematic research of CETs vis-a-vis venture capital, public policy, or the broader investment system. In this paper we revisit this area of inquiry, focusing on the role of venture capital in funding innovation in clean energy, especially in light of the lessons learned over the past decade in the U.S. The core data for our analysis comes from a series of in-depth, semi-structured expert interviews with individuals from venture capital firms, relevant public agencies, corporate venture capital entities, as well as for-profit and not-for-profit investment houses, all of whom were active in the CET space before, during, and after the peak of CET in the late 2000s. We reevaluate common notions regarding the drivers and barriers of VC and strategic corporate investment in CETs and uncover several nuanced insights that inform approaches for addressing barriers to unlocking the full potential of VC in funding clean energy innovation.

PESD Carbon Storage Project Database

Carbon capture and storage (CCS) is among the technologies with greatest potential leverage to combat climate change. According to the PRISM analysis, a technology assessment performed by the Electric Power Research Institute (EPRI), wide deployment of CCS after 2020 in the US power sector alone could reduce emissions by approximately 350 million tonnes of CO2 per year (Mt CO2/yr) by 2030, a conclusion echoed by the McKinsey U.S. Mid-range Greenhouse Gas Abatement Curve 2030. But building CCS into such a formidable climate change mitigation “wedge” will require more than technological feasibility; it will also require the development of policies and business models that can enable wide adoption. Such business models, and the regulatory environments to support them, have as yet been largely undemonstrated. This, among other factors, has caused the gap between the technological potential and the actual pace of CCS development to remain large.The purpose of the present work is to quantify actual progress in developing carbon storage projects (here defined as any projects that store carbon underground at any stage of their operation or development, for example through injection into oil fields for enhanced recovery or in saline aquifers or other geological formations). In this way, the real development ramp may be compared in scale and timing against the perceived need for and potential of the technology. Some very useful lists of carbon storage projects already exist – see, for example, the IPCC CCS database, the JP Morgan CCS project list, the MIT CCS database, and the IEA list. We seek to maintain an up-to-date database of all publicly-announced current and planned projects from which we can project a trajectory of carbon stored underground as a function of time. To do this, we estimate for each project the probability of completion as well as the potential volume of CO2 that can be stored as of a given year.