Amortizing fund financing for applied research, development, and demonstration of advanced electric energy production and distribution systems

Abstract

Advanced electric energy production and distribution technologies are needed to replace conventional systems that have adverse environmental, safety, and economic features. This need is global and is recognized by the energy community. In most cases, the major barrier to these technologies is sufficient development to demonstrate their costs. Any new technology must be economically competitive with existing systems, with all external costs being internalized. These technologies include advanced power production such as solar electric, passively safe nuclear fission, coal-fired MHD, and nuclear fusion. Other examples are superconducting energy storage, transmission systems and generators. Ultimate fission waste disposal (e.g., nuclear incineration) is also included as an advanced electric energy technology. The demonstration of these technologies requires long-term applied R D programs with a stable funding environment. For many years, the public sector has emphasized basic science and technology while the private sector has focused on the production of marketable goods. This has resulted in a funding gap for the demonstration of major electric production and distribution technologies, thus blocking their introduction into electric utility systems and the export market. An amortizing fund approach is proposed to bridge this gap. This approach is based on historically conservative economic principles, and has significantmore » precedence in the electric utility industry. It also closely connects the revenue source with the objectives of the disbursement of the funds. An amortizing fund, established from a very small investment fee such as one mill per kilowatt-hour on the purchase of electricity, would be paid by consumers. A Federally Chartered organization, staffed by professionals recruited principally from the electric utility and related industries, would manage the fund.« less