Commercial Readiness Index (CRI) assessment – using the method as a tool in renewable energy policy design

Technical development of emerging RETs on their journey from basic technology research to proven function is generally assessed by the Technology Readiness Levels (TRLs) index. However, beyond technical development, RETs also need to prove their commercial viability. Responding to this challenge, the Australian Renewable Energy Agency (ARENA) developed a novel framework to evaluate commercial readiness of RETs: the Commercial Readiness Index (CRI).

In a study commissioned by the IEA-RETD, the commercial maturity of renewable energy technologies (RETs) is assessed using the Commercial Readiness Index (CRI) framework to identify appropriate policy approaches for stimulating RET deployment. The resulting report, prepared by the Carbon Trust, explores the use of the CRI framework through case studies with the aim of illustrating the commercialisation journey of two RETs in two different contexts: solar photovoltaics (PV) in Germany and offshore wind in the UK. These case studies included detailed interviews with 20 experts from 15 organisations and an internal workshop with Carbon Trust’s technology commercialisation experts. The report draws conclusions and provides recommendations on three main aspects:

Advantages and limitations of the CRI and its potential applicability to support policy makers

The CRI is an effective tool for communicating the importance of market conditions beyond technical performance for RETs and illustrating the historical commercialisation journey of a technology. The indicators assessed through the CRI help to prompt policy makers to consider a range of barriers faced by RETs and it can be used to show which historical policies were effective, or not, at addressing these commercialisation barriers. However, the CRI as a stand-alone tool does not direct policy makers towards the policy options that could be implemented to address these barriers.

Effective policies to support the commercialisation of RETs

The CRI emphasises, in the two case studies, that the most significant policies for scaling both emerging RET markets were subsidies for electricity production that were not limited by a capacity cap. However, the CRI analysis does not indicate why these policies were successful nor can it generalise lessons from various contexts given the unique set of individual circumstances in each case.

Opportunities to refine the CRI to address some of its limitations

The study proposes some modifications to the CRI which build on the existing framework to make it more useful and applicable for policy makers looking to scale-up renewable energy technologies. Suggestions include the introduction of new indicators that would capture or provide a more comprehensive view of additional commercialisation barriers faced by RETs, the creation of a traffic light system that could show the priority areas requiring policy support, or yet indicators linked to possible policy interventions that could address specific technology commercialisation barriers.

Download the report for the detailed findings of the project.