The Energy Race: Will federal budget woes affect progress?

Secretary of Energy, Steven Chu, was in Colorado last week, and after months of reeling from the Solyndra debacle, was able to bask in the glow of successful DOE investments. Chu also used the trip to hammer home his messages of innovation and US manufacturing.

Chu’s first stop was at GE’s PrimeStar Solar plant in Arvada, Colo. PrimeStar is building a large manufacturing plant in Aurora, Colo. that will make enough solar modules to power 80,000 homes, according to an NREL press release. GE is investing $600 million in the plant, which makes good on its promise earlier this year to generate 400 jobs.

The press release says PrimeStar’s cadmium-telluride solar panel technology leverages a $3 million investment by DOE “so the experts at NREL’s solar incubator program could help PrimeStar develop the technology to pilot scale.” Who could argue with a $3 million to $600 million conversion?

At PrimeStar Chu built on his theme of innovation,

“Global business in renewable energy last year was $240 billion,” Chu noted. “It’s destined to grow by leaps and bounds. By 2030 it should be $460 billion a year.

“That’s $5 trillion to $7 trillion—a huge market potential.

“It’s very important that we stay in this game,” Chu said. “Is it a game we can win? Absolutely.

“Because of our technological edge, we can be competitive with anyone in the world” if research and development is funded adequately.

And, what is adequate funding of research and development? It’s starting to sound like apple pie—all agree on its value, but there is plenty of squabbling over the recipe.

In the Nov 18 issue of Science Bill Gates has an editorial piece called “The Energy Research Imperative.” He says “The United States is uniquely positioned to lead in energy innovation, with great universities and national laboratories and an abundance of entrepreneurial talent. But the government must lend a hand.” He says that “government investment in energy innovation has dropped by more than 75 percent” in the last 30 years.

The American Energy Innovation Council, a small group of business leaders that includes Gates, has called for the federal government to increase its funding of energy R&D from $5 billion to $16 billion per year.

That’s not going to happen. Yesterday’s failure of the congressional “supercommittee,” which was tasked with finding $1.2 trillion in deficit reductions effectively guarantees no meaningful increases in federal R&D budgets. Now, the law automatically requires that all discretionary spending remain static for the next two budget years and calls for cutting $917 billion over the next ten years, which could mean cuts to R&D budgets in the range of 7-11 percent.

Instead of increasing, energy investment, at least in the SOFC sector, will decrease again when DOE pulls the plug on SECA funding, as we reported last week.

Where that leaves us is unclear. The consistent message out of the funding agencies for the last several months has been innovation to create jobs. In Colorado, while at NREL, Chu said “We haven’t lost our stature in terms of our ability to invent and innovate. But when I see what other countries are doing in terms of support … we have to remember: ‘Are we in this to win?'”

Chu says there is a $5-7 trillion market potential for renewable energy. That’s a mighty big pie. It may be that private investors and industry will have to be more proactive than they’ve been and not let federal funds decide what the winning technologies are going to be. GE’s $600 million investment is encouraging, as are other indicators, like 1366 Technologies‘ ability to raise private capital. Chu is hoping to convince Congress to continue to fund energy research, which he should. That’s his job. I’d like to see Bill Gates take the message to his corporate peers to invest more aggressively, rather than pound the feds for more money.

There are two important meetings in February 2012 that will be of interest to the segment of our community engaged in energy research, and unfortunately, they overlap.

The Materials and Challenges in Alternative and Renewable Energy 2012 (Feb 26-March 1, Clearwater, Fla.) is a technical meeting cosponsored by ACerS, ASM, TMS and SPE. This will be the meeting to attend for those responsible for “doing” innovation and engineering new energy technologies into realities. The technical program includes symposia specific to a wide range of new energy technologies, such as wind, solar, batteries, nuclear and much more.

ARPA-E’s 2012 Energy Innovation Summit (Feb. 27-29, Washington, DC) seems to be geared more toward strategists and business development types. Keynote speakers include a cadre of big names from large, successful businesses like Gates, Ursula Burns from Xerox, Fred Smith from FedEx and Lee Scott of Walmart, who will, according to an earlier press release, “share ideas for developing and deploying the next generation of clean energy technologies.” There will also be a showcase highlighting recent winners of ARPA-E funded projects.

Are we in this to win? I hope so.