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By Matthew Stepp on May 17, 2013 with 3 responses

The Impact of Budget Sequestration on DOD Energy Innovation

The impacts of budget sequestration are slowly being unveiled to the general public. Furloughs at the Federal Aviation Authority (FAA) led to air traffic gridlock and angry travelers. Parks and national tourist sites are cutting back hours. And the Department of Defense (DOD) recently announced furloughs for 680,000 civilian employees. While these short-term impacts are painful, in particular to those losing work hours and income, sequestration is initiating cuts with negative, long-term impacts, which are not yet immediately apparent.

One area of specific concern is the potential $381 million in cuts to energy innovation investments at the DOD – a 25 percent cut compared to FY2012 levels. Since 2009, DOD has invested $5 billion in clean energy research, development, testing, demonstration, and procurement, representing almost 25 percent of U.S. clean energy funding in FY2012. DOD’s focus on clean energy innovation is important for three reasons:

  • The DOD has been the source of some of the last century’s most important breakthrough technologies, including the Internet, GPS, and microchips and it could have a similar impact on clean energy technologies like batteries and smart grid;
  • The DOD has developed its own cohesive innovation ecosystem that bridges its investments in research to its procurement budget and actual use of new technologies in the battlefield, which allows for accelerated pathways for technology development;
  • The DOD budget is typically not politically controversial in comparison to other sources of energy innovation investment like the Department of Energy, assuring consistent funding over time rather than periods of boom and bust.

During the past five years DOD has quickly ramped up its energy innovation investments to address strategic challenges impacting warfighters, such as protecting liquid fuel supply lines and addressing the geopolitical consequences of climate change. But budget sequestration threatens to slow, or even halt, these efforts.

(RelatedFuture of DoD’s Biofuels Program Should Not Be Sacrificed to Tight Budgets)

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By Matthew Stepp on May 10, 2013 with 1 response

Climate Hawks Should Aggressively Support the America COMPETES Act

Making Innovation Part of Climate Hawks Policy Pitch

energy labIn a previous article I argued that climate policy advocates should make energy innovation part of their policy elevator pitch. A good opportunity to start is now available through the debate on reforming and re-authorizing the America COMPETES Act.

Within the climate advocacy community there are those that argue for aggressive clean energy innovation policy (such as myself) and those that argue for aggressive deployment of existing clean energy technologies (such as Center for American Progress’s Joe Romm and 350.org’s Bill McKibben). Each provides different policy emphasis and nuance. Today, deployment policies receive higher priority, reflected in it dominating the narrative among advocates as well as dominating the portfolio of U.S. public investments in clean energy. As a result, conflict occurs over what policy changes should be made.

As Grist’s Dave Roberts argues (correctly to a degree), both “camps” agree on a lot and everyone should aggressively work for clean energy to be a national priority to “lift all boats,”—both innovation and deployment of today’s technologies alike. How then should this consensus be reflected in our pitches to policymakers?

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By Matthew Stepp on May 3, 2013 with no responses

DOE Proposes Expanding High Impact Energy Innovation Incubator Program

Buried in the President’s FY2014 budget proposal is an interesting reform that could impact energy innovation without relying on Congress for any new – and hard to come by – federal investments. The idea is to create eight new research incubator programs at the Department of Energy that forge collaborations with early-stage start-ups to bring promising new ideas closer to commercial scale. In particular, the incubators would focus on promising technology pathways DOE is not currently investing in.

The incubator programs would be housed within each of the energy technology offices (except for geothermal) and leverage a small share of existing research budgets. The figure below provides the proposed budgets for the new incubators. (Note, the DOE is also continuing its existing solar incubator program.)

IncubatorChart

Each incubator is expressly aimed at emerging areas of research and technology development not “supported in any meaningful” way by existing DOE projects.

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By Matthew Stepp on Apr 26, 2013 with 8 responses

Thomas Friedman’s Evolving Support for an Innovation Carbon Tax

Bringing together climate policy and innovation to form a cohesive carbon tax proposal reframes U.S. climate advocates’ near-myopic focus on carbon pricing, mandates, and subsidies and expands the discussion on how we can use those tools to spur innovation, writes Matthew Stepp.

By Matthew Stepp on Apr 18, 2013 with 4 responses

Finding a New Direction in Climate Change Policy

It’s clear that the world is losing the race against global climate change. The International Energy Agency put numbers to this fact in a new report, Tracking Clean Energy Progress 2013, which finds that, “the amount of CO2 emitted for each unit of energy supplied has fallen by less than one percent since 1990.” In other words, for all of the global growth in renewable energy in the last decade, the world continues to rely on fossil fuels to the detriment of more global warming. Of course, this has to change and change fast.

This past weekend, I participated in a day-long symposium at Villanova University aimed at discussing what kind of changes need to be made. The conference hook was brought on by Rutgers Law Professor Howard Latin who provided the keynote address based on a book he published late last year titled Climate Change Policy Failures that argues conventional climate policy approaches fought for during the last twenty years such as cap-and-trade, international negotiations, and emission regulations won’t successfully produce deep carbon reductions. Latin contends that these “incremental” policy approaches simply kick the emission reduction can down the road and offer little support for aggressive carbon cuts. It’s worth a read.

An interesting cross-section of economists, environmental lawyers, systems engineers, and policy analysts — including myself — were tasked with responding to Professor Latin’s keynote with their perspective on where do we go from here and how this is playing out in today’s policy debate?  I’m posting a summary of the policy portion of my remarks below as a means to not only keep the discussion going, but also to put into context some of the important policy debates ongoing in Congress.

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By Matthew Stepp on Apr 11, 2013 with 1 response

Obama’s Budget Boosts Support for Energy Innovation

President Obama released his long-awaited FY2014 budget request and while it’s unlikely the budget will be taken up by Congress in its entirety, it remains an important document. Namely, the proposal is significant because it steadfastly argues that America can continue to support next-generation industries like clean energy. In fact, the President’s proposal budgets for a number of high-profile, high-impact programs, including those aimed at growing the domestic clean energy manufacturing sector, reduce transportation fuel use, and calls on Congress to fund a new Energy Innovation Hub to transform the electricity grid.

Across the board, the FY2014 request boosts key energy innovation offices at DOE by about 15 percent compared to the FY2013 Continuing Resolution and seven percent higher than the President’s FY2013 request. The lion’s share of budget gains are aimed at the Office of Energy Efficiency and Renewable Energy (EERE), which would see a budget increase of 54 percent from FY2013 CR levels, and at the Advanced Research Projects Agency-Energy (ARPA-E),  which would see a budget increase of 46 percent.

Expanding Research Capabilities in Advanced Energy Manufacturing

The largest budget increase target at EERE – 22 percent to be exact – is for the department’s Advanced Manufacturing Office, which invests in transformational research and development of integral clean energy manufacturing technologies and practices. This investment would support and complement EERE’s recently announced Clean Energy Manufacturing Initiative, which aims to aggressively increase the international competitiveness of emerging energy manufacturing. The program is designed to begin reversing a decade’s long decline in U.S. manufacturing – immediate goals include transferring new research, technologies, and industrial education and training to industry through a new research institute under the banner of the President’s National Network of Manufacturing Innovation as well as EERE’s Better Plants Challenge.

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By Matthew Stepp on Apr 5, 2013 with no responses

Globalizing the ARPA-E Model: Talking Energy Innovation with ARPA-E’s Cheryl Martin

Cheryl-Martin-arpa-eI recently sat down with Dr. Cheryl Martin, the Deputy Director of ARPA-E, the federal government’s premier program for investing in high-risk, high-reward energy research and development. The interview covered a lot of ground and touched on different aspects of America’s energy innovation ecosystem, so I’ve published it in cohesive parts, lightly edited. This post wraps up the interview.

In part 1, Dr. Martin took a deep-dive into the lessons ARPA-E has learned in its few short years of existence. In part 2, we covered ARPA-E’s efforts to link research and emerging technologies to the marketplace. In part 3, we expanded that conversation to cover ways states and regions can collaborate with ARPA-E to move research to the market.

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By Matthew Stepp on Mar 28, 2013 with no responses

Linking States to Federal Energy Research: Talking Energy Innovation with ARPA-E’s Cheryl Martin

arpa-e-bloomberg

I recently sat down with Dr. Cheryl Martin, the Deputy Director of ARPA-E, the federal government’s premier program for investing in high-risk, high-reward energy research and development. The interview covered a lot of ground and touched on different aspects of America’s energy innovation ecosystem, so it’s being published as a multi-part series, lightly edited, and broken up into cohesive topics.

In part 1 of the interview, Dr. Martin took a deep-dive into the lessons ARPA-E has learned in its few short years of existence. In part 2, we covered ARPA-E’s efforts to link research and emerging technologies to the marketplace. In particular, Dr. Martin discussed the independent path ARPA-E is traveling by building relationships with potential end-users of emerging energy technologies, like companies, the Department of Defense, and utilities such as Duke Energy.

But one potential partner often not discussed at length in national energy policy discussions is states. States are in many ways more active in the clean energy space than the federal government, in particular on technology deployment policies. Over 20 states have created clean energy trust funds supported by dedicated revenue streams like public benefit charges. Thirty states and the District of Columbia have enacted renewable portfolio standards and another eight states have set voluntary clean energy market share goals. Almost half of all states offer clean energy tax credits or grant programs. And 41 states offer various forms of clean energy loan programs. CONTINUE»

By Matthew Stepp on Mar 26, 2013 with no responses

Linking Research to Market: Talking Energy Innovation with ARPA-E’s Cheryl Martin

arpa-e-bloomberg

I recently sat down with Dr. Cheryl Martin, the Deputy Director of ARPA-E, the federal government’s premier program for investing in high-risk, high-reward energy research and development. The interview covered a lot of ground and touched on different aspects of America’s energy innovation ecosystem, so it’s being published as a multi-part series, lightly edited, and broken up into cohesive topics. In part 1 of the interview, Dr. Martin took a deep-dive into the lessons ARPA-E has learned in its few short years of existence.

In part 2, we cover a pervasive issue in innovation policy: linking research and emerging technologies to market. In particular, a major concern of ARPA-E is that doesn’t have a dedicated end-user that’s going to procure emerging technologies, like DARPA has at the Department of Defense (DOD). DARPA is ARPA-E’s kindred spirit and many opine that until it gains a large-scale early adopter, its impact won’t reach that of its defense brethren because it won’t be able to bridge the technology “valleys-of-death” that plague many new innovations from reaching commercial scale. CONTINUE»

By Matthew Stepp on Mar 22, 2013 with 2 responses

ARPA-E’s Lessons Learned: Talking Energy Innovation with ARPA-E’s Cheryl Martin

arpa-e-bloomberg

Dr. Cheryl Martin is the Deputy Director of ARPA-E, the federal government’s premier program for investing in high-risk, high-reward energy research and development. She’s the heir apparent to Arun Majumdar, the first Director of ARPA-E who departed last year after helping spin-up the program and bring it to national prominence.

She assumes leadership less than four years into ARPA-E’s existence at an inflection point for the program as well as U.S. climate and energy policy. On one hand, government investments in energy innovation are declining and gridlock makes crafting a new comprehensive national energy policy a pipedream. On the other hand, ARPA-E recently hosted its fourth widely attended Energy Innovation Summit, a number of early investments are starting to show signs of success, and its bipartisan support continues to grow. It’s one of the few bright spots in an increasingly contentious energy policy debate.

I recently sat down with Dr. Martin and talked extensively about her unique take on ARPA-E, its potential legacies, and the evolving U.S. energy innovation ecosystem. The interview covered a lot of ground so it will be published as a multi-part series, lightly edited, and broken up into cohesive topics.

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