Last week, President Obama visited an advanced battery factory in Jacksonville, Florida.As part of the clean-energy revolution thatâ€™s creating jobs and making our planet safer and more secure at the same time, this factory makes cutting edge energy-storage technology that will continue to help integrate new power sources into the electric grid.This week, American clean-energy leadership is also on display at the annual summit of the Department of Energyâ€™s (DOE) Advanced Research Projects Agency-Energy (ARPA-E).Over the past seven years, ARPA-E has invested in 475 transformative energy technologies that have secured over $1.25 billion in cumulative follow-on funding from the private sector.
Our progress on clean energy:
Solar power: â†‘ more than 30x
Wind power: â†‘ threefold
Oil imports: â†“ nearly 60%https://t.co/ESpewxu09F
— The White House (@WhiteHouse) February 26, 2016
These milestones were made possible seven years ago, when President Obama signed the American Recovery and Reinvestment Act (Recovery Act).Not only did the Recovery Act stimulate the economy and raise GDP by an estimated 2-3 percent following the depths of the Great Recession, but it also made the largest single investment in clean energy in history, providing more than $90 billion in strategic clean-energy investments and tax incentives to accelerate job creation and the deployment of low-carbon technologies.
This historic investment toward a 21st century clean-energy economy included the seed funding for ARPA-E, a new agency within DOE with the mission to advance potentially transformational energy technologies that are too early in their development to attract private-sector investment.ARPA-Eâ€™s projects, many on display this week at the annual summit, include entirely new ways to generate, store, transform, and use energy â€“ from an airborne wind turbine that transmits electricity from the sky; to liquid-flow batteries that provide grid storage and flexibility; to bio-engineered organisms that can make fuel directly from electricity, hydrogen, and carbon dioxide.
We need to double down on these core investments to maintain American leadership and accelerate the transition to a clean-energy economy.Thatâ€™s why the Presidentâ€™s FY2017 Budget proposes todouble funding for clean-energy research and development (R&D)over the next five years, from $6.4 billion in Fiscal Year (FY) 2016 to $12.8 billion in FY 2021, to meet the U.S. commitment to the landmark 20-nationMission Innovationinitiative announced at the Paris climate summit.This expansion of clean energy R&D, which is in line with the recommendations of numerous expert studies, would include a tripling of ARPA-Eâ€™s budget to approximately $1 billion in 2021.
Beyond these essential government investments in R&D, we need more private-sector investment in new clean-energy technologies on their way from the laboratory to the commercial marketplace.While global private investment in commercial technologies like wind and solar surged last year to an all-time high, global private investment in early-stage clean energy has not kept pace.Thatâ€™s why at last yearâ€™s ARPA-E summit, White House Senior Advisor Brian Deese announced the Clean Energy Investment Initiative, an Administration effort to catalyze and expand private-sector investment in solutions to climate change, including innovative technologies with breakthrough potential to reduce carbon pollution.
One year later, the Clean Energy Investment Initiative has yielded a promising roster of private-sector commitments and complementary executive actions, including:
- The Department of Energyâ€™s new Clean Energy Investment Center (CEIC) opened for business and has already made substantial progress in its mission to advance private, mission-oriented investment in clean energy technologies.The CEIC is currently building a Lab Partnering Service that will facilitate direct, single-point access for the public to the rich clean-energy technology expertise of the National Laboratories, and just released a Request for Information as an opportunity for the public to inform its future priorities and objectives.
- The Treasury Department published new guidance to clarify that foundations are permitted to make certain mission-related investments (MRIs) in companies that further the foundationâ€™s charitable purposes. Some long-term investments in climate solutions, including clean-energy technologies that can yield market returns after a relatively long period of illiquidity, may be attractive MRIs for foundations seeking to reduce carbon emissions or prevent climate change.A final rule facilitating program-related investments by charitable foundations is coming soon, too.
- The Department of Labor published new guidance clarifying that environmental, social, and governance factors may have a direct relationship to the economic and financial value of an investment for certain pension funds, and thus may be proper components of the fundâ€™s analysis of the economic and financial merits of competing investment choices.
- Lawrence Berkeley National Laboratory (LBNL) is announcing its second cohort of clean energy research teams at Cyclotron Road, a new home for entrepreneurial researchers to advance energy technologies until they can succeed beyond the research lab.
- More than $4 billion has been committed by major foundations, institutional investors, and other long-term investors to scale up clean-energy innovation and climate change solutions, including several new clean energy investment collaborations that aim to significantly reduce the transaction costs of investing in early- and growth-stage technologies.
The full path to market for a new clean energy technology â€“from an â€œahaâ€ moment in a scientific laboratory to a complex system installed at scale â€“ can take decades and involve hundreds of individual inventions, improvements, and optimizations.The Presidentâ€™s ambitious actions to cut carbon pollution will ensure that America takes a comprehensive approach to the climate technology challenge, including a balanced mix of basic science, applied research and development, lab-to-market support, and incentives for widespread deploymentâ€“including smart pollution standards that reward innovation in cutting emissions.
Thanks to principled American leadership, nearly 200 countries adopted the most ambitious climate change agreement in history, sending a powerful signal to global markets that technology innovation and low-carbon infrastructure investments will continue to reinforce one another in the decades to come.The Paris climate summit also marked the launch of the Breakthrough Energy Coalition, an independent initiative announced alongside Mission Innovation consisting of 28 influential investors from 10 countries pledging to invest extraordinary levels of private capital in early-stage clean-energy innovations.
Now more than ever, the stage is set for rapid progress toward a low-carbon economy, with momentum building all along the innovation pipeline.
Dr. John P. Holdren is Assistant to the President for Science and Technology and Director of the Office of the Science and Technology Policy.
Dan Utech is Deputy Assistant to the President for Energy and Climate Change.