February 28, 2012 | By Bill Gates
ARPA-E: A Good Beginning for U.S. Energy Innovation
ARPA-E is a new government agency that’s fast-tracking development of new clean energy technologies. Although I believe the federal government should invest even more in energy innovation, I think ARPA-E is off to a good start.
Clean energy and innovation are two areas that I’m passionate about, so I've been looking forward to investigating some interesting new energy technologies at the ARPA-E Energy Innovation Summit this week. The approach this agency is taking toward energy R&D is an important one, but is just one component to ensuring affordable, clean energy becomes a reality. At the summit, scientific and government leaders are coming together to talk about how to jumpstart this process. As part of these discussions, earlier today I participated in a “fireside chat” with U.S. Energy Secretary Steven Chu. Conversations like these are why events like the ARPA-E summit are so important.
ARPA-E is a new federal agency—the Advanced Research Projects Agency-Energy—created in 2009 to fund research of promising, but unproven, energy technologies. It was modeled after DARPA—the Defense Advanced Research Projects Agency—which was established in the late 1950s to accelerate development of U.S. satellite technology to keep pace with the Soviet Union. Research at DARPA led to a number of fantastic breakthroughs, including GPS technology and the Internet.
The idea behind ARPA-E is to help the U.S. fast-track development of innovative energy technologies that wouldn’t typically be funded by traditional energy companies. If just a fraction of the projects are successful, they could reduce greenhouse gas emissions contributing to climate change, help the U.S. decrease its dependence on foreign oil, , and keep the U.S. competitive in advanced energy technologies.
Creating inexpensive, sustainable, clean energy is also the key to lifting hundreds of millions of people from extreme poverty. We take things like electricity, transportation, and modern agriculture for granted, but there are a lot of people who still don’t have these basics because they can’t afford, or lack access, to energy.
I’ve been quite impressed with the people running ARPA-E. In less than three years, they have evaluated hundreds of proposals and made $521 million in grants to support 180 projects. Researchers are investigating new ways to develop, deliver, and store energy, improve energy efficiency, and capture CO2 that’s produced when hydrocarbons are burned.
One of the great things about ARPA-E grants is that they aren’t just going to a few well-connected researchers. Grant recipients include university scientists and engineers, younger researchers, entrepreneurs, small businesses, large businesses, non-profits, and national labs.
One of the initial proposals to receive funding was a large-scale battery project—conceived by MIT Professor Donald Sadoway—to store energy produced from renewable sources such as wind and solar. Given the intermittency of renewables, storage is critical to make them a truly viable part of the electrical grid. Sadoway’s “liquid metal” battery is made of relatively inexpensive, domestically-available materials.
Although the ARPA-E grants aren’t huge, they’re an important step in the right direction. They provide critical seed money to pursue ideas that may, or may not, lead to great breakthroughs. When the government decides to invest—even a relatively small amount—companies get greater visibility and private investors are more confident about jumping in to help move projects from the bench to the marketplace. A few months ago, ARPA-E announced that 11 projects have already secured more than $200 million in private capital investment.
I’ve personally invested in Sadoway’s project and a number of other promising energy startups, including several being shepherded along by Vinod Khosla’s venture capital company. They include Soraa, which is working on low-cost LED light bulbs, EcoMotors International, which is developing a high-efficiency diesel engine, and KiOR, which is developing a process to convert wood and agricultural waste into a high-quality, renewable substitute for conventional crude oil.
I’m excited about a lot of the research, but we really need to keep pushing on energy innovation. Some of the technologies won’t pan out. Others will, but scaling them to replace our dwindling supply of oil and meet the needs of a world population that’s projected to grow by nearly 30 percent over the next 40 years is a huge challenge. I’m an optimist that innovation can get us there, but adequate federal funding for energy R&D is essential. In my view, the amount that ARPA-E and other federal agencies are spending on energy R&D is far smaller than it should be, but at least ARPA-E was created quickly and has been executed quite well.