ARPA-E funding at risk in H.R. 1

As I noted in a previous blog (in conjunction with just about all of my colleagues), the Continuing Resolution currently being debated in the House means deep cuts for a disturbing amount of energy and environmental programs.  One especially problematic aspect of the bill is that DOE’s new Advanced Research Projects Agency–Energy (ARPA-E) is provided $50 million, after receiving nearly $400 million via the Stimulus Act, and a proposed $550 million in the President's FY 12 budget. Such a minimal investment would hobble an exciting program just as its beginning to take off.  (this section UPDATED - see below for details)

Keep in mind that ARPA-E enjoy strong bi-partisan support.  Sen. Lamar Alexander, Sen. Lisa Murkowski and former Gov. Schwarzenegger will all speak at this year's ARPA-E summit, and an amendment this week during House C.R. debate to reduce ARPA-E funding to zero was opposed by over 100 Republican House members.  Business community leaders from Jeff Immelt to John Doerr and Bill Gates have spoken in support of ARPA-E. 

To give some background, ARPA-E builds off the beloved (at least among innovation wonks) and highly successful DARPA, the R&D skunkworks-style technology lab at Department of Defense.  ARPA-E was launched to acheive similar results in the clean energy space, designed as a nimble research entity sponsoring transformational clean energy R&D currently screened out by risk-averse institutes and labs. Theoretically, it will bridge the gap between basic research (especially at universities) and industrial development, while possessing greater independence and isolation from pressure to deliver short-term results.  In a nutshell, this program funds specific high-risk and high-payoff game –changing research and development projects to meet the nation’s long-term energy challenges.

By any measure, DOE’s ARPA-E program has been an early success.  The program has received bipartisan praise for quickly staffing up, and allocating funding rapidly and in a transparent fashion, while pursing innovative approaches not always seen in a government entity.  Since its launch, ARPA-E has focused on two different types of funding opportunities: near commercial existing technologies; and next generation technologies that could provide a transformational leap over current approaches, collected under a series of sweet acronymns (BEETIT, GRIDS, IMPACT, ADEPT).  This has led to a total of 37 grants totaling $151 million that mostly went to small businesses and educational institutions.  The list of projects is lengthy, but includes:  

  • A solar startup developing a new way to make silicon wafers for 80% less than the current cost.
  • A wind turbine manufacturer developing new wind turbines inspired by airplane jet engines.
  • A start-up developing a technology that combines sunlight and water to provide affordable, highly distributed solar energy
  • A storage company developing fuel-free compressed air energy storage technology.

In February, 2011, ARPA-E announced that six companies receiving ARPA-E funding (including the four mentioned above) have subsequently attracted $108 million in private venture capital investment, about four private dollars for every dollar that the taxpayers spent, and real-world evidence of the success of ARPA-E’s early investments.  . 

We aggressively support efforts to dramatically and strategically boost clean energy innovation in our country and consider ARPA-E an important piece of that strategy.  Reducing its funding would eliminate a critical component in our innovation infrastructure, which is already underfunded in historical terms, stifle our efforts to develop next generation technologies in America that can lead us into the global clean energy economy, eliminate current (and especially future) jobs, and ultimately weaken our efforts to improve our national energy security. 

UPDATE (2/23): a colleague pointed out that because ARPA-E didn't receive FY 10 funding, the $50 million in funding from H.R.1 doesn't represent a "cut" per se, but rather an extremely low funding amount that would essentially halt ARPA-E from doing the investments it was designed for and authorized by Congress to pursue.