Friday, May 21, 2010

Energy Revolution at U.S. Doorstep

By Andrzej Zwaniecki [Staff Writer]

Washington - The United States is planning to take advantage of breakthrough technologies, waking up to the potential of clean energy development, according to analysts.

By taking swift action on energy-related challenges, the nation can seize an opportunity to lead an industrial revolution and harvest related security, economic and environmental gains, said Arun Majumdar, the head of the Advanced Research Project Agency-Energy. Majumdar, who was one of the speakers at a May 13 event at the Center for Strategic and International Studies in Washington, cited securing energy supplies, reducing greenhouse gas emissions and accelerating technological progress as main challenges.

The agency, created by Congress in 2007, was formally launched by President Obama in 2009 to fund research projects that hold the potential to transform ways energy is generated, stored and used. It has awarded $150 million for 37 projects.

Majumdar said the U.S. economy has many strengths, including the world's best research and development infrastructure, the highest concentration of venture capital and a culture of entrepreneurship. However, he said, so far the United States has failed to tap the full potential of its innovation system, falling behind other countries in building up its clean energy sector.

In 2009, China replaced the United States as the global leader in overall clean energy investment and is projected to overtake the United States soon in renewable energy generating capacity, according to a 2010 report by the Pew Charitable Foundation. As a proportion of gross domestic product, 10 nations including Spain, Brazil and the United Kingdom outstrip the United States in clean energy investment, despite the fact that some of the technologies that they are investing in, such as solar photovoltaic cells and lithium-ion batteries, were developed by Americans.

Majumdar said addressing energy-related challenges requires a gigantic endeavor similar to the one undertaken to launch the information technology revolution. He said his agency alone will not be able to carry out such an effort.

"We need to build a large community ... for our nation to change course with fierce urgency," Majumdar said.

The private sector needs to adopt successful technologies and increase the volume of related products and services, he said.

Other observers said the government has to play a bigger role than it did in the information technology revolution.

That's because innovative energy technologies are encountering much stronger resistance from politically powerful, heavily subsidized industries than computers or the Internet did in the 1980s and 1990s respectively, said William Bonvillian, director of the Washington office of the Massachusetts Institute of Technology.

In 2009, the U.S. government provided more than $100 billion in funding for clean energy projects as part of an economic stimulus, in an effort to make the economy more innovative, energy efficient and secure.

Bonvillian said it was a good beginning, but added that the United States must have a coherent and consistent vision of its energy future, make related strategic decisions and provide appropriate funding to accelerate progress toward a more sustainable economy.

Environmental organizations and some business groups have been calling for a policy of taxing carbon dioxide emissions as a way to make clean energy technologies more competitive. But Bonvillian said such a policy alone, even if enacted, would not be sufficient to move successful new technologies from lab to market. Although the energy innovation system is evolving in the right direction, he said, mechanisms for transferring knowledge from universities and other research centers to the market are still inefficient. Thus, the government needs to step in and provide an additional push by leveraging its purchasing power and other capabilities, Bonvillian said.

Experts caution, however, against over-reliance on technologies to solve all energy problems. New technologies are decades away from affecting the economy, security and environment in a major way, and some existing ones are costly. Thus nontechnology solutions must be part of an overall U.S. energy strategy, Majumdar said. For example, he asked, why not use natural gas more widely as a transportation fuel as the United States' natural gas resources are abundant and natural gas is cleaner than petroleum?

An audio copy of Majumdar's remarks is available on the website of the Center for Strategic and International Studies and the Pew Charitable Trust's report (PDF, 2.8MB) is on its website. The text of a statement of Arun Majumdar (PDF, 865KB) before a House of Representatives committee can be accessed on the committee website.

(Published by the Bureau of International Information Programs, U.S. Department of State)