• 15 hours U.S. Oil Production To Increase in November As Rig Count Falls
  • 17 hours Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 19 hours Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 20 hours EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 22 hours Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 23 hours Aramco Says No Plans To Shelve IPO
  • 3 days Trump Passes Iran Nuclear Deal Back to Congress
  • 4 days Texas Shutters More Coal-Fired Plants
  • 4 days Oil Trading Firm Expects Unprecedented U.S. Crude Exports
  • 4 days UK’s FCA Met With Aramco Prior To Proposing Listing Rule Change
  • 4 days Chevron Quits Australian Deepwater Oil Exploration
  • 4 days Europe Braces For End Of Iran Nuclear Deal
  • 4 days Renewable Energy Startup Powering Native American Protest Camp
  • 5 days Husky Energy Set To Restart Pipeline
  • 5 days Russia, Morocco Sign String Of Energy And Military Deals
  • 5 days Norway Looks To Cut Some Of Its Generous Tax Breaks For EVs
  • 5 days China Set To Continue Crude Oil Buying Spree, IEA Says
  • 5 days India Needs Help To Boost Oil Production
  • 5 days Shell Buys One Of Europe’s Largest EV Charging Networks
  • 5 days Oil Throwback: BP Is Bringing Back The Amoco Brand
  • 5 days Libyan Oil Output Covers 25% Of 2017 Budget Needs
  • 5 days District Judge Rules Dakota Access Can Continue Operating
  • 6 days Surprise Oil Inventory Build Shocks Markets
  • 6 days France’s Biggest Listed Bank To Stop Funding Shale, Oil Sands Projects
  • 6 days Syria’s Kurds Aim To Control Oil-Rich Areas
  • 6 days Chinese Teapots Create $5B JV To Compete With State Firms
  • 6 days Oil M&A Deals Set To Rise
  • 6 days South Sudan Tightens Oil Industry Security
  • 7 days Over 1 Million Bpd Remain Offline In Gulf Of Mexico
  • 7 days Turkmenistan To Spend $93-Billion On Oil And Gas Sector
  • 7 days Indian Hydrocarbon Projects Get $300 Billion Boost Over 10 Years
  • 7 days Record U.S. Crude Exports Squeeze North Sea Oil
  • 7 days Iraq Aims To Reopen Kirkuk-Turkey Oil Pipeline Bypassing Kurdistan
  • 7 days Supply Crunch To Lead To Oil Price Spike By 2020s, Expert Says
  • 7 days Saudi Arabia Ups November Oil Exports To 7-Million Bpd
  • 7 days Niger Delta State Looks To Break Free From Oil
  • 7 days Brazilian Conglomerate To Expand Into Renewables
  • 8 days Kurdish Independence Could Spark Civil War
  • 8 days Chevron, Total Waiting In The Wings As Shell Mulls Majnoon Exit
  • 8 days The Capital Of Coal Is Looking For Other Options
Alt Text

Is OPEC Considering Deeper Output Cuts?

You could argue OPEC and…

Alt Text

Oil Prices Rise Amid Falling U.S. Rig Count

Oil prices inched higher on…

Alt Text

The New Challenger To Lithium Batteries

The lithium-ion battery is head…

Breakthrough Institute

Breakthrough Institute

The Breakthrough Institute is a paradigm-shifting think tank committed to modernizing liberal thought for the 21st Century. Our core values are integrity, imagination and audacity.…

More Info

Industry Titans Call for Greater Government Investment in Energy Innovation

On Tuesday last week, the American Energy Innovation Council (AEIC)--composed of industry titans like Microsoft Chairman Bill Gates, Bank of America Chairman Chad Holliday, and leading venture capitalist John Doerr--released a follow-up to their 2010 report "A Business Plan for America's Energy Future." The new report, "Catalyzing American Ingenuity: The Role of Government in Energy Innovation," doubles down on the Council's earlier calls for increased and sustained public investment in clean energy technology, and offers new ideas about how greater energy innovation investment can be paid for in a new era of fiscal austerity.

In the wake of the high-profile bankruptcy of California solar company Solyndra, government critics are attacking federal investment in clean energy innovation, arguing that such decisions should be left to the "free market." But in their new report, these business leaders and entrepreneurs argue that government investment in energy innovation is key to realizing a clean energy future.

In addition to Gates, Holliday, and Doerr, the AEIC boasts membership from former Lockheed Martin CEO Norm Augustine, Xerox CEO Ursula Burns of Xerox, General Electric CEO Jeff Immelt, and Tim Solso, CEO of Cummins Inc. In the report, these executives highlight the tremendous impact that federal investment has had on technological innovation and economic growth throughout American history:

The federal government has played a central role in catalyzing and driving innovation and technology deployment throughout the history of the United States--often with strong results. This kind of support took a variety of forms. In the 19th century government scientists mapped out natural resource endowments and Army officers surveyed routes for railroads, including helping to plan and sometimes manage their construction. In the early and mid-20th century, programs such as rural electrification and massive public works projects, such as the construction of the Interstate Highway System, enhanced mobility and connectivity and directly or indirectly contributed to the development of new technologies and industries

...government efforts to develop guidance systems for the military played a role in the development of digital computers and microchips. Navy support for aviation technology led directly to Boeing's 707 -- one of the first major commercial jetliners. The Defense Advanced Research Projects Agency (DARPA) created a distributed network of computers called ARPANET, which laid the early foundation for the internet. The U.S. government played a direct and indispensable role in launching the commercial nuclear power industry.

Indeed, as the Breakthrough Institute has documented in "Where Good Technologies Come From," the federal government has made key investments in most of the technologies we take for granted, including the personal computer, the Internet, the jet engine, GPS, cell phones, the biotechnology industry, and countless blockbuster pharmaceutical advances. Today, as the AEIC report makes clear, such investment is urgently needed to catalyze breakthrough innovation in clean energy technologies in order to make them cheaper, more reliable, and therefore more widely adopted around the world.

Critics tend to ignore this history, claiming that innovation is solely the domain of the private sector. Following Solyndra's bankruptcy, these critics have insisted that "the government should not play venture capitalist." AEIC member John Doerr, perhaps the nation's most well known venture capitalist, sees things differently. Doerr writes, "America must embrace risks in innovation and invest heavily in R&D to create a full pipeline of good ideas." Echoing what we wrote after Solynda closed its doors, the report recommends that federal energy innovation investment "focus more on overall program success than on individual project success and emphasize the value in calculated risks."

In addition to issuing a robust defense of federal investment in energy innovation, the AEIC report also presents smart suggestions for strengthening some energy technology programs and reforming others. They support the federal energy loan guarantee program (which is under increasing scrutiny after Solyndra's bankruptcy), and call for boosting the budget of ARPA-E, the government's innovative, high-risk energy research agency, to $1 billion annually from around $200 million today. They also support a new Clean Energy Deployment Administration to aid the commercialization of first-of-their-kind innovations and mobilize significant private-sector capital in scaling up advanced energy technologies.

The Council also urges reform of the inefficient process by which the government conducts national energy policy, warning that "uncertain annual appropriations, short-term tax credits, and one-time spending injections are all unsuited to creating the sustained, predictable funding stream needed to bolster the country's innovative infrastructure." Moreover, as Breakthrough wrote recently in the National Journal, many of the federal programs supporting clean energy industries are set to expire in the next few years, which will likely precipitate a crash in the industry.

In order to avoid the perpetual boom-bust cycle in clean energy, the US government must increase the kinds of energy innovation investments outlined in the AEIC report. These investments must be rationalized around driving innovation and cost declines to make clean energy cost-competitive without subsidy.

Given the tight fiscal environment, the Council recommends a number of revenue streams that could fund innovation investment without adding to the budget deficit, including revenues from domestic oil and gas production, redirecting existing energy subsidies for mature industries, or small fees on electricity usage.

Ultimately, however, these leading business executives make a forceful case that America's current "budget dilemma," as they call it, is no reason to delay in boosting funding for energy innovation. "Supporting innovation," they write, "is an investment, not a cost." Indeed, given the country's economic malaise, there is no better time to make growth-enhancing investments that could catalyze a new era of American economic leadership in a key global industry. Critics of government investment in energy innovation would do well to listen to these titans of industry, and to heed their recommendations.

To read the full AEIC report, click here (PDF).

By Alex Trembath and Devon Swezey.

This article was published with permission from The Breakthrough Institute

Back to homepage

Leave a comment
  • Anonymous on September 20 2011 said:
    As we all know, we’re in a rising commodity price cycle. It started with oil, moved to precious metals and is now at the cusp of a major new price trend in agriculture. The weather’s been hard on crops this year and demand for cash crops is rising along with incomes in developing countries. Add in cheap money, a weaker U.S. dollar and a finite amount of productive land and it’s pretty easy to see that the agricultural economy is about to experience another boom.http://investmentguidance.us/

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News