ARPA-E Energy Innovation Summit 2013
One of the bright spots in US policy has been the Department of Energy’s (DOE) Advanced Research Projects Agency – Energy (ARPA-E) program, which has bipartisan support. Both Republicans and Democrats have come out speaking favorably about the potential of ARPA-E’s contribution to wean the country from its dependence on fossil fuels, and also address the greenhouse gas emissions that is at the heart of the climate change problem. Inspired by the Defense Advanced Research Projects Agency (DARPA) under the Department of Defense, ARPA-E is intended to spur game changing technologies, in the same way that DARPA played a pivotal role in innovations that led to the creation of the Internet.
It was gratifying to know that ARPA-E supported “non-sexy” technologies. The electricity grid can be roughly divided into three components, power generation, transmission and distribution (T&D), and end use. Of these three, T&D has received the least attention and therefore the least investment. While the public is more aware of the high profile renewable energy technologies and policies needed to lower our dependence on fossil fuels, less is talked about when it comes to the mundane innovations like the grid. Under ARPA-E, the GENI program specifically address how the grid can become “greener” and how to improve the uptake renewable generation.
To date, ARPA-E has disbursed nearly $300 million per year since 2009 and funded nearly 300 projects to universities, large companies, utilities, and start ups. At this year’s ARPA-E Energy Innovation Summit, almost all of the fundees participated in the exhibition. Among the exhibitors, a couple particularly stood out.
Using Silicon Carbide (SiC), Cree has developed power electronics that will have a major impact on the utility industry. SiC offers advantages over your typical silicon components, by increasing power efficiency from the 80%-tile to over 93%. Instead of bulky transformers that often weigh up to 10,000 pounds, they can be reduced to 100 pounds. This will not only make installations easier but also improve maintenance and enabled the grid to handle multiple types of power sources, including renewable energy generation that are intermittent in nature. Ultimately, these systems can used to support microgrid development in communities. Cree has already received over $5 million from ARPA-E and commercialized their technologies, including LED lamps that are currently available in hardware stores around the country.
The uptake of renewable energy into the world’s power grids will require investment in energy storage in order to mitigate the variability of energy produced from solar and wind. Batteries continue to be expensive and are limited to specific applications due to their smaller capacities.
Compress air energy storage (CAES) has been under development for many years to address the needs of grid storage. Another ARPA-E fundee, General Compress has developed a 2 MW system that can be ramped up in as little as 6 seconds, much faster than similar systems under development. In addition, the operation can be reversed from expansion to expansion in as little as one second.
ARPA-E sows the seeds of future success by providing funding at early stage development. At this years summit, one of the key questions is what is needed to take technologies to the next stage of private investment. Indeed, a policy environment, for example, that promises funding from DOE or other sources beyond ARPA-E is critically needed so that innovators will get into the process in the first place.
Elon Musk of Tesla Motors and recipient of a separate DOE loan program, has pointed out the enormous value of government programs like ARPA-E. Although not all projects will succeed like, for example the case of Solyndra, successes like Tesla can be game changing. He has pointed out that not only is the company able to turn a profit, but that it will be able to repay its loan ahead of time.
Another issue is the lack of energy expertise in the investment community. Attendees that I’ve talked to generally come from the IT field and are only stepping their toes into the energy field. There needs to be strong awareness that investing in energy is very different from IT and requires much more capital.
Better management to bring together different stakeholders is needed. ARPA-E was modeled on DARPA and in fact had intended to bring in DARPA to help build its capacity. At this year’s summit, DARPA officials had also come to discuss their future collaboration with ARPA-E and to bring capacity to the current management.