CXO

Bill Gates: 'We need energy miracles' yet US invests paltry 2% of R&D budget in energy

The demand for clean energy innovation is rising, but R&D hasn't grown to meet the challenge. Bill Gates recently called for a massive increase in energy research. Here's why.

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On 140 acres of unused land on Nellis Air Force Base, Nevada, there are 70,000 solar panels.
Image: US Air Force/Wikimedia Commons

The demand for energy — be it solar, wind, clean coal, nuclear, or hydro — already far outpaces the amount we spend on technological innovations for the future of energy, and that demand is only continuing to grow more rapidly. The International Energy Outlook recently projected world energy consumption will increase by more than 50% by 2040.

Last week, Bill Gates wrote a post about needing "energy miracles." He drew attention to some eye-opening statistics:

  • 60% of the federal government's R&D spending is on defense. About 25% is on health. Energy spending? 2%.
  • The US ranks 11th in overall percentage of the GDP that goes to energy research (Finland and China are the top two, respectively)
  • R&D spending on energy isn't just a government problem. It's also a serious problem in the private sector. The energy industry invests less than half of one percent (0.42%) of its revenue on research. In contrast, the pharmaceutical industry puts 20.5% of sales into R&D, and aerospace and defense spends 11.5%.

The US needs breakthroughs in clean energy in order to keep its economic engine running at full speed and to control future carbon emissions. So why does the federal government spend so little on research and development for innovations in this sector?

"People just have to understand that you don't invest today and get a clean coal plant tomorrow, or cheap batteries at scale tomorrow," said Margot Anderson, the executive director of the Energy Project at the Bipartisan Policy Center. "They take a lot of time, a lot of really smart people, a lot of money and private partnerships that develop."

Anderson is also part the American Energy Innovation Council, a research project by the Bipartisan Policy Center. The council focuses on research for the nation's energy future. The point is to raise awareness and advocacy, reform the way the US Department of Energy conducts research, advocate for a more robust energy plan, and support more funding for R&D.

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Image: gatesnotes.com

"There's a legitimate role for R&D. It is important for our long-term future and we can retain leadership whether it's for here or for export — [you have to] keep the prices stable," she said. "It doesn't come by itself, it comes with a lot of innovation and some is the responsibility of federal government."

The government's defense budget is an interesting comparison in the studies, Anderson noted, because people want a sound and secure country. And that also means a sound, secure energy system, she said. We use it every second of every day, and our energy usage is a major part of what we spend each month.

But, she reiterated, we have to be patient and bear in mind there are always failures, just like any other research. These are huge science experiments, with people working on every level — from studying the molecules and atoms with physics to the scale and distribution of the products or services after they are developed. The funding would progress basic energy sciences, long-term research in the industry, and renewable energy and efficiency initiatives.

In his piece, Gates noted that the council is arguing the federal government should triple its research from $5 billion a year to to $16 billion. That would make it 6% of the total R&D budget, he said.

This would lead to investments in research grants, STEM programs, funding for national laboratories and public/private partnerships, and pilot projects in various industries such as auto. Of course, there are already big investments being made (particularly by private companies) that are making solar panels, wind power, and electric and hydrogen vehicles cheaper.

The problem is, as Gates pointed out, the time lag between idea and implementation in the energy industry is very long. It takes years to develop the technology and get the policies in place to utilize it. Because the turnover is so long, there always needs to be new technology advances on the horizon, new experiments to try.

Another issue is assuming we already have all the technology we need and therefore are only waiting for the political policies and regulations to be put in place, said Robert Atkinson, president of the Information Technology and Innovation Foundation, a think tank that focuses on innovation and digital economy.

"What Gates — and ITIF — have argued is that we don't have the technologies we need to get clean energy widely adopted around the world," Atkinson said. "The most important thing individuals and businesses could do is not to recycle their garbage or buy a slightly smaller car, but encourage the federal government to develop and fund a robust clean energy science and technology agenda."

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Image: gatesnotes.com

People are still reluctant to invest in clean energy, because it costs more. Driving down the costs of clean, renewable energy is the key to addressing climate change, Atkinson added. And that requires more innovation.

With very little funding, the researchers who could be progressing the clean energy movement forward are not the only ones losing out. The US is also losing its value as a global leader for innovation, especially when countries like China and Japan are investing much more heavily.

We should see it as an integral part of America's values, Anderson said. Research and development should be "like apple pie."

"There is a whole universe of energy innovation, which can lead to specific technological breakthroughs that are required for us to maintain economic growth and a competitive edge," she said.

If you visit the White House petition website, there is only one petition to be found that addresses energy — and it's to allow Tesla to sell cars in all 50 states. So this is a citizen awareness problem as well.

If you'd like learn more about this topic and help inspire US lawmakers to take action, visit the White House site to start a petition, visit the Department of Energy's site to learn more about spending, look at progress made by the the American Energy Innovation Council, or even start innovating yourself with a crowdfunding campaign for accessible, renewable energy — like Mosaic, Divvy, or Solar Roadways.

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About

Lyndsey Gilpin is a former Staff Writer for TechRepublic, covering sustainability and entrepreneurship. She's co-author of the book Follow the Geeks.

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