Wednesday, March 28, 2012

Oral Statement as Prepared for Delivery by Dr. Arun Majumdar, Director, Advanced Research Projects Agency-Energy (ARPA-E), U.S. Department of Energy before the Energy and Water Development, and Related Agencies Subcommittee, U.S. House Committee on Appropriations on the Fiscal Year 2013 Budget

ARPA-E: Catalyzing Energy Breakthroughs to Secure America’s Future

I would like to extend my thanks to the Chairman, the Ranking Member, and the esteemed members of the Subcommittee for inviting me here today to present the Department of Energy's Fiscal Year (FY) 2013 budget request for the Advanced Research Projects Agency-Energy (ARPA-E). As I have said before to many of you, I consider you all to be my Board of Directors. I am here to report to you what we have done in the past, and what we plan to do in the future.

ARPA-E is focused on research to create breakthroughs in energy technologies. Let me explain what I mean by using an example. Until the 1970s, we used punch cards to enter data into computers. In only 30 years, we went from punch cards to smart phones. Most of the innovations that allowed the information revolution - transistors, integrated circuits, wireless communication, and the internet - were created first in the U.S., and then used globally. We didn’t make better and better punch cards. We invented the future using technology innovations based on our strong foundations in science and engineering. The U.S. has been doing this all throughout the last century - from the Wright brothers and the airplane, Jonas Salk and the polio vaccine, to Nikola Tesla and Westinghouse creating the first AC electric grid. These and many other innovations by our parents and grandparents created a better and more secure life for all of us. ARPA-E’s goal is to catalyze similar innovations in the energy sector so that our children and grandchildren have a better future than we do.

ARPA-E’s statutory goal is to invest in research to rapidly translate science into breakthrough energy technologies that are too risky for the private sector, but ones that would ensure U.S. global competitiveness and security. ARPA-E does not fund incremental improvements in existing technologies, but rather quantum leaps in energy technologies. Let me give you a few examples of what I believe are early ARPA-E successes.

Last month, an ARPA-E awardee, Envia, announced the world record in energy density at 400 Wh/kg for a rechargeable lithium-ion battery, which is double that of today’s batteries. What does this mean? If we were to travel from Washington to New Jersey, it would cost about $40 for gasoline in a conventional car, whereas in an electric car the electricity cost would be about $6 – more than 6 times cheaper. But the challenge in electric cars is that the battery pack would cost about $30,000. Now Envia’s battery is not yet ready for primetime, but if we were to use the Envia battery today, it would cut the battery cost by half and they are trying to reduce the cost even further. ARPA-E’s goal is to reduce the cost of batteries so that electric cars can have comparable range and cost as gasoline-based cars so that they can be sold without subsidies, and reduce our dependence on imported petroleum. 

We all know that algae can produce oil, but those oil-producing algae don’t grow very fast. We have a team at Berkeley that is taking the set of genes that produce oil in algae, and inserting them in a plant like tobacco that grows fast on bad soil. If this works, you would then squeeze the leaves of tobacco and produce oil. I really hope their research is wildly successful because it could put our tobacco farmers back to work and reduce our dependence on imported petroleum by creating a renewable fuel – that is a win-win-win proposition. 

Our grid is an aging infrastructure. Here is an example. The average age of a transformer in the United States is 42 years, 2 years beyond their projected lifespan. A typical 1 Megawatt (MW) transformer in our distribution substation weighs 8,000 lbs and is manufactured by foreign companies. An ARPA-E awardee, Cree based in North Carolina, is creating a quantum leap in electrical power technology. They are developing a 1 MW transistor made of silicon carbide the size of your fingernail. If they are successful, the 1 MW transformer could then shrink from 8,000 lbs to 100 lbs with greatly reduced cost and increased reliability. Because the U.S. is the world’s leading manufacturer of silicon carbide, the Cree project could transform future electrical power technologies and create a large export market. 

These are only a few chapters of the ARPA-E story, and the ARPA-E story is the American story. These pioneers are the Wright brothers, Salks, Edisons, and Teslas of the 21st century. They will compete, and sometimes fail, but get back up and try again. The future prosperity and security of our nation depends on them. ARPA-E will continue to find these crown jewels of our nation and invest in them. Last month, we organized the third annual ARPA-E Energy Innovation Summit, which was attended by about 2,500 innovators, entrepreneurs, investors, federal and state agencies, members and staffers from Congress and the White House. We showcased 126 ARPA-E funded technologies, 29 technologies ARPA-E could not fund, as well 92 partners, sponsors, and other energy technology stakeholders. We need them to succeed as well. We had the pleasure of having Congressmen Womack and Fatah of this Subcommittee speak at the Summit. I hope you all get a chance to attend the Summit next year and meet the pioneers and innovators from your own districts.

Let me report on what we are doing with the FY12 appropriations:

Last year, I promised that we would focus on the use of natural gas in transportation. In February, we announced a new program to fund research on breakthroughs that would make it cheaper to own and operate a natural gas vehicle than a gasoline based one, and one you could refuel at home. 

I also promised that we would create a joint program with the Department on Defense to invent dual-use technologies that address our national security needs and also our civilian economy. We are in the process of issuing a new funding opportunity for improving the safety, reliability, and performance of energy storage systems. 

ARPA-E is unique for issuing an open funding opportunity to all our nation’s innovators to propose any new idea on energy. This openness is important because the innovators can integrate across traditional silos and create something new, ones that we could not imagine. 

ARPA-E projects involve risk that the private sector is unwilling to take. Because this is research, some may fail. Managing the risk on behalf of the taxpayers through active program management is part of ARPA-E’s DNA. We have discontinued several projects where the ideas simply did not work out – a promise that I made last year, and one that we have now carried out.

ARPA-E will continue to proactively seek out “white spaces” where it can fill a vital gap in early stage research in coordination with the Office of Science and Applied Energy Offices. In FY13, we plan to have an increased emphasis on transportation, but with adequate attention to our stationary power systems.

I thank you for the opportunity to testify before you today, and I look forward to answering your questions.