Trump Takes Aim at Energy R&D Funds

Exclusive: While boasting of his plans for “American energy dominance,” President Trump is slashing key research projects and ceding much of the renewable energy market to China, notes Jonathan Marshall.

By Jonathan Marshall

In case you didn’t get the memo, the White House dubbed this “Energy Week.” Though devoid of substance, President Trump took the opportunity to tout his administration’s commitment not just to energy security — how passé — but to “a golden age of American energy dominance.”

A wind-powered turbine.

Apparently the White House budget office didn’t get the memo, either, because it still wants crippling cuts to very Department of Energy programs that help Americans get more bang for their energy bucks and fund breakthrough technology research to sustain U.S. energy leadership for decades to come.

The Trump administration proposes about $3 billion in cuts to basic and applied research on energy. It would slash over half the funding for the Office of Energy Efficiency and Renewable Energy (EERE) and wipe out altogether the much-acclaimed Advanced Research Projects Agency-Energy (ARPA-E). Those priorities are reflected in legislation now being crafted by the House Energy and Water Appropriations Subcommittee.

EERE works with industry and federal laboratories to promote cutting-edge, marketable technology related to energy efficiency; solar, wind, bioenergy and geothermal energy production; and advanced manufacturing programs.

To date, according to the office’s website, now under the supervision of Energy Secretary Rick Perry, “third-party evaluations have assessed one-third of EERE’s research and development portfolio and found that an EERE taxpayer investment of $12 billion has already yielded an estimated net economic benefit to the United States of more than $230 billion, with an overall annual return on investment of more than 20%.”

To promote visionary technologies that EERE and the private sector find too risky to fund, Congress authorized the creation of ARPA-E in 2007. It was modeled after the Defense Advanced Research Projects Agency (DARPA), which is widely credited — among other breakthroughs — with funding the creation of the Internet and the Global Positioning System.

A Nimble Agency

ARPA-E’s mission is to “enhance the economic and energy security of the United States” by reducing energy imports and pollution, improving the energy efficiency of the U.S. economy, and “ensur(ing) that the United States maintains a technological lead in developing and deploying advanced energy technologies.”

Solar panels.

Since ARPA-E first received funding in 2009, it has selectively supported some 580 R&D projects, representing a mere five percent of funding requests. Of those, 74 projects have gone on to attract more than $1.8 billion in private funding to pursue pilot projects, 68 have partnered with the Defense Department or other government agencies to further develop their technology, and 56 have spawned new companies to commercialize their concepts.

It has also earned an enviable reputation for brilliant leadership and for a nimble, efficient operational style usually associated with successful tech companies, not government bureaucracies.

Just in time to inform the debate in Washington, the National Academies of Sciences, Engineering and Medicine two weeks ago issued an authoritative assessment of ARPA-E’s track record and mission.

Contrary to the claims of critics, the report concluded, “The agency is not failing and is not in need of reform. In fact, attempts to reform the agency — such as applying pressure for ARPA-E to show short-term success rather than focusing on its long-term mission and goals — would pose a significant risk of harming its efforts and chances.”

The report’s biggest criticism: ARPA-E fails to tell its powerful story often and clearly enough to the general public.

The Trump administration’s sabotage of such R&D programs comes at an especially critical time, when vital considerations of climate, national security, and economics all cry out for more, not less, attention to clean energy.

On the climate front, time is fast running out for a global response to the threat of disruptive warming. An international group of prominent climate scientists, writing in the journal Nature, have just warned that without substantial reductions in carbon emissions starting in 2020, the chances are low of limiting our planet’s temperature increase to a high but manageable 2 degrees Celsius.

On the national security front, the increasingly anarchic state of the Middle East, the shakiness of the Saudi monarchy, and saber-rattling by Sunni oil producing powers against Iran and Qatar, provide a convincing rationale for weaning the U.S. economy off fossil fuels as quickly as possible, so our industry and transportation sectors become less vulnerable to price shocks induced by war or political instability.

Bowing to China

And on the economic front, the Trump administration’s energy sector cuts would amount to unilateral industrial disarmament against rising foreign competitors like China.

President Donald Trump welcomes Chinese President Xi Jinping to a state dinner during their summit at Mar-a-Lago, Florida, on April 6, 2017. (Screen shot from whitehouse.gov)

Recalling the waves of technology innovation that propelled the U.S. economy in the Twentieth Century, MIT lecturer William Bonvillian recently argued in The American Interest that the next great sources of growth and innovation are renewable energy (wind and solar) and vehicle electrification.

“Although U.S. R&D played a key role in creating these sectors, it has lost implementation leadership,” he warned. China “now dominates world production of solar, boasting five of the world’s six largest solar companies, has the largest wind turbine company, and is on track to generate a quarter of its electricity from wind by 2030.

“China did not enter wind and solar for the environmental benefits; rather, it saw them as rapidly growing advanced-technology sectors where it could dominate and capture major world export markets. It now has. While the U.S. economy maintains the overall lead in technological advances through its still-strong research in these areas, it is in the process of ceding the financial gains of production.”

With 10 electric car companies ramping up production, China also threatens the U.S. lead in such vehicles. But Bonvillian cited ARPA-E’s support of radical new battery technology as a potential key to creating a true mass market for clean electric vehicles while keeping the lead in the United States:

“If the next big [energy technology wave] is electric vehicles, ARPA-E is arguably a critical breakthrough innovation institution for achieving the battery advances this requires (as well as to other energy breakthroughs). Other agencies and the private sector aren’t anywhere near as well positioned.”

The good news is that Trump faces fierce opposition to his efforts to disband successful organizations like EERE and ARPA-E. Two years ago, a group of prominent business leaders, including Bill Gates and General Electric CEO Jeffrey Immelt, recommended tripling ARPA-E’s budget. ARPA-E also received strong support in June from the conservative U.S. Chamber of Commerce.

Just a couple of months ago, it received the most critical endorsement of all — when Congress upped its budget for the 2017 fiscal year by $15 million. Let’s hope that legislators continue putting our money where the jobs are and keep supporting America’s urgently needed development of clean energy.

Jonathan Marshall is a regular contributor to Consortiumnews.com.

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12 comments for “Trump Takes Aim at Energy R&D Funds

  1. July 1, 2017 at 12:32 pm

    Trump is Smart! Rather than shovel money to solar companies whose CEO’s fill their pockets and the pockets of their political friends (Democrats, remember Solyndra and about 25 more), President Trump has decided to let China and Japan research and develop more efficient solar cells, then purchase it from them at a much lower cost.
    The 100’s of $Millions that energy companies wanted to pocket just won’t happen under Trump. Sorry, guys, Obama’s gone and the party’s over. And maybe you should be investigated. I wonder how much of that money went to Hillary and the Elite Ruling Class.

    • Yuri
      July 1, 2017 at 4:33 pm

      I am in total agreement with JCL. Surprised at JM’s ideological ignorance. Government solar energy investment is another government boondoggle aimed at enriching Obama’s ideological friends. Let’s markets decide where the chips may fall. The tax payer’s money can be better spent on buying the most efficient and most competitive products without the wasteful research. Enough of US taxpayers funded research in health, energy and car industries (to name just a few) to ultimately ended subsidizing the Asian tigers’ (stealing foxes more like it!) industrial development, starting with the Japanese stealing our research and practically killing our automotive industry. The Chinese have been doing the similar stealing on massive scale. Making money on our ingenuity and federally funded research to then make money selling these products back to the world and us (and undercutting our industries) and then lending us money to print more money to subsidize the technical research here. Ripe for picking as always! And round and around it goes!

    • Zachary Smith
      July 1, 2017 at 10:58 pm

      The Trump administration is cheerleading for coal and nuclear power.

      Probably you didn’t even look at that first link – the source of this gem. Rick Perry is still a moron, and he works for an indifferent ignoramus. There is no cleverness anywhere in sight. If anybody needs any more evidence, here is another link.

      https://www.bloombergquint.com/politics/2017/06/29/trump-s-plans-for-a-nuclear-revival-will-begin-with-a-study

      First Sentence: (Bloomberg) — President Donald Trump has a plan to help the aging fleet of U.S. nuclear reactors estimated to be losing nearly $3 billion a year: study the issue.

      Yes, the two of them are real rocket scientists for sure. Those damned reactors (every one of them!) ought to be shut down as soon as possible, but the Trumpies are going to throw money at them and try to keep the dangerous antiques going – at a terrific cost, of course.

      A wild guess would be that the owners of those things are stalling – the cost of decommissioning the elderly nukes will be astronomical. Probably they haven’t figured out how to dump the cost of that on the rest of us – yet.

    • MarkP1950
      July 2, 2017 at 1:37 am

      Hundreds of millions. What about Trumps $7.5 billion Kemper “clean coal” FRAUD 15 times worse than Solyndra. Meanwhile China will pocket Trillions.

      • DFC
        July 2, 2017 at 9:14 pm

        Right, there is no way that clean coal has a prayer economically and technologically. My guess is it is a conservative PR dodge to claim being devoted to “green technology”. But it is bogus on the other side as well. Warren Buffet on wind farms: “I will do anything that is basically covered by the law to reduce Berkshire’s tax rate,” Buffet told an audience in Omaha, Nebraska recently. “For example, on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.” Solar is the same:

        http://www.zerohedge.com/news/2017-05-11/why-teslas-solar-roof-just-another-giant-taxpayer-gift-elon-musk

        In Europe also: Danish tax break phase out:

        Nobody was hurt more than Tesla: the company, whose sales were skyrocketing at the time, lobbied against the move, with CEO Musk warning during a visit to Copenhagen that sales would be hit. It wasn’t clear if the warning was targeting the government, the people of Denmark, or his own bank account and shareholders, but he was absolutely correct: in 2015 Tesla sold a total of 2,738 cars in Denmark. In 2016 the number dropped by 94% to just 176 units.

        http://www.zerohedge.com/news/2017-06-11/its-confirmed-without-government-subsidies-tesla-sales-implode

    • DFC
      July 2, 2017 at 4:15 pm

      Well, the American solar industry has asked Trump to intervene and put a tariff on Chinese solar exports. This will preserve solar manufacturing jobs in America, but ironically will seriously hurt the “solarization” of the American economy by making it less cost efficient. The irony goes even further, because most of the solar jobs in America are involved with installation and service of Chinese produced solar technology, not manufacturing. The irony continues as much of the solar installations are subsidized by the government through tax credits, anyway.

      http://www.zerohedge.com/news/2017-06-13/first-sign-us-chinese-solar-war

      So, in about 6 months we may see the Trump administration put a protective tariff against Chinese solar manufacturers claiming to be acting in a “green friendly” way. However, as I showed above, it will actually KILL the progress America has made in the green economy by making solar too expensive. No doubt he will also strike down solar tax credits and subsidies when given the chance. (True situation => Solar in America is dependent on Chinese production, government tax credits, loans and subsidies.

      Anyway, as an aside, I don’t see how the United States will be a world leader in solar technology with China producing all the capacity. (sort of like saying Israel will be a leader in petroleum because it has more filling stations) I suppose we are smarter over here and the Chinese are dumb, so they will just allow us to lead? Sorry to be cynical, but this his all sounds like the wave of hi-tech jobs that were supposed to arrive in the rust belt after NAFTA made it more cost productive to produce things in Mexico.

  2. Bob Van Noy
    July 1, 2017 at 1:13 pm

    Thank you Jonathan Marshall, very timely article and you’re exactly right about this being the wrong time for America to scale down solar energy. In fact now is the time to accelerate all aspects of our society from education to electrical technology to establish a solid global position in research and development. I appears that so called green energy has just now changed the formula on fossil fuels. I understand that there were some recent billing periods during peak usage in California, when the fossil fuel establishment was forced to discount their product to remain competitive. That seems hopeful to me.
    Tesla is building a world class battery facility in Northern Nevada that is expected to employ up to 6000 persons…

    • Bob Van Noy
      July 2, 2017 at 1:53 pm

      I have now red the links that Jonathan Marshall has provided and encourage all intetested in this subject to follow the link in the paragraph here…”Recalling the waves of technology innovation that propelled the U.S. economy in the Twentieth Century, MIT lecturer William Bonvillian recently argued in The American Interest that the next great sources of growth and innovation are renewable energy (wind and solar) and vehicle electrification.”

      Many thanks Jonathan Marshall and Robert Parry for this presentation…

      • Bob Van Noy
        July 2, 2017 at 2:05 pm

        Sorry, read!!!

  3. Zero
    July 1, 2017 at 6:03 pm

    Unfortunately there is an imbalance in the financial beneficiaries of government research. I believe that until a more comprehensive equitable way of distributing profits from tax payer funded research, the research should be halted. Electric car development absent an equal “home” development program is an imbalance and will only result in greatly higher electricity rates for homeowners. The government has no right to select winners and losers. Decentralize the profits by providing significant subsidies, not the low subsidies and incentives now in place, directly to homeowners to install energy efficient systems including solar and wind. Decentralized, not centralized benefits are the key and a proper pathway to balanced and more sustainable growth while at the same time closing the income and wealth gap exacerbated by centralized profit models.

    • Zachary Smith
      July 1, 2017 at 11:18 pm

      Decentralize the profits by providing significant subsidies, not the low subsidies and incentives now in place, directly to homeowners to install energy efficient systems including solar and wind.

      Brilliant idea – if the aim is to make everybody hate renewables. Itty bitty backyard windmills are fragile, noisy, and extremely ugly. If one of them needs to be repaired, do you figure the hardy homeowner will climb the mast to take a stab at it? Ditto for the roof-top photovoltaics. My roof is both steep and slippery. I’d be forced to pay somebody some big bucks anytime the upper parts needs attention. Ditto for the rest of the system in the garage – I’m no electrician and the batteries/electronic devices would be just as opaque for 95% of the population as for myself.

      Let the survivalists play with these things if they believe doing so is a good idea. The rest of us need gigawatts of safe electricity to replace the dangerous supplies we’re using now. And we need that power soon – assuming of course that we’re not already walking dead men.

  4. mike k
    July 1, 2017 at 6:20 pm

    The economic trolls are with us, trying so hard to justify Trump’s stupidity. The great deal maker seems only to know how to sell us all down the river.

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