Energy Secretary Steven Chu Makes Major Funding Announcement

US Energy Secretary Steven Chu spoke to Council on Competitiveness' National Energy Summit. Here is a summary of his remarks.

Title: Revving up the American Innovation Machine

The US innovation machine is the greatest in the world -- lasers, solar cells, GPS, goes back to Henry Ford.

Trend: we're losing our manufacturing base. Global high-tech manufacturing is rising, but the US share is falling. This is disturbing.

How to respond to a challenge. In 1898, president of the Royal Society of Chemists challenged them to work to prevent a food crisis: infent artificial fertilizer. Ten years later, Haber and Bosch transformed food production by synthesizing ammonia. We are facing a crisis that big today.

What's that challenge? Climate change. The culprit is the greenhouse gases we put into the atmosphere.

United States has highest emissions per person. We need to reduce our emissions by 80% by the middle of the 21st century. What will developing countries do? Get to economic prosperity through high carbon emissions,just like we did. Or, they can follow a path of continued lowcarbon emissions.

Some in the developing world see call to reduce carbon emissions as call to keep them in poverty. Prosperity is not a zero-sum game. There is no law of physics that says that energy use = carbon emissions.

Energy use vs. human development index (health care, education, GDP): poor countries don't consume much energy, but as you grow in wealth, you plateau at how much energy you use.

Economic competitiveness in a clean energy economy: the price of oil will go up over time because recovery costs will increase. The developing world will increase its energy uses quickly. We will live in a carbon-constrained world. We have a choice: hope things change, or realize that we need a new industrial revolution. We should go to where the future will be, not where it's been, and we need policies that reflect that.

Tech revolutions are disruptive. The first response is often protecting what we have, but we have the opportunity to lead this new industrial revolution on clean energy.

We invented photovoltaic cells, but we let the technology go to other countries for implementation. Other technologies we're behind: lithium batteries, auto fuel efficiency, electricity transmission, power electronics, nuclear power. We have to rebuild the attitude and will to recapture this technology.

In the near term, government investment is critical, and we're putting a down payment on a clean energy economy. Recovery Act will double non-hydroelectric renewable energy generation. We're still on target for this. Many projects were only kept online -- or brought into the US -- thanks to the recovery act. Recovery Act has been moving fast -- using grants in lieu of tax credits. $ 1 billion toward renewable energy projects. We got projects out in 58 days instead of 18 months.

Example of a project: company in Ohio makes bolths. One wind turbine needs 1500 bolts -- 10 lbs each. That's manufacturing.

ANNOUNCEMENT: $43 million being awarded in Industrial Carbon Capture and Storage project out of the $1.4 billion given for such programs.

It's hard to develop technology long-term when there are uncertain and unstable incentives. Congress needs to take a long-term view. Example: Germany and Denmark have made these commitments and seen results. China is also taking this seriously and investing accordingly.

We need innovative energy efficiency programs for the consumer -- example: home energy solutions.

New program: retrofit ramp-up. Turning retrofits of homes into block parties. If one third of the block gets tested, it's more efficient. This program will simplify and reduce costs of home retrofits. Working with HUD to save on utility bills for federal public housing, energy efficient mortgages -- extant program; new effort will get more people into the application. Loan process: energy efficiency should be part of the federally-backed loans.

Aligning incentives to make efficiency affordable -- not a law, it's voluntary. 

Reduce peak electric load -- 95% of the time, some of our energy is standing idle. If we can shift the load over -- i.e. running your clothes dryer at night -- you shift the grid and we can save billions on capacity. Lowering peak loads saves money.

Invest in next generation of scientists and engineers. Stable, long-term incentives and investing in projects that are self-funded or cheap. Support innovative research models.

Science, Technology, Education: STEM. Dept of Energy supports STEM and bringing young people into science. Investing in students, teachers, national labs -- companies need to also invest so that these scientists are put to good use.

Utility companies lag -- utility R + D is among the lowest of any sector.

We want to invest in "Pasteur's Quadrant:" innovation that's breaking boundaries AND can change the way science is applied. ARPA-E and the Energy Hubs/Bell Lab0lets live in Pasteur's Quadrant.

New DOE programs: Energy frontier research centers, Bell Lab-lets. DOE has funded more Nobel laureates than anyone in the world.

Scientists have come to the service of our country in times of national need. At Los Alamos and MIT's Lincoln Labs, we put our ideas to work and made breakthroughs. These are the model for Bell Lablets and Innovation Hubs. Mix of people, so you solve fundamental science problems and then get technology to companies. Bell Labs had the best practicing scientists as managers, and that meant resource deployment happened quickly. DOE wants to emulate that strategy with Bell Lab-lets. This all creates an environment of active communication, connection, and discussion.

Humans have changed the destiny of the Earth through climate change. New industrial revolution, which we have the chance to lead, will create competitiveness.

Martin Luther King Jr: "In this unfolding conundrum of life and history, there is such a thing as being too late."

Question from Council on Competitiveness President Deborah Wince-Smith: how can we ensure that we capture this?

You want to take all this scientific knowledge and move it that much further. DOE is going through how to streamline the process and encourage people to realize that science and engineering are important. Exaggeration: the best way to be fair is not to collaborate with no one (old policy), but to collaborate with everyone and to be transparent about those collaborations.

Question from Rick Engel, Prudential Capital: deploying capital quickly is going to make a difference in energy efficiency efforts. 

We're taking a short break -- we'll be back with a panel on the transmission superhighway at 4 PM EST.

— Sarah Spooner

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