Addressing climate change through energy innovation may take an infrastructure revolution

Published on January 21, 2019 by Claudia Adrien


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Rick Perry

Federal officials will need to create an initiative as grand as the United States’ first moon landing to address energy needs in the era of climate change, and leaders remain optimistic it can be done with multiple stakeholders at the local and national levels in upcoming decades.

This was the overarching message from principals of the American Energy Innovation Council who spoke Thursday during ‘Energy Innovation: Fueling America’s Economic Engine,’ and hosted by the Bipartisan Policy Center.

“When President Kennedy said we’re going to the moon, we didn’t get there until 1969,” said Wanda M. Austin, Former CEO and President, The Aerospace Corporation. “We had a number of failures, but we didn’t stop.”

Not stopping means bolstering private sector and university partnerships, making striking changes in federal funding, and altering the pathways for advancing energy research and development, the speakers said.

As for university systems, there should exist a stable line of investment and partnerships because “you don’t get your best researchers and your brightest students to get connected to something they don’t think is going to last,” said Austin. She suggested that there should be longer-term financial support other than annual budget cycles.

“One of the things we need to invest in is how to move these great innovations into that transition pipeline to effectively deliver what we want, which is lower cost, cleaner, accessible, storable energy,” Austin added.

One such way of doing this would be to guarantee significant federal funding that was predictable over a 10-year period and that would encourage private sector matching funds, the speakers said.

However, establishing this pipeline may mean upending how things have typically been done in getting research to market. As an example, China is outspending the United States in research and development and in its state-owned enterprises.

“If you look at the goals they have in their five-year energy development plan, they have very tight and specific goals spread out over different technologies and they don’t have these distinctions between basic and applied technologies that we do,” said Jay Faison, founder and CEO of ClearPath, which aims to accelerate conservative clean energy solutions.

Faison noted that the United States has a bias toward basic research that sometimes gets caught in what’s called the ‘valley of death’ where commercialization hits a wall. On the other hand, China will buy such an enterprise out of bankruptcy and commercialize it.

The United States has not passed a large energy bill since the 2007 energy package, said Faison, and marching into huge legislation might not be realistic, despite calls for a “moon shot” approach.

He cited the FUTURE Act, a bill that extended and reformed a federal production tax credit to encourage technological innovation in carbon capture utilization and storage, as an example of productive bipartisan legislation. The legislation was included in the U.S. budget bill signed into law in February 2018.

Despite competition in international energy research, the speakers said they were still confident that the U.S. system for innovation could outpace other countries.

“Our labs are doing as cutting edge as you’ll find,” said Chad Holliday, chairman of Royal Dutch Shell. “And we at Shell have to decide whether we’ll put our major research in our labs in Houston or our labs in Amsterdam or our labs in India. We’re putting more and more in Houston because we think this system is better, but we could do so much more.”

Doing more means also solving energy storage problems.

“It’s clear to me that we could come out and say, ‘hey, no carbon by 2050, piece of cake.’ But that’s garbage, because we know in order to achieve those objectives, we do need an additional technology revolution,” said Thomas A. Fanning, chairman, president and CEO of Southern Company. “We need big ideas where we can get storage at scale…we need real material science advances to push that idea.”

Part of the energy revolution may result in a country moving toward a distributed infrastructure, which Fanning described as an “attack on a 100-year-old business model that many people feel very defensive about.”

Part of transitioning is a focus on cyber and physical security for grid assets, and Fanning announced that his company would incorporate concepts of resilience in an Integrated Resource Plan.

Transitioning out of an old model also means understanding how the United States creates an optimal energy portfolio that is regionally based.

Fanning suggested examining energy that is appropriate to each region. Wind may be important to other parts of the country but not as much for the South as solar power is.

Mike Graff, chairman and CEO at American Air Liquide Holdings, agreed. “It’s not one or the other, it’s both,” he said.

As for energy storage, “How do we store power at night? Or on a peak period on a cloudy day? Hydrogen can be a clear solution,” he added.

Graff announced that his company is to supply all the hydrogen needs for the new vehicular infrastructure being built on the West Coast, serving the needs of automotive manufacturers like Toyota and Honda to fuel their hydrogen fuel cell vehicles, which will have a zero-carbon footprint.

U.S. Secretary of Energy Rick Perry used the event to announce that the Department of Energy (DOE) is launching a new lithium ion battery recycling prize, including cash awards of up to $5.5 million over the next three years.

In addition, the DOE will provide $15 million for a lithium battery research and development recycling center focused on cost-effective recycling processes to recover lithium battery materials.

The center will be led by Argonne National Laboratory along with the National Renewable Energy Laboratory and Oak Ridge National Laboratory. The goal is to reclaim and recycle critical material aimed to reduce dependence on foreign sources of this material by encouraging entrepreneurs to capture up to 90 percent of America’s lithium-based battery technology. This would strengthen U.S. energy security, expand economic security, and bolster national security, Perry said.

“We can create the technologies we need to do everything that we’re going to require in this country from high-performance computing to making the air that we breathe cleaner,” he said.

“All of this activity puts the United States squarely on the side of innovation, which is exactly what Americans want.”