OPINION

You know how Trump should celebrate Energy Week? Stop trying to cut innovation research

The president's proposed Energy Department cuts may be more damaging to the fight against climate change than pulling out of the Paris accord.

Ted Nordhaus
Opinion contributor
Wind turbines in Texas.

The Trump administration is celebrating its energy policies in a self-designated "Energy Week" that culminates Thursday with a presidential speech and participation in an “American Energy Dominance Panel.” But President Trump’s proposed budget cuts to energy innovation programs are no reason to celebrate. In fact, they could prove far more damaging to the fight against climate change than his decision to pull out of the Paris climate agreement.

The availability of cheap, low carbon technology, not treaties or regulations, will over the long term have far greater impact on how much progress the world makes to reduce greenhouse gas emissions. That proposed budget could be the most alarming administration step so far to derail efforts to reduce emissions and slow climate change. Not only would innovation programs be cut across the board by $3.1 billion (18%), popular programs such as the Advanced Technology Vehicles Manufacturing Program and Advanced Research Projects Agency-Energy would be axed entirely. 

Energy Department innovation programs have not been without controversy. Failed loan guarantees for Solyndra and Fisker famously sparked partisan outrage during President Obama's first term, despite the fact that the department’s portfolio of loan guarantees performed well overall. Environmentalists and conservatives alike have long lampooned the department’s synthetic fuels and oil shales programs from the 1970s and 1980s, which failed to deliver cheap transportation fuels at great cost to taxpayers. And the Clinton administration and congressional Democrats famously killed off the Experimental Breeder Reactor program at the Argonne National Laboratory in Idaho in 1994, setting back efforts to develop advanced nuclear reactors in America by decades. 

But energy innovation investments by the department and its predecessors have also brought enormous economic, energy security and environmental benefits to the United States. Nuclear energy, commercialized by the old Atomic Energy Commission for less than $10 billion in today's dollars, supplies almost 20% of the nation’s electricity with clean, carbon free power. Widely publicized investments in hydraulic fracturing and less well known investments in developing efficient combined cycle natural gas turbines have together allowed natural gas to displace coal as the largest source of electric power in America, most of the reason why the United States has led the world in emissions reductions over the past decade. 

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The shale revolution has transformed America from the world’s largest energy importer to its largest energy exporter, putting an additional $100 billion annually into the pockets of U.S. consumers thanks to lower energy prices and leading many manufacturing firms to relocate to the USA to take advantage of lower priced energy inputs,

The list of energy technologies that the department can claim at least some credit for doesn’t end there. Wind and solar energy were both commercialized through the Energy Research and Development Administration, which became part of the department in 1977. Important technological advances from the Clinton-era Partnership for a New Generation of Vehicles paved the way for today’s electric cars. The Energy Department and the National Laboratories also played critical roles in developing transformative energy efficiency technologies such as LED lighting, high-definition video screenshigh-efficiency refrigerators and other appliances. 

In short, pretty much every source of clean energy available in the USA today traces its provenance back to the Energy Department in one way or another. That shouldn’t absolve it of its failures. As a general rule, investments have succeeded when they have focused on demonstrating new technological capabilities, such as those in early nuclear reactors and in wind and solar. By contrast, when the department has attempted to set production targets and more pro-actively manage technological development, it has been far less successful, as was the case with oil shales and synthetic fuels. 

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Federal investments in energy innovation have also worked best when there was private skin already in the game. Competitive grant processes, requiring that private investors share in the cost of developing better energy technologies, help ensure that promising technologies are vetted for their economic viability by market actors before federal investment starts to flow. The National Laboratories, meanwhile, have had great success when they have worked closely with industry to solve key technological challenges. Federal scientists worked side by side with petroleum engineers at companies such as Mitchell Energy to figure out how to map shale formations, apply horizontal drilling techniques, and develop cost-effective fracking fluids. Close collaboration with turbine manufacturers helped bring today’s super-efficient combined cycle gas turbines to market. 

Warts and all, federal investments in clean energy technology over the past six decades have paid off for the nation’s consumers, health and energy security. That is why key Republicans have criticized the administration's proposed cuts. Even for those skeptical that climate change is caused by humans and bullish that today’s era of cheap fossil energy will continue for many decades to come, these sorts of investments represent cheap insurance to protect our planet. 

Ted Nordhaus is co-founder and executive director of the Breakthrough Institute. Follow him on Twitter: @TedNordhaus

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