Press Release: Senate Energy Committee Holds Hearing on Business Leaders’ Plan for Greater Energy Innovation Investment
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[one_half]For Immediate Release
April 30, 2012[/one_half][one_half_last]
Contact: Paul Bledsoe
(202) 204-2400
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Senate Energy Committee Holds Hearing on Business
Leaders’ Plan for Greater Energy Innovation Investment
Norm Augustine, Bill Gates, 5 other Top Innovation Leaders Urge US Support for Research to Spark Key Industries and Create Energy Technology Breakthroughs
WASHINGTON, DC – The U.S. Senate Committee on Energy and Natural Resources today held a full committee hearing on a recent report by a group of America’s top business executives, including Bill Gates and Norm Augustine, who urge much greater government investment in energy technology research to produce long-term energy breakthroughs.
“America’s investment in energy innovation from the public and private sectors together is less than one-half of one percent of the nation’s energy bill. This fraction is eclipsed by the innovation investment in most other sectors, particularly those in the high-tech arena,” testified Augustine, former chairman and CEO of Lockheed Martin and Under Secretary of the U.S. Army. “Due to the risk entailed, private sector investment will often be unavailable …. In the case of basic research, market payoffs are usually well over a decade in the future, and may not exist at all. In the case of proving scalability, the size of the investment required is often large and the results uncertain. But in spite of these considerations, the development of new energy sources remains of critical importance to the nation…hence means of overcoming them must be found.”
“I, and I believe my colleagues, are strong devotees of free enterprise as opposed to government involvement in markets to the extent practicable, the energy dilemma seems to be exactly the sort of issue which governments are designed to help solve, at least in democracies with free enterprise markets. That is, this is a case wherein there is an important benefit to be had by the citizenry as a whole but private resources cannot, or will not, provide that benefit because of financial risk, extensive delays in receiving returns, small or even negative returns and the possibility that the returns will not even accrue to the investor or performer. The latter is particularly true in the pursuit of basic research.”
“This circumstance is one that has long been recognized by our government in a number of areas, including many involving the application of technology. Commercial nuclear power was the result of government investments in Naval reactors; commercial jet aircraft trace their origin to military transports; GPS to military positioning systems; the internet to packet-switched networks demonstrated by ARPA; and communication and weather satellites to military space programs. These achievements were in some cases by-products of the government’s pursing other missions in the interest of its citizens—but the provision of energy is itself a mission of the utmost importance to the citizenry.”
“Looking further back in time there was the creation of land-grant colleges, agricultural research institutes, the federal highway program, and the air traffic control system. The key point is that the government advanced the state of the art in these areas to a point at which the private sector could responsibly undertake implementation and operation of the capability sought by the citizenry.”
See Augustine’s full testimony here.
The American Energy Innovation Council released its second report in September detailing the case for government investment in research to produce long-term energy breakthroughs, arguing that even in times of budget austerity such investments are crucial to US economic competitiveness and to the development of clean, affordable, and secure supplies of energy. The report, Catalyzing American Ingenuity: The Role of Government in Energy Innovation, finds that while US government investment in technology research has been integral to American economic competitiveness in many sectors, needed investments in energy breakthroughs are simply not being made.
“We are in critical need of a government commitment to research into new energy technologies that can free us from our dependence on foreign oil and create affordable clean-energy alternatives,” Bill Gates said upon release of the study last fall. “Yet today, the U.S. government spends only one-sixth as much on energy innovation as it does on medical research.”
In addition to Gates, chairman and former CEO of Microsoft, and Augustine, AEIC members include: Ursula Burns, chairman and CEO of Xerox; John Doerr, partner at Kleiner Perkins Caufield & Byers; Chad Holliday, chairman of Bank of America and former chairman and CEO of DuPont; Jeff Immelt, chairman and CEO of GE; and Tim Solso, chairman and CEO of Cummins.
AEIC’s first study, released in June 2011, and other information on the Council can be found at www.americanenergyinnovation.org