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Presidential Report calls for integrated Federal energy policy with Quadrennial Energy Review, $16B per year in Federal support for energy RDD&D
29 November 2010
|Overview of PCAST recommendations. Click to enlarge.|
The United States should craft a government-wide Federal energy policy and update it regularly with strategic Quadrennial Reviews similar to those produced regularly by the Department of Defense, according to a report on energy challenges released by the President’s Council of Advisors on Science and Technology (PCAST), a group of presidentially appointed experts from academia, non-governmental organizations, and industry.
The report, Accelerating the Pace of Change in Energy Technologies Through an Integrated Federal Energy Policy, provides a roadmap for the Federal role in transforming the US energy system within one to two decades. It calls for significant changes in the way the Federal government coordinates fulfilling the US energy needs across individual agencies and programs. It also calls for a substantial increase—to $16 billion per year—in Federal support for energy RDD&D (research, development, demonstration and deployment). To be effective, the report notes, this funding must be long-term, stable, and have broad enough bipartisan support to survive changes of Administration.
DOE spent more than $7 billion (in 1999 dollars) on all of its energy efficiency RD&D programs during the 22-year period between 1978-2000, the report noted.
Given the difficulty of increasing appropriated funds to this level and the importance of “front-loading” the required investment to jump start innovation, we recommend an alternative approach. The President should engage the private sector and Congress so as to generate about $10 billion per year of additional RDD&D funding through new revenue streams. This increase will provide the US with the potential to leapfrog to development and deployment of the advanced energy technologies that will define a robust 21st century energy system.—“Accelerating the Pace of Change”
For the near term, these funds could come from small charges on energy production, delivery, and/or use, the report concludes, while in the intermediate and long term they may come from carbon dioxide emissions pricing.
At the same time the report recommends that the Administration, led by the Council of Economic Advisors, inventory existing legislative energy subsidies and incentives—including preferred tax treatment and trade restrictions—with the goal of better aligning them with evolving priorities as specified in the Quadrennial Energy Review. The report does not call for eliminating subsidies and incentives, noting that they can be legitimate policy tools, but rather using them to more effectively advance Administration objectives within budgetary constraints.
The report, which builds on the deliberations of a working group consisting of PCAST members and prominent energy experts from the public and private sectors, responds in part to a fall 2009 request by Secretary of Energy Steven Chu to review the US’ current approach to energy-related innovation and recommend ways to accelerate the transformation of the US energy system to a more sustainable model. PCAST concluded that a major factor slowing that transformation is the large number of Federal policies that affect the development, implementation, and use of energy technologies and the lack of coordination among the many departments and agencies with responsibilities under those policies.
A key step to achieving that coordination, the report concludes, is to initiate a government-wide process analogous to the Quadrennial Defense Review undertaken every four years by the Department of Defense. A Quadrennial Energy Review (QER) could establish national goals and coordinate actions across agencies. It could also identify the resources needed for the invention, development, and adoption of new energy technologies options, and policy options such as incentives and regulations to facilitate these activities. The Executive Office of the President would lead the QER with the Department of Energy providing a Secretariat.
It is particularly important to focus on promoting widespread use of new technologies that have proven worthy of scale-up, PCAST concluded, since early-stage innovation is reasonably well supported in the United States but a number of barriers tend to slow adoption and diffusion of new energy technologies in the private sector.
The report recommends implementing a staged process to provide some elements of a QER during each of the next four years, with the first complete and integrated QER targeted for delivery in early 2015. It also recommends that the Department of Energy (DOE) prepare and implement a DOE-level version of a QER focused on that agency’s activities, and should do so on a more rapid timeframe to be completed by 1 June 2011. It further recommends organizational and process changes within the agency that would accelerate progress toward energy innovations, including establishment of a new traineeship program to address critical skill areas for its energy science and technology mission.
Additional recommendations focus on workforce development, social science research on innovation, innovative use of the government’s procurement capacity, and international cooperation.
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