What do jet engines, computers, transistors, the internet, and the Global Positioning System (GPS) have in common? They all owe their existence to early stage investment by the U.S. Government.
When it comes to emerging technologies and industries, very often the barriers to market entry can be prohibitively high for purely private sector investment.
Government funding can mitigate the high costs and risks of initial research and development (R&D) and through its huge power of procurement, government funding allows private industry to take bigger gambles on R&D. With early stage investment, government funding aims to bring embryonic technologies to commercially viable products and services. The experimentation that accompanies these new technologies can be very costly and entail considerable risks. If private enterprise can imagine commercial promise in a radically new technical idea then it will gamble. But there are limits to a firm’s willingness to gamble – and this is where government funding can step in.
Yes, government has made mistakes – Solyndra is a recent example that critics cite as a failure of government meddling – but it has also played a strong role in laying the foundation for America’s technological and industrial leadership.
At the 2012 ARPA-E Energy Innovation Summit, held this week at the National Harbor in Maryland, Dept. of Energy Secretary Steven Chu reiterated the importance of fostering technology breakthroughs that will make renewable energy affordable and thus improve the long-term economic health of the US. Chu mentioned the many innovations in science, often funded by government, that have improved how we live and brought greater prosperity to the country.
One of the foci at the summit is the development of next generation batteries and energy storage, which would have wide-ranging beneficiaries ranging from stabilizing the variability of electricity produced from utility scale wind power and increasing the drive-range of electric cars – two issues that could help revolutionize the domestic energy and transport industries.
Chu added that the ARPA-E agency was created to fund this very type of research, which is high risk but has a potential for major breakthroughs within three to five years. Chu was quoted saying “ARPA-E’s aim is to invent a new learning curve and then let it compete with other existing technologies.”
In fortuitous news, ARPA-E grant recipient and California based Envia Systems announced earlier this week a breakthrough with its new lithium ion battery that will extend the range of electric vehicles while lowering the associated battery costs.
As the saying goes, “It’s better to shoot for the stars and miss than aim at the gutter and hit it.”