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An Overview of US Advanced Research Projects Agency-Energy Funding Programs

The Advanced Research Projects Agency-Energy (ARPA-E) program was officially launched in 2009 as the result of the 2007 America COMPETES Act, which was signed by President George W. Bush. Congress appropriated and President Barack Obama allocated $400 million in 2009 to begin funding the agency’s first projects. ARPA-E exists within the broader organizational framework of the Department of Energy and was modeled after the very successful Defense Advanced Research Projects Agency (DARPA), which has been credited with developing technological innovations such GPS (global positioning system), the stealth fighter jet and more.

As outlined in the America COMPETES Act, the goals of ARPA-E are to:

  • To enhance the economic and energy security of the United States through the development of energy technologies that result in —
    1. Reductions of imports of energy from foreign sources;
    2. Reductions of energy-related emissions, including greenhouse gases; and
    3. Improvement in the energy efficiency of all economic sectors; and
  • To ensure that the United States maintains a technological lead in developing and deploying advanced energy technologies.

ARPA-E realizes these goals by providing funding for clean and renewable energy projects that support these priorities. Funds are disbursed via a competitive grants process. Since its inception ARPA-E has provided funding for more than 300 potentially transformation energy projects. Grants awarded through ARPA-E range in size from $250,000 to up to $10 million.

ARPA-E does not provide 100% funding for any grant-supported projects. The laws governing projects funded through ARPA-E dictate that every Project Team must contribute at least 20% of the total project cost as cost share. Recipients of ARPA-E funds under Technology Investment Agreements and “other transaction” agreements must contribute at least 50% of the total project cost as cost share.

Funds are awarded through a variety of different programs—each of which has a specific focus. Each individual program is not ongoing but rather, accepts submissions only for a specific timeframe. ARPA-E does not accept unsolicited proposals. Instead, ARPA-E broadly solicits energy-related research proposals using periodic Open Funding Opportunity Announcements (Open FOAs), which are generally issued every two to three years. However, all ARPA-E programs and solicitations exclusively fund energy technology projects that:

  • Identify and promote revolutionary advances in fundamental sciences;
  • Translate scientific discoveries and cutting-edge inventions into technological innovations; and
  • Accelerate transformational technological advances in areas that industry by itself is not likely to undertake because of technical and financial uncertainty.

In all cases, ARPA-E does not fund basic or incremental research.

In its latest round of funding (September 2013), APRA-E provided $66 million in funding to support 33 transformational projects under two programs: 1) Modern Electro/Thermochemical Advancements for Light-metal Systems (METALS); and 2) Reducing Emissions using Methanotrophic Organisms for Transportation Energy (REMOTE).

Through the METALS program ARPA-E is distributing $32 million in grant funds to 18 companies (3 in Primary Production – Aluminum; 3 in Primary Production – Magnesium; 5 in Primary Production – Titanium; 1 in Primary Production – Thermal Storage; and 6 in Secondary Production – Recycling) to develop innovative technologies for cost-effective processing, as well as recycling, of aluminum, magnesium, and titanium, which are ideal for creating lighter vehicles that can save fuel and reduce carbon emissions. 

Through the REMOTE program ARPA-E is distributing $34 million in grant funds to 15 companies (6 in High-Efficiency Biological Methane Activation; 5 in High-Efficiency Biological Synthesis of Liquid Fuels; and 4 in Process Intensification Approaches for Biological Methane Conversion) to develop transformational biological technologies to convert gas to liquids (GTL) for transportation fuels. Current synthetic gas-to-liquids conversion approaches are technologically complex and require large, capital-intensive facilities, which limit widespread adoption. This program aims to lower the cost of GTL conversion while enabling the use of low-cost, low-carbon, domestically sourced natural gas.

 Previous ARPA-E programs include:

  • Agile Delivery of Electrical Power Technology (ADEPT)
    • Potential impact: ADEPT program innovations could contribute to a smarter, more advanced, and more reliable electrical power grid.
  • Advanced Management and Protection of Energy Storage Devices (AMPED)
    • Potential impact: Widespread availability of affordable, safe, and reliable electric vehicles with driving range comparable to today's gasoline-powered vehicles would dramatically reduce U.S. dependence on foreign oil.
  • Batteries for Electrical Energy Storage in Transportation (BEEST)
    • Potential impact: Greater use of electric vehicles (EVs) would decrease U.S. dependence on foreign oil--the transportation sector is the dominant source of this dependence. Each day, the U.S. spends nearly $1 billion on foreign oil to power its cars, trucks and planes.
  • Building Energy Efficiency Through Innovative Thermodevices (BEETIT)
    • Potential impact: Increased energy efficiency would decrease U.S. energy demand and reduce reliance on fossil fuels--strengthening America's energy security.
  • Microorganisms for Liquid Transportation Fuel
    • Potential impact: Cost-competitive Electrofuels would help reduce U.S. dependence on imported oil and increase the nation's energy security.
  • Green Electricity Network Integration (GENI)
    • Potential impact: A more efficient and reliable grid would be more resilient to potential disruptions from failure or attack.
  • Grid-Scale Rampable Intermittent Dispatchable Storage (GRIDS)
    • Potential impact: A more efficient and reliable grid would be more resilient to potential disruptions.
  • High Energy Advanced Thermal Storage (HEATS)
    • Potential impact: Cost-effective thermal energy storage would enable increased use of domestic solar and nuclear energy resource, and increased use of thermal fuels and EVs would reduce U.S. reliance on fossil fuels — strengthening the nation's energy security.
  • Innovative Materials and Processes for Advanced Carbon Capture Technologies (IMPACCT)
    • Potential impact: Coal will continue to provide most of the electricity in the U.S. for the foreseeable future. Enabling the continued use of abundant, domestic resources will promote a safe, reliable, and consistent electric grid as the renewable energy industry develops.
  • Methane Opportunities for Vehicular Energy (MOVE)
    • Potential impact: Greater use of domestic natural gas resources in the transportation sector would decrease America's dependence on foreign sources of fuel.
  • Plants Engineered to Replace Oil (PETRO)
    • Potential impact: The transportation sector accounts for nearly all of our petroleum imports. Providing an advanced biofuel alternative to petroleum will allow the U.S. to reduce or eliminate these imports, improving our national security.
  • Rare Earth Alternatives in Critical Technologies  (REACT)
    • Potential impact: The U.S. produces a small fraction globally of industrial rare earths. Developing alternatives to the use of rare earths has potential to reduce our dependence on these materials and will have a positive impact on our national economic and energy security.
  • Small Business Innovation Research/Small Business Technology Transfer (SBIR/STTR)
    • Potential impact: Widespread availability of affordable, safe, and reliable EVs with driving range comparable to today's gasoline-powered vehicles would dramatically reduce U.S. dependence on foreign oil.
  • Solar Agile Delivery of Electrical Power Technology (Solar ADEPT)
    • Potential impact: Lowering the cost of photovoltaic (PV) systems would help increase the use of solar energy, which in turn would decrease our dependence on fossil fuels and improve U.S. energy security.

In addition to the programs above, ARPA-E has issued two open FOAs (one in 2009 and another in 2012).

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The long-term goal for companies that receive funding through ARPA-E programs is for these firms to grow, fully commercialize their transformational energy technologies, launch them in the marketplace and to become profitable, sustainable enterprises. ARPA-E says that many grant fund recipients have received follow-on funding from private investors, governmental agencies and other organizations. 

In terms of measuring the success of the projects it funds, ARPA-E uses performance measures such as: breakthrough achievements (e.g., patents, publications); moving technology to market (e.g., partnerships with other government agencies, licensing/acquisition by an established firm, licensing/acquisition resulting in a spinoff, private-sector funding or company growth); and operational milestones (e.g., award and contracting benchmarks).

ARPA-E says that at least 11 grant-funded projects have secured more than $200 million in private sector funding while five grant-funded projects have generated spin-off companies or have gone public through Initial Public Offerings (IPOs). ARPA-E grant recipients have also applied for at least 34 patents and submitted at least 48 technical papers. 

ARPA-E’s budget request for fiscal year 2014 is $379 million, which is $29 million higher than its $350 million request for fiscal year 2013. Unfortunately, given the persistent state of uncertainty surrounding the debt ceiling, sequestration and the overall federal budget, no one can accurately predict the dollar amount ARPA-E will have available to support projects in the coming years. 

Given the difficult private finance environment, funding programs such as ARPA-E fill a critical gap that enables firms to develop, commercialize and bring to market transformational energy technologies. Without government funds many of these projects would languish and perhaps never be developed. Hopefully, our leaders in Washington will continue to fund programs such as ARPA-E and continue to advance high-potential, high-impact energy technologies that are too early for private sector investment.

Lead image: Laboratory via Shutterstock

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