Thoughts from the recent US Department of Energy/ARPA-E Enhancing Capital Flow Into Early Stage Clean Energy Workshop
I recently participated at and gave a presentation at the Advanced Research Projects Agency-Energy (better known as ARPA-E) Enhancing Capital Flow into Early Stage Clean Energy workshop in Denver.
For those of you who aren’t familiar with ARPA-E, it is an agency of the US Department of Energy tasked with identifying, assisting and funding research and development of advanced energy technologies, modeling itself after the Defense Advanced Research Projects Agency (DARPA). Cadenza Innovation is a ARPA-E award recipient from 2013.
ARPA-E was launched in 2009 to encourage the Apollo-type efforts of our generation and funds cutting edge energy technologies in high risk areas of their development—often the infamous “Valley of Death” between laboratory and field prototype. At the time of funding, ARPA-E projects are often unlikely to get private funding but have the potential of major, transformational, technological advances and commercialization if successful. As Ellen Williams, ARPA-E’s Director, is fond of saying, “we always ask ourselves: ‘if it works, will it matter?’”
For example, solar and wind are coming down in price but it is storage that makes the time-shifted use and sale back (net metering) of renewable energy possible. Cadenza’s technology of safe, inexpensive and high energy density battery packs makes ARPA-E’s effort at driving for the goal of $125/kWh for energy storage very real.
At this several-day workshop, a wide ranging and talented group of early stage bankers, inventors, thought-leaders, ARPA-E and DOE staff (including leaders from the Energy Efficiency office at DOE) and many early stage ARPA-E recipients met and shared their insights. An important element of the discussion was the identification of financial metrics that are achievable within the clean energy sector and suggestions for novel financial instruments that achieve desired metrics.
It was an exciting two days of learning from each other by examining case studies of successes and failures and best practices related to the financing of cutting-edge, early stage, clean energy start-ups. These amazing companies add so much value to our clean energy ecosystem but often fail for lack of funding. I was my own “angel investor” and thus had personal “skin in the game” along with ARPA-E’s award to Cadenza.
The many reasons that ARPA-E is important were on display at this workshop—in particular, ARPA-E’s role in validating ideas for commercialization and that it brings helpful parties to the table such as the National Renewable Energy Laboratory (NREL) and other testing labs.
Another key area of focus was the $23 trillion dollars projected by the World Economic Forum and the IFC (part of the World Bank) that will be spent on promised efforts to fight climate change through 2030 consistent with the 2015 Paris accords and how the technologies represented in the conference and funded by ARPE-E can and will play a critical role in that spending.
I came away from the workshop with the view that there has never been a better time to be a part of a culture of real innovation, creating potentially great worldwide outcomes in sustainable jobs and climate change, and getting paid as an inventor if you are successful.