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Energy Research at DOE was it Worth it?: Energy Efficiency and Fossil Energy Research 1978 to 2000
shrift to conservation. The Carter administration made conservation a centerpiece of its energy policy, and much was made of the “market failures” that prevented the private sector from adopting cost-effective (and readily available) energy conservation technologies. The Reagan administration took a different view, and cuts in the conservation budgets were among the most severe of the cuts that it proposed.
In the late 1980s, the nation’s understanding of the energy problem and of the goals of energy policy matured. By 1985, the combined effect of more efficient energy use and important new finds of oil and gas had loosened the hold of the Organization of Petroleum Exporting Countries (OPEC) on oil prices and greatly leavened the pessimism of the resource depletion school of energy policy. Concern for energy dependence (measured by the level of oil imports) gave way to the notion of vulnerability (calculated as the fraction of oil used in the economy whether imported or not) as the chief metric of security against possible disruptions in international oil markets. Environmental concerns gained even greater prominence as a driver of energy policy, particularly the need to moderate emissions from the nation’s most widely used domestic energy resource—coal. The emergence in the 1990s of global climate change as a serious environmental issue deepened concerns over the burning of coal, and indeed of all fossil fuels. Early views of energy conservation changed to become a strategy of deploying energy efficiency technologies as an economically attractive solution to energy and environment problems. During this time, DOE first began to appreciate and address the health impacts of indoor air quality associated with the inappropriate use of more efficient technology with the potential to cause adverse health effects when buildings become essentially sealed environments.
Arguably, the late 1980s and early 1990s saw energy policy and its associated research objectives reach a more stable level. Even so, adapting to these shifts created another round of profound change in the direction and management of DOE’s R&D program. Early in the period, the Clean Coal Technology program invested heavily in technologies for burning coal in a more environmentally friendly way. After 1992, technology priorities moved in the direction of renewable energy sources and energy efficiency, newly interesting because of their low or zero net contribution to greenhouse gas emissions, thus offsetting fossil energy-based emissions and slowing the buildup of atmospheric greenhouse gases and resulting climate change. Toward the end of the period, energy R&D planning began to take a portfolio approach, recognizing both that energy policy must serve multiple goals and that research produces failures as well as successes. And the role of federal funding, having swung between support of expensive demonstration projects and limited funding of basic research, settled into a preference for cost sharing in the form of public-private partnerships.
This brief recounting of the shifting forces that shaped energy R&D over the last 25 years leaves out many important details, of course. But even the highlights convey a sense of the twists and turns of both the program goals and the management philosophy that DOE’s research managers have had to follow since 1978. Without an appreciation of these shifts, evaluating the successes and failures of DOE’s research program would be a very frustrating and puzzling enterprise.
ORIGIN AND SCOPE OF THIS STUDY
In legislation appropriating funds for DOE’s fiscal year (FY) 2000 energy R&D budget, the U.S. House Appropriations Subcommittee on the Interior directed an evaluation of the benefits that have accrued to the nation from the research and development programs that have been conducted since 1978 in DOE’s Office of Energy Efficiency and Renewable Energy and its Office of Fossil Energy. The congressional charge for this evaluation limits its scope to the energy efficiency and fossil fuel programs because they are the ones under the jurisdiction of the subcommittee. DOE conducts other energy research programs, including ones in renewable and nuclear energy.1 The two program areas—energy efficiency and fossil energy—that lie within the scope of this study have expended about $22.3 billion in federal funds since 1978, or about 26 percent of the total DOE energy R&D expenditure of approximately $85 billion (2000 dollars) (NSF, 2000).
There have been large differences in project scale, size, complexity, and time horizon between the energy efficiency and the fossil energy programs; these differences make any direct comparisons of results of the two programs difficult. Both programs have long histories and have undergone significant changes over the past two decades. The Office of Energy Efficiency and Renewable Energy came into being in its current form around 1982, having evolved from the Office of Conservation and Renewable Energy, the name by which it was known after DOE was founded by the Carter administration. The change in name reflected both the changeover to the Reagan administration and a shift in philosophy as the energy crisis eased. The Office of Energy Efficiency and Renewable Energy comprises five main program offices, three of which this study focuses on: the Office of Building Technology, State, and Community Programs (BTS); the Office of Industrial Technologies (OIT); and the Office of Transportation Technologies (OTT).
Research in the Office of Fossil Energy has historically focused on two main programs: the Office of Coal and Power Systems (CPS) and the Office of Natural Gas and Petroleum Technology (NGPT). The coal and power systems program can be viewed as having gone through three phases since DOE was formed. The first phase, from the late 1970s to the
The committee is sensitive to the fact that the study covers only part of the energy research conducted by DOE, but it elected not to extend the study to include the entire technology portfolio.