DOE Winnows Down Pool for High-Risk Energy Tech Funds

doe-logoJust a few months after the Obama administration set aside $400 million for high-risk clean energy research projects, the Department of Energy has narrowed the pool of some 3,500 applicants down to about a couple hundred. This week, the DOE completed its evaluation of the initial concept papers — meant to outline “the kernel” of applicants’ technical ideas, as President Obama put it earlier this year — and have chosen the ones that stand the best chance of winning funds under the so-called ARPA-E (Advanced Research Projects Agency-Energy) program, greenlighting them to submit full applications.

Given that the program has been around since 2007 but didn’t get funding from Congress until the stimulus package passed earlier this year, and in light of the delays seen in other government energy programs, it’s encouraging that feedback is going out on schedule at this point. According to Elise Zoli, a partner at law firm Goodwin Procter, who moderated a panel on Thursday at the AlwaysOn Summit at Stanford about how venture capitalists and startups can work with federal policymakers, only hundreds of applications were expected in the original application process. Of those that were submitted, an estimated 4-10 percent (around 140-350) have been given the nod to proceed with a full proposal.

For the projects that have made it through this first round, teams now have less than a month to complete their proposals. The DOE has not released many details about this week’s selections, but we do have an idea of what the agency is looking for. As we explained earlier this year, when the feds first provided guidelines for ARPA-E, they made clear that the ideal project would have a “multi-disciplinary” technical idea that could reduce dependency on oil imports, improve energy efficiency across all sectors of the economy, reduce greenhouse gas emissions and/or give the U.S. an edge when it comes to the deployment of energy technologies.

In other words, the basic idea is to think really, really big. In its solicitation for the program, the DOE explained, “We are not looking for incremental progress on current technologies.” It wants transformation, and it wants to make investments that are too financially or technically risky for the private sector to buy into them.

For cleantech startups and researchers, the program could help bridge a critical funding gap, providing up to $20 million in aid to, as the WSJ’s Environmental Capital blog put it, “make moonshots reality.” The DOE is specifically looking for ideas and technologies facing what’s called the  “valley of death,” where many capital-intensive startups fall flat because they can’t find financing for a critical phase of development or commercialization.

If you missed the deadline for this round, keep an eye on FedConnect.net, where the DOE will post additional solicitations for ARPA-E proposals “in the near future.” Don’t be discouraged, Zoli said. “It takes time” to make headway in Washington, she said. “You have to keep coming back.”

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