Putting Numbers to DOD’s Clean Energy Innovation Endeavors

In March 2011, ITIF released Lean, Mean and Clean: Energy Innovation and the Department of Defense, a report detailing the ways in which DOD’s accredited and successful innovation ecosystem could be applied to the development of breakthroughs in clean energy technology. To expound further on these conclusions, ITIF – in conjunction with the Energy Innovation Tracker (EIT), a free and publicly accessible data source for federal investments in energy innovation – released a supplementary report: Lean, Mean and Clean II: Assessing DOD Investments in Clean Energy Innovation, which explores in detail the character of DOD’s investments in energy innovation by innovation stage, military branch, and technology. The report concludes that while all DOD investments are mission-oriented and are focused primarily on equipping and protecting the armed forces, commercial spillovers are plausible for advanced technologies with diverse applications.

According to the report, DOD has upped its energy innovation investments at a rate of about ten percent per year on average since FY2009, growing its total energy innovation budget to nearly $1.5 billion for FY2012. Using EIT’s data collection methodology, the report analysis is based on project-level investment documented in the department’s Research, Development, Testing, and Evaluation (RDT&E) budget justification books, and the Procurement budget justification books for each military branch and for the Defense Wide offices DARPA, Office of Secretary of Defense (OSD), and the Defense Logistics Agency (DLA).

DOD is recognized as contributing to some of the most significant technological breakthroughs of the last century, credited in part to its comprehensive and unparalleled innovation ecosystem, which enables technologies to cross both "valleys of death": the “technology valley of death” (when new technologies are unable to compete with conventional, cheap technologies) and the “commercialization valley of death” (when new technologies are unable to make the transition from prototype to full-scale production.) DOD’s innovation ecosystem has successfully advanced communication and transportation technologies to market, and this report details the system’s application to energy technologies. While DOD’s energy RDT&E investments have remained relatively consistent around $860 million since 2009, its procurement of new energy technologies has more than tripled, verifying DOD’s energy projects are beginning to move through the pipeline towards maturity.

The main driver of energy innovation within DOD, however, is a consistent focus on mission operability, maintaining that all technological improvements to the Armed Forces provide both security and capability improvements. Pursuit of mission-oriented innovation is evident in DOD’s technology portfolio. The report suggests that across military departments, DOD energy innovation investments emphasize improvements to electricity and transportation technologies. These investments include advanced power electronics for more efficient and lighter-weight batteries and portable electricity grid systems, as well as advanced alternative fuels for flight and marine operations. Additionally, between 2009 and 2013, DOD’s investments in smart grid technologies more than doubled, and due in part to the Army’s Green Warrior Convoy program, investments in electric motor research, development, and demonstration increased to $20.6 million in 2012.

Energy innovation at DOD is supporting projects across technologies and innovation stages, and as the report states, “…DOD’s investments are important not only because they accelerate innovation, but also because these investments offer a path to rapid cost declines that preclude commercial market entrance.” As clean energy innovation continues to progress and DOD, further opportunities will arise to comprehensively integrate the department’s innovation ecosystems into a broader, coordinated national energy innovation strategy. Ensuring the transparency of DOD investments in energy innovation is the first step in the process of identifying DOD’s potential for instigating commercial spillovers into energy markets.

The Energy Innovation Tracker is a database capturing U.S. federal energy innovation  investment since FY2009. For additional analysis, keep an eye on the Tracker’s blog and follow the Tracker on Twitter: @energyrdtracker.

Photo: DOD Imagery - U.S. Marines with GREENS network system, Feb. 24, 2012.