Looking Back at the Tenure of Energy Secretary Steven Chu

Steven Chu published an open letter today to Department of Energy (DOE) employees announcing that he will not continue to serve as Secretary under the second Obama administration. The letter is a great overview of the Energy Department’s challenges and accomplishments over the past four years and is very much worth reading in its entirety. Here are some important highlights.

As ITIF has pointed out, the Advanced Research Projects Agency-Energy (ARPA-E) is “a leading force for energy innovation in the country, if not the leading force.” It almost certainly enjoys the most bipartisan support of any Energy Department agency. Yet as Secretary Chu observes, at the start of his term, it was simply another unfunded mandate:

Four years ago, ARPA-E was a vision described in the report, Rising Above the Gathering Storm. I was a member of that committee, but never dreamed that I would be asked to take the concept to reality… What have been the early results? ARPA-E was described by Fred Smith of Fed Ex in his ARPA-E Summit Keynote address that in his opinion, ARPA-E was [the] best government funding program he has ever seen. In the first few years, 11 of the companies funded with $40 million dollars have attracted more than $200 million in combined private investment. While it is too early to tell if we have home runs like ARPA-net, there are a number of investments that have certainly rounded second base.

Furthermore, the success of ARPA-E has inspired initiatives across the Department, with the Secretary highlighting ITIF Senior Analyst Matthew Stepp’s report on ongoing reforms at the Office of Energy Efficiency and Renewable Energy:

The spirit of ARPA-E is now being disseminated in other parts of the Department. The first transplant was a completely revitalized solar photovoltaic program that was dubbed SunShot. A small cadre of enthusiastic individuals led a transformation. Unsolicited feedback from industry and academia alike noted the dramatic increase in the quality of the program with essentially no increase in budget. One of the founding members of ARPA-E is now the Assistant Secretary of Energy Efficiency and Renewable Energy (EERE). Remarkably, a recent Forbes article described the changes now in progress with the lead, “quiet clean energy innovation revolution at the Department of Energy,” and noted “a leap in the right direction and absolutely critical to creating a more flexible, innovation-focused DOE mission.”

Secretary Chu continues by noting the SunShot program’s progress in striving to reduce the full cost of utility scale solar energy to $1 a watt. “When we first discussed this goal, industry did not take it seriously,” the Secretary states. “Today, they tell me that our input challenged them to rethink their road maps and now agree that it is an achievable goal.” The head of that program, Minh Le, was actually a panelist at the Energy Innovation 2013 conference co-hosted by ITIF and the Breakthrough Institute earlier this week, where he spoke at length on the importance of innovation in achieving continued cost reductions. The Secretary also talks at length about the Department’s success in administering Recovery Act funds, which ITIF has argued constitutes “clear evidence of the overwhelming value of public investment in clean energy.” He also touches on the establishment of the Energy Innovation Hubs and DOE action in the aftermath of the Fukushima Daiichi nuclear meltdown and Hurricane Sandy, along with a host of other issues, and concludes by “making a few observations about the importance of the Department of Energy missions to our economic prosperity, dependency on foreign oil and climate change.”

Of course, for all of DOE’s achievements under the leadership of Secretary Chu, more work remains to be done. ITIF has argued that innovation should be even more central to the next Energy Secretary’s agenda, who should build on the ongoing restructuring of EERE and implement Department-wide institutional reforms. It is paramount that the nation gets its energy policies right as President Obama seeks to tackle climate change in his second term. DOE will play an integral role in that endeavor, whether that role is fully appreciated or not. “We have planted many seeds together,” Secretary Chu writes in closing. “Just as today’s boom in shale gas production was made possible by Department of Energy research from 1978 to 1991, some of the most significant work may not be known for decades. What matters is that our country will reap the benefits of what we have started.”