An Innovation Agenda for Deep Decarbonization: Bridging Gaps in the Federal Energy RD&D Portfolio

The world is not on track to achieve the deep reductions in carbon emissions necessary to avoid the worst impacts of climate change. While the United States saw a modest decline in emissions in the 10-year period from 2007 to 2017—primarily due to the substitution of natural gas and renewables for coal in power generation—this trend may be coming to an end. The situation is even less encouraging at the global level, where carbon pollution has yet to peak, and emissions increased 2 percent last year. A substantial increase in and significant reorientation of federal energy research, development, and demonstration (RD&D) is needed to break out of this looming cul-de-sac.

The energy innovation agenda of the last 10 years has focused, with considerable success, on reducing the cost and expanding the use of wind and solar resources for electricity generation. It is time now to expand the agenda beyond this “low-hanging fruit.” Reducing carbon pollution to zero will require a broader set of technologies that cover all sectors of the economy in order to provide energy that is as cheap and reliable as that from fossil fuels. The effort should extend to hard-to-decarbonize sectors such as air travel and shipping, and cement and steel production, for which there are currently no good zero-carbon options.

This report diagnoses the limits of the current clean energy innovation agenda and identifies sectors and technologies that are underrepresented in the RD&D portfolio. It develops a set of six “technology missions” to bridge these gaps, and offers the following recommendations to U.S. policymakers—although all of the missions and many of the recommendations are ones that should be embraced by all developed nations.

Mission 1: Advanced Nuclear Energy

• Re-prioritize the Department of Energy’s (DOE) Office of Nuclear Energy (NE) to focus on advanced nuclear reactor technologies, and commit to the demonstration of at least one advanced reactor design.
• Expand linkages between basic science research in the DOE Office of Basic Energy Sciences and National Science Foundation (NSF), and the applied RD&D at NE and Department of Defense (DOD).
• Commit to constructing the Versatile Test Reactor to enable testing of materials and fuel designs in a fast neutron environment.
• Develop a domestic supply of high-assay, low-enriched uranium (HA-LEU) that is compatible with fueling requirements for advanced reactor concepts.
• Expand RD&D into other applications for nuclear energy, such as providing process heat or producing carbon-neutral fuels.

Mission 2: Long-Duration Grid Storage

• Establish a second innovation hub modeled on Joint Center for Energy Storage Research to pursue science and technology for long-duration grid storage.
• Expand investments by DOE’s applied energy offices and ARPA-E in grid storage R&D and focus them on long-duration problems.
• Expand DOE funding for long-duration grid storage technology demonstration projects in partnership with other stakeholders.
• Establish an interagency working group on long-duration grid storage within the National Science and Technology Council (NSTC) to facilitate interagency information exchange and coordination.
• Propose and lead a new innovation challenge on long-duration grid storage within the international Mission Innovation framework.

Mission 3: Carbon-Neutral Fuels

• Establish an innovation hub focused on hydrogen and ammonia production methods that do not use fossil fuels as feedstock.
• Expand R&D into applications of hydrogen and other carbon-neutral fuels in hard-to-decarbonize transportation sectors such as aviation and long-haul shipping.
• Establish an R&D program focused on applications of carbon-neutral fuels in the industrial sector (e.g., the provision of high-temperature process heat).
• Implement the recommendations from the recent National Academies report on carbon utilization that focus on chemical and biological pathways for the conversion of carbon dioxide into fuels and chemicals.

Mission 4: Carbon Capture, Utilization, and Storage (CCUS)

• Establish a carbon capture demonstration program that funds first-of-a-kind demonstration projects for carbon capture at natural gas, steel, concrete, and other large sources of carbon dioxide.
• Expand the DOE Title XVII loan programs to cover carbon capture at industrial facilities.
• Establish a single carbon capture R&D program—outside the coal program office—that includes carbon sources across all sectors, including cement and steel.
• Expand a carbon utilization R&D program that addresses the research needs identified in the National Academies report on carbon utilization.
• Continue to support R&D in geologic storage in saline aquifers and depleted oil and gas fields, and expand storage R&D to include basalt and other carbon-absorbing mineral formations.

Mission 5: Carbon Dioxide Removal Technology

• Establish an applied RD&D program that implements the recommendations of the National Academies report on negative emissions technologies and prioritizes pilot-scale demonstrations of direct air capture.
• Research methods to increase carbon removal capacity and mitigate environmental impacts of land-based approaches, including approaches that enhance soil carbon sequestration.
• Establish an innovation hub that addresses basic science needs for carbon removal pathways.
• Establish an interagency working group within NSTC to coordinate federal research and facilitate information exchange across agencies.

Mission 6: Basic Energy Research

• Double the number of Energy Frontier Research Centers (EFRCs) and ensure alignment with the hard-to-decarbonize technology missions.
• Provide full funding for the next generation of DOE user facilities, as well as planned upgrades at existing facilities.
• Evaluate whether the capacity of existing user facilities is sufficient to accommodate all research applications with scientific merit, and develop a plan to build additional user facilities where warranted.
• Expand NSF funding for energy-related research that advances the science underpinning clean energy technology breakthroughs.

This report explains why the world needs zero-carbon energy. It then examines the current global and domestic emissions trajectory, finding that without further innovation, domestic emissions are projected to level off, while global emissions will continue to increase through 2050. The report then identifies gaps in the current U.S. energy RD&D portfolio and outlines an innovation agenda to address “difficult-to-eliminate” carbon emissions. The final sections develop the technology missions to bridge these gaps.