Report of Yergin Task Force on DOE’s Energy R&D Programs

”...energy research and development (R&D) remains vitally important for the future of our Nation and...private-sector investments...are no substitute for a continued, significant role by the Federal Government.” --Task Force on Strategic Energy Research and Development

With the Department of Energy under the threat of elimination by some House Republicans, both supporters and foes have awaited the results of reviews examining various DOE functions. The most recent report, on the Department’s energy R&D programs, was transmitted to the Secretary of Energy Advisory Board on June 13. Entitled “Energy R&D: Shaping our Nation’s Future in a Competitive World,” the three-volume document is informally known as the Yergin Report for Task Force chairman Daniel Yergin. Like the Galvin Report on the national laboratories that was released in February, the Yergin report primarily reaffirms DOE’s role in the area it examined, while suggesting that some money could be saved by management improvements.

The report, which runs nearly 500 pages, begins by looking at the global context for energy R&D investment: the predominance of economic competition in the post-Cold War era, the declining investment in long-term R&D by private industry, and the importance of energy to national security. Stating that “innovation and technological creativity cannot be summoned into service on short notice,” the Task Force calls on the federal government to ensure continuity in energy research. It suggests that the government should invest in research that is in the public interest but that the market will not perform because of its long-term, high-risk, precompetitive nature.

While concurring with DOE’s critics that the big energy demonstration projects of the 1970s were too ambitious, the report claims that DOE’s energy R&D programs have improved steadily over the past two decades. DOE now uses more peer-review, has a more diverse portfolio, includes academia and industry in the early planning stages, leverages its funding with partnerships, and uses outside reviews of performance. Annex 3 to the report lists a number of market successes nurtured by DOE investment.

While recognizing the need to cut budgets, the report points out that the federal investment in energy R&D has declined by 75 percent over the past 17 years. Although finding that “further reductions are possible,” the Task Force states that “deep cuts in...R&D support would damage our Nation’s R&D prospects.” The report recommends that DOE set a target of cutting costs by 15 percent over the next year by reforming management and administration of the energy research programs.

The Task Force provides the following additional recommendations for DOE: that it adopt, as far as possible, business practices for procurement, contracting, financial control, and benchmarking; develop an integrated strategic plan for a balanced portfolio of energy R&D; establish a single position with responsibility for the portfolio; reactivate a standing energy R&D advisory board; explore a two-year budget cycle; and consider alternative methods of financing R&D, such as user fees and royalty payments.

A copy of the three-volume report can be obtained by contacting DOE Public Affairs at 202-586-5575.